Why Blockchain Matters In Cybersecurity And In Open Internet
Blockchain can be used for protecting personal data. It provides identity protection solutions that can be more effective than the existing password-based security as well as multi-factor authentication
Blockchain has been among the most talked-about technologies by not only the mainstream public but also business leaders in recent years. However, very few practical applications of blockchain have materialised except in the domain of cryptocurrency like Bitcoin. Blockchain is yet to be tested and used in a context outside of cryptocurrency. However, the technology holds great promise in many fields, from healthcare to law and beyond.
Theoretically, the innate characteristics of blockchain—immutability, decentralisation, traceability and transparency; can be leveraged through numerous real-world applications. Blockchain and smart contracts, which is enabled by blockchain networks, can improve many existing business applications to make them more streamlined, efficient, and secure. And this possibility has been vehemently propagated by the online tech community in recent years, creating the impression that it can solve every conceivable technological problem. Such unrealistic expectations have been among the leading reasons why 98% of blockchain projects have been reported as failures. These inflated expectations also exist when it comes to blockchain’s cybersecurity applications.
Blockchain’s Role in Cybersecurity
Blockchain is viewed by many as an omnipotent cybersecurity solution and as a means to secure critical data. While it may not be as versatile as people think, blockchain does serve as a secure repository of critical data that cannot be compromised using conventional means. Blockchain uses what is known as a cryptographic hash function which generates a unique string of characters and numbers corresponding to your critical data. And this hashed data can only be decoded with the original cryptographic key that is private and thus hard to replicate. Using a cryptographic hash function, the data pertaining to transactions taking place on a blockchain network can be secured from unauthorised access.
Blockchain-based identity management is a burgeoning field that is expected to grow at a rate of 84.5% by the year 2023. That’s because blockchain-based identity protection solutions can be more effective than the existing password-based security as well as multi-factor authentication.
On the one hand, password protection is becoming increasingly ineffective against evolving identity theft attempts leading to the need for more advanced ways to secure identity. On the other hand, multi-factor authentication – while being more secure than basic password protection – adds extra steps to the process of verification, causing inconvenience creating bottlenecks in processes. However, identity theft is a highly expensive problem to deal with identity theft crimes cost US$ 4 billion in 2018. Thus, the need for improved identity and access management for both individuals and businesses will increase in the coming years. Thus, blockchain can become a mainstay enabler of secure yet convenient identity management systems.
Blockchain can be an invaluable asset in combating identity fraud and securing financial transactions. Decentralised identity is a concept that is being rigorously explored in recent years as means to control identity fraud and ensure that people take
In addition to securing critical bits of information, blockchain can also be used for protecting personal data used for authorising individuals to access different services
total ownership of their personal data. To that end, leading organisations like Microsoft are exploring the use of blockchain- enabled decentralised identity. Decentralised identity can potentially replace all existing means of authorisation that rely on email IDs, phone numbers, and passwords. This will enable users to have a globally unique digital identity they can use for accessing any service through digital platforms without having to go through verification ordeals. Such systems will have security and trust inherently built-in eliminating any opportunity for identity theft.
Blockchain’s Role in Keeping the Internet Open and Neutral
The shift towards decentralisation and democratisation driven by the rise of blockchain is also lending impetus to the global push towards creating an open internet. The Internet should ideally be an open community equally accessible to all individuals and organisations, regulated by no single entity. However, an open Internet, while being favourable to continued progress and collaboration to drive technological and economic growth, can also become a medium for conducting unlawful activities without enforcement. And this may cause some unrest among people. There is a threat to net neutrality, due to Internet service providers (ISP) who have the power to restrict or favour access to websites of their choosing, hampering fair competition.
Blockchain can potentially act as a solution to ensure an open, neutral Internet. Since blockchain can essentially record any piece of information in a way that is immutable and visible to all, it can be used to monitor ISPs and their allocation of bandwidth resources. This way, any wanton manipulation of bandwidth can be detected and, eventually, deterred
While blockchain holds the potential to revolutionise privacy, security and the Internet itself, it is important to understand that blockchain is still in the early stages of its development. Although it may be well worth the hype surrounding the technology, blockchain faces a few challenges that make it presently impractical to be used in fields beyond cryptocurrency. For instance, blockchainbased identity management systems can only work feasibly when adopted as a platform used by a large volume of users and nodes. However, the technology currently cannot be scaled to be efficiently operated by a large number of users. Using blockchain in its existing state cannot handle the speed demands of mainstream applications. For instance, the Bitcoin blockchain can handle only 7 transactions per second, which is much slower than the current centralised transaction and security systems.
It is right to be enthusiastic about a blockchain- driven future, which may allow us to enjoy unprecedented benefits, in terms of security, convenience, as well as financial gains. However, as businesses, it is important to be cautious while considering blockchain-based applications for critical functions like cybersecurity for at least a year or two now.