Why can’t anybody hack a Blockchain?
Hacking Blockchain! Sounds next to impossible. But why? Let us know what makes blockchain so unique and special from others.
You might be wondering what the news headlines are actually trying to say when they depict a certain crypto currency collapsed or a particular coin or token was hacked.
Well, this is a common mistake that every newbie investor confuses themselves with. The hacking of any crypto exchange or platform does not imply that the blockchain associated with it was also hacked.
Blockchains are already tough technological shells to crack. It is not so that blockchain does not have any loop holes, but let’s save the debate for next time.
First things first; Blockchain is a shared, immutable chain of public ledgers that facilitates the process of recording transactions and tracking assets in a business network.
Yes, you heard it right. Shared + immutable. Despite being a public ledger where all the data for transactions is stored, nobody has access to the entries and can’t even think of manipulating them.
The builder of blockchain, Satoshi Nakamoto really did a commendable job creating such massive and valuable technology along with going an extra mile to protect this innovative invention.
In a world where cyber security has become a key issue for personal, corporate, and national security, Blockchain is a potentially revolutionary technology.
The four major characteristics of blockchain technology have spread its bliss globally and are making each segment convenient to access.
1. DECENTRALIZED SOURCE OF OPERATIONS :
The first is the efficiency of a decentralized system. Blockchain is an entirely decentralized network module that eliminates the need for any intermediary or middlemen. This way the process becomes more reliable and trustworthy, adding to the benefit of cost-effectiveness and efficiency. The most obvious examples are sending payments and banking.
2. SECURITY & TRANSPARENCY :
The second one stands to be the security feature. Just imagine, do you think a platform that is shared and viewed by all can ever contain any manipulation or fraud recorded? The answer is a clear-cut NO, right?
Blockchain is intrinsically a very secure technology. Its decentralized nature and cryptographic algorithm make it immune to attack. In fact, hacking a Blockchain is close to impossible with the transparency it provides.
3. HASHING ALGORITHM :
Every transaction that takes place on a blockchain is denoted as a block. When these single blocks are integrated together as a group of transactions, it becomes a blockchain. The blocks which contain specified transactions contain cryptographic elements that make them unique.
Each transaction has a specific hash associated with it also known as the transaction details or address. These hashes are visible in the blocks publicly. A hashing algorithm determines the details of the transaction.
For example, the Bitcoin Blockchain uses the double SHA-256 hash function, which takes transaction data and hashes/compresses it into a 256-bit hash.
In a chain, each block consists of specific data from the previous block. In this way, even if an attacker reverse-engineers the hash, the resultant block will be out of sync with the rest of the blocks since it will have a different hash output, causing the system to reject it.
4. 51% OF IMPROBABLE :
A 51% attack occurs when more than half the computing power or mining hash rate on a network is controlled by a single person or group of individuals.
Increasing hash power makes blockchains less susceptible to 51% attacks as they grow in size and attract new users. This becomes prohibitively expensive at a certain point. As a result, a scenario like that is unlikely, given the size of established blockchains like Ethereum and Bitcoin.
I can almost hear you thinking, what if a person manages to arrange that many resources that can help him manipulate the previous entries, will he be able to reach the threshold of hacking the Blockchain?
Not even in his sweetest of all dreams. However, despite gathering sufficient resources to influence an already existing transaction, there is no way of controlling the new ones, as each minute or maybe just when you blinked right now, a new transaction is recorded.
This constant upgradation makes it nearly impossible to hack the Blockchain, unless somebody finds a superior technology than this.
CALL TO ACTION:
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