Myth or not? Aspects of blockchain immutability
As it is with every new piece of technology, the tales about blockchain are endless in numbers and in their scope as well. It is true, though: this technology is premier among all, since it was the one that gave birth to cryptocurrencies, but it also resolved various security issues. The most prominent question asked about this technology is the immutability of a blockchain, so let’s see what it is all about.
What is blockchain immutability?
Simply put, immutable means unchangeable. Immutability, i.e. the ability for a blockchain ledger to remain a permanent, indelible, and unalterable history of transactions is a definitive feature that blockchain evangelists highlight as the main selling point. This functionality of blockchain technology ensures that no one can “hack” in the system or change the data saved to the block. Each block of information, such as facts or transaction details, proceed using a cryptographic principle or a hash value. It is also important to know that blockchains are decentralized and distributed in nature, where a consensus is made among the various nodes that store the replica of data. This consensus ensures that the originality of data must be maintained.
How is this immutability achieved?
Today, generating a cryptographic isn’t as painful as it used to be, since modern programming languages are provided with several hash functions. With these, you simply need to pass a set of bytes and the function will return a checksum signature. For example: the SHA-256 is popular in the blockchain space. The functions that are used in this case are generating a string of 64 characters. Irrespective of the size of the input, you will always get the same fixed length of string, which is also referred to as the digital signature. This digital signature points to the exact data that you input. The key benefit of this hash that you can’t reverse-engineer it. It means you will not be able to use this output string to find the input data. In this system, transactions verified by a blockchain network include blocks of information embedded with timestamps, which is secured by a hashing process. It links together and incorporates the hash of the previous block.
Okay, so can we summarize it with a simple equation-like statement? Glad you asked:
Cryptography + Blockchain Hashing Process = Immutability
In other words, if data is tampered with, the blockchain will break, and the reason could be readily identified. This characteristic is not found in traditional databases, where information can be modified or deleted with ease.
The advantages of such system
So, why does this matter at all? Here are some examples:
- auditing simplified — being able to procure the complete, unaltered history of a transactional ledger allows for an easy and efficient auditing process. You can easily prove that your data has not been tampered with is a major benefit for companies that need to comply with industry regulations.
- full data integrity — ledgers that deploy blockchain technology guarantee the full history and data path of an application: when a transaction joins the blockchain, it stays there as a representation of the ledger up to that point in time. The integrity of the chain may be validated at any time by simply re-calculating the block hashes
- proof-of-fault — disputes in a business transaction are way too common to ignore. In fact, the US. construction industry, for example, accounts for 1 trillion USD in losses as a result of unresolved disputes. Blockchains could be leveraged to prevent a majority of disputes related to data integrity and other related issues (basically by proving who did what and at what time)
Challenges and shortcomings of the blockchain immutability — the 51 percent and quantum computing
With all its benefits, the most often cited week points are the possibility of a “51 percent attack” and the emergence of quantum computing. The former term signifies that an attacker can acquire huge computing power over all other members of the network. Miners together can achieve immutability of the blockchain system by just creating a majority of hashing power. This allows attackers to alter the transaction data that is supposed to be “immutable” first. By this facility, attackers can reverse the high-value transaction, spend the money the second time, and secure the profit. The latter was asserted by experts at IBM: quantum computing has the ability to reverse-engineer the public key of the blockchain network, which can find the private keys to break the system.
As far as the solutions are concerned, there are the following: the 51 percent attack can be tackled by creating a stronger protocol and by using a consensus algorithm such as delegated proof-of-stake, since it is hard to stake numbers of tokens on a network instead of renting out computing power. As far as the quantum computing is concerned: application developers have recommended integration of quantum cryptography into the core of blockchain. However, these solutions are rather futuristic as of now.
