Blockchain was originally designed as a technology to support cryptocurrency, and its use is expanding beyond its financial roots to benefit organisations across different industries. From enhancing customer experience in day-to-day trade, finance and cross-border payments, to smart contracts and IoT security, blockchain is transforming the way companies do business.
Despite its cryptographic history, organisations should not see blockchain as a silver bullet when it comes to security. Like all technology, it has its own weak points and hackers are increasingly manipulating these weaknesses for their own financial gain.
Unfortunately, the most common weakness in blockchain security lies in the very thing that makes it secure, namely cryptography. Blockchain is open to abuse if the keys aren’t secured. Since the inception of key-based encryption, cyber criminals have been using a host of methods, such as brute force attacks and phishing and social engineering, to get hold of information about private keys from their owners. One of the most notable examples of this resulted in the theft of over $500 million from a Japanese cryptocurrency exchange. It has become so common place that there are even scores of videos on sites like YouTube that provide step-by-step instructions on how to hack private keys.
Given the high-value financial and safety-critical nature of some proposed blockchain use cases, it is imperative that nothing alters data prior to its placement on the blockchain. While multi-signature features will enhance levels of security by introducing additional distributed keys for recovery and authentication of transaction, they still rely on […]
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