The meteoric rise of Blockchain technology has sparked a myriad of exciting, new opportunities in business. But with this comes a new series of challenges—the rise of cybersecurity being a major case in point.
One of blockchain’s most valued features is its inherently secure structure, therefore the threat of cyber security would seem counter-intuitive at first glance. The main reason being that the distributed nature of the system makes it more difficult to tamper with unlike traditional centralized databases, which tend to have more clear and public attack targets. However, the extent to which the blockchain maintains safety depends on a number of factors. And largely because the blockchain is still in its infancy, cybercriminals have found ways to exploit it.
In fact, cyberattacks have become more common due to greater sophisticated malware technology and the rise of cyber organizations. According to one recent study, cybercrime is amassing at least $1.5 trillion dollars per year through online markets. These individuals and groups primarily seek to steal data, whether intellectual property, personal identification information, health records, or financial data. How? Through various “Cryptojacking” means, including account takeovers, mining fraud, and initial coin offering scams, such as fake websites.
Luckily, these emerging threats have only pushed blockchains to implement robust security protocols, specifically through the full encryption of blockchain data and authentication, authorization, and audit (AAA) strategies. This means that data cannot be accessed by third parties while in transit, not least when transit takes places in untrusted networks. And companies have been quick to successfully implement such measures in full-force.
London-based Fintech Lendo is one leading example. Lendo offers fiat loans to the crypto holding community. Over a period of 48 hours last week, the company endured sustained attempts on their system. COO Guido Granello told us: “For us customer security is everything. Hackers have tried to target us several times since launch. Because of this, we have put in place robust enterprise level cyber security systems to ensure any threat is squashed. Last week we had four separate attempts on our platform, we were able to shut these attempts down immediately.”
Such victories help answer a pressing question for the blockchain industry, namely: will the new technology prevent or permit more cybercrime? As the blockchain redefines security altogether, it has in turn allowed tracking hackers much easier. Thanks to a series of emerging new tools from companies like Chainalysis, blockchain hack prevention is being sought to support investigations in partnership with the U.S. Internal Revenue Service, the Federal Bureau of Investigation, the Securities and Exchange Commission, the Drug Enforcement Administration, Immigration and Customs Enforcement, and Europol. If cybercriminals seek to challenge the widening security measures of blockchain, it’s clear they will be up against a much tougher security landscape than ever before.