Blockchains are more than just Bitcoin – they’re a whole new way of looking at cyber security, writes Vijay Michalik, research analyst for digital transformation at Frost & Sullivan
Blockchains are a nebulous concept. You’ll have heard of Bitcoin already, and may understand that a blockchain, in the technical sense, is the foundation. Blockchains don’t just encompass this breakthrough technology, but a spectrum of business models, organisational structures and radical ideas.
Bitcoin is the first truly successful blockchain application, a digital currency, and it occupies an important space within this spectrum. Its technological capabilities are matched with a carefully balanced incentive structure. It also fosters a community around its open-source development, and third-party businesses creating applications and integrations.
Blockchains are built on a history of security research
Far from being an unprecedented breakthrough, with unintended consequences, the blockchain technology stack is a culmination of decades of cryptography and security research.
The 1970s cryptography breakthrough of the Merkle tree and the distributed hash tables of the 1990s combine to create autonomy, fault tolerance and scalability for distributed systems. They’re the tools that built famous decentralised applications like BitTorrent, Napster and Freenet.
Bitcoin’s most impressive contribution is recognising the synergies between this field of distributed communications and file sharing systems, and digital currencies, which had seen many false starts prior to Bitcoin’s success since 2009.
The key was Hashcash, a system proposed in 1997 to limit and suppress email spam and denial-of-service attacks. Hashcash is an algorithm that requires the sacrifice of processing power as a security mechanism. This proof-of-work creates the incentive structure and network verification that now powers cryptocurrencies.
The final step is the addition of smart contracts to the blockchain stack, a name coined by Nick Szabo as early as 1993. Smart contracts are algorithmic; a type of self-executing code which enables more complex asset transfer and the automated exchange of rights. These are the building blocks of a complete programming language, and the more advanced blockchain applications such as those envisioned by Ethereum.
What we get is a set of security tools that are very good at coordination between mutually unknown actors and secure data or value transfer. We think of blockchains as having four key characteristics to this end: they’re cryptography-based, distributed, peer to peer, and, in many cases, open source.
Innovative blockchain applications in security
As with many open source movements, we’re seeing the different stages of the blockchain ecosystem build out in waves: first the core protocols (Bitcoin, Ethereum and other platforms); now middleware, from Consensys; and then applications.
There’s been some degree of consolidation on blockchain development around Bitcoin and Ethereum over the past year, although Ethereum isn’t the second biggest token by market capitalisation.
Bitcoin’s first mover-advantage and financial specialisation has granted it momentum and early market interest, while Ethereum’s Turing-complete programming capabilities enable many other truly disruptive opportunities.
Guardtime’s security solution runs on a private blockchain, and features a cross-vertical solution replacing RSA digital signatures: its KSI (Keyless Signature Infrastructure), which uses only hash-function cryptography for signing. This prepares digital identity systems for the security necessities of the future – where quantum computers make factorisation problems like those that RSA relies on trivial.
Inter Planetary File System (IPFS) is a new core internet protocol that is designed to supplant the Hypertext Transfer Protocol (HTTP). IPFS can address some of the most difficult security challenges that the HTTP-based internet faces: centralised hosting and distribution, and weak application of content-signing protection.
Using context-driven storage, self-certification and an incentivised blockchain mechanism, IPFS becomes a secure, permanent web, resilient against server failure.
MIT’s Enigma, based on the Bitcoin blockchain, enables any code to be run on encrypted data. In its model, data can be stored, shared and analysed without being fully revealed to a single third party, enabling trustless sharing of data and distributed computation without resorting to full transparency. This grants blockchains, even in a permissionless setup, access to the full spectrum of data visibility from fully private to public.
The Latest on: Blockchains
via Google News
The Latest on: Blockchains
- Report: Bitcoin Is Becoming More Centralizedon February 2, 2020 at 10:29 am
Is Bitcoin Becoming the Opposite of What It Was? One of the big problems that we continually see with various cryptocurrency blockchains is that they will often sacrifice security or decentralization ...
- Commentary: What is the state of blockchain in the supply chain?on January 31, 2020 at 7:23 am
So it was with a bit of nervousness that The New York Supply Chain Meetup organized its first meetup of 2020 on Thursday, January 23, #TNYSCM18 – Blockchains in Supply Chain. We wanted to hear ...
- Don’t be fooled: Blockchains are not miracle security solutionson January 31, 2020 at 3:06 am
The idea that blockchains may bring benefits in terms of cybersecurity is a widespread myth. Even the US Department of Defense fell for this myth in a recent report “DoD Digital Modernization Strategy ...
- Stablecoin Ethereum Flip Could Lead to Mass Adoption, Claims Binance CEOon January 30, 2020 at 11:13 pm
More in the cryptocurrency sphere have had a polarizing effect on the community since their emergence. Existing on Ethereum and other blockchains, many feel stablecoins are not true cryptocurrencies ...
- Intelligent transformation of the financial sectoron January 30, 2020 at 12:59 pm
Blockchain technology is considered by many to be the driving force of the Fourth Industrial Revolution. Blockchains represent one of the most disruptive technological innovations of the last twenty ...
- Protocol Delivers 'Fast, Secure Token Swaps' Between Blockchainson January 29, 2020 at 11:20 pm
A “warp speed” protocol allows tokens to be transferred between blockchains effortlessly without relying on a central custodian. A “warp speed” protocol is allowing crypto consumers to use tokens they ...
- Blockchain Foundry Activates World’s First Bridge Between the Syscoin and Ethereum Blockchainson January 29, 2020 at 5:32 am
The new protocol is a first of its kind. It uses cryptographic proofs between blockchains to enable a trustless bridge for token interoperability. This means that existing Ethereum projects can take ...
- BitDegree to Compete for 1M EUR in the Finals of EIC Horizon Prize for Blockchains for Social Goodon January 27, 2020 at 7:45 am
/PRNewswire/ -- BitDegree Scholarships' solution was selected to appear among the 23 finalists in Brussels and will compete for a 1M EUR prize in the ...
- Everybody’s Staking But Who’s Using Proof of Stake Blockchains?on January 26, 2020 at 5:15 am
The primary use case for staking blockchains is staking. That is their raison d’être, and thousands of cryptocurrency holders have utilized this provision to increase their holdings by earning staking ...
- Wanchain 4.0 Has Landed! This major milestone enables a new world of connected private blockchainson January 20, 2020 at 6:01 am
This release marks the accomplishment of one of the major goals of the Wanchain project as stated in the whitepaper released by the Wanchain Foundation— the integration with private blockchains.
via Bing News