One of the main virtues of blockchain technology is security. The data that contains the block chains are stored using sophisticated mathematics and really innovative software rules that are extremely difficult to manipulate by attackers. However, the place where these rules come into contact with human beings is where the most fragile area of these rules is located. Speaking about the blockchain security Cameron Chell ICOx has recently announced a new blockchain infrastructure that allows organizations to operate regulatory compliant cryptocurrencies for payments which will transform the transaction process and the way people do business. Cameron Chell is a serial entrepreneur with over 25 years experience in the technology, energy and finance sectors. The technology provides the same buyer protections users are accustomed to with credit cards, with an additional layer of trust and security through blockchain verification and two-factor authentication.
The reasons why Blockchain is so safe:
To understand why this happens, it is best to understand first what it is that makes blockchain such a safe technology. For this, we can start from the Bitcoin example.
Within the chain of Bitcoin blocks, the data that is shared is a kind of accounting book because it deals with the history of each transaction of the cryptocurrency that is made from the beginning of its existence.
Every time someone makes a transaction (which means that it is “written down” in the book), the nodes verify that it is a valid transaction. This basically means that who spent a Bitcoin did it because they had a Bitcoin to do it.
A subset of the nodes competes to package valid transactions within blocks and add them to a chain of previous transactions. The owners of these nodes are called miners and those who successfully add new blocks to the chain earn Bitcoins as a reward.
What makes this system tamper-proof are, in principle, two things: the unique cryptographic footprint that is assigned to each block, called a hash, and a “consensus protocol” , which is the process by which the nodes of the network agree on a shared history.
Each hash requires a lot of calculation time and, therefore, a lot of energy to generate for the first time. Therefore, it serves as proof that the miner who added the block to the chain did the necessary work to receive a reward in Bitcoins in return. It also serves as a kind of seal or certificate, since to alter a block you have to generate a new hash.
Checking whether the hash matches the assigned block is easier. Once the participating nodes verify the hash, they update their respective copies of the chain with the new block (continuing with the simile of before: they add a new entry to their copy of the accounting book). This is the consensus protocol.
Security element in case of Bitcoin:
The other security element is that the hashes also serve as links in the block chain. Each block includes the unique hash of the previous block, so if you want to modify what it contains, it is not only necessary to calculate a new hash for it, but also for the block that follows it. And this has to be done faster than other nodes can add new blocks to the chain.
In order to “cheat the system”, it is necessary to have computers that are more powerful than all the combined nodes. And even this would not be a guarantee of success. Therefore, the moment a block is altered, it will come into conflict with the existing ones and the nodes will automatically reject the alterations made.