Blockchain technology is widely associated with crypto currencies such as Bitcoin, allowing transactions to be recorded in a way that is not easy to tamper with. But blockchain has wider implications for protecting transactions and for securing IT devices, so how does it work and what implications does it have for the future?
What is blockchain
Put simply, blockchain is a sort of digital ledger. It’s a series of records of transactions each of which is time-stamped. So far so conventional, but what makes blockchain different is that these records are not managed centrally but by a whole series of computers.
This means that all of the data contained in the chain is open for every system to see although sensitive information can still be encrypted so it can’t actually be read. Any attempt to tamper with the information is therefore immediately apparent. When a new transaction is initiated a ‘block’ is created. This is verified by thousands of other systems and is added to a ‘chain’ stored across the internet. This creates not only a unique record but one that has been separately verified many times. Each block is linked to the ones before and after it. In order to falsify a record, therefore, you would have to modify the entire chain which, because of its size and its distributed nature, is practically impossible.
You can see why this is good for financial transactions because each one is independently verified and the chain builds into a record of all the transactions made. It can also be applied to any kind of commercial transaction. Blockchain can be used to create conditional contracts, automatically commencing a service or shipping goods when a payment is received.
Of course, maintaining and verifying the chain needs processing power. Systems running programs called ‘miners’ work to verify the transactions and, in the case of crypto currency, are rewarded for their efforts with small payments.
Blockchain & IT Security
So, how does all of this help to secure It systems? One way is that it can be used to secure stored data. Instead of having to use cryptographic keys, data can be stored in a blockchain across multiple devices. If someone tries to destroy or tamper with the data, the system analyses all of the stored chains and anything that doesn’t match gets excluded. You would need access to every device to introduce a rogue record and provided that one remains active with the original data, the chain can be restored.
There’s also potential for blockchain to be used in preventing DDoS attacks. These attacks are used to disrupt websites by overwhelming them with traffic via the domain name system (DNS) which is a centralised database of sites. By decentralising DNS using blockchain and distributing the information across multiple systems, it becomes more difficult to attack. Domain editing rights would only be available to the domain owner, making redirecting traffic impossible – again without access to all the nodes in the chain.
Blockchain’s lack of centralised control also means it’s likely to have a role to play in protecting Internet of Things devices. Currently, IoT devices produce high volumes of information but it is largely unverified. By linking this information to blockchain, incoming information would need to be verified by at least two nodes before being added to the chain.
Because much IoT data isn’t as sensitive as that in things like financial records, IoT validation could use simpler algorithms, allowing transactions to be verified more rapidly than those on Bitcoin. This would reduce latency and allow high volumes of records to be added quickly.
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