How to protect data on the blockchain: Six principles of security

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How to protect data on the blockchain

Blockchain is advertised as one of the safest technologies in which a high degree of data encryption is used, which almost completely protects them from unauthorized and unfair changes. Despite this, security threats exist. They can be avoided by following the principles below.

 1. Storage of cryptographic data checksums

Instead of storing the original content directly on the blockchain, ideally, you should follow the principle of mirror data storage when only the cryptographic checksum (or mirror image) is on the network. In this case, the hash value of the source data corresponds to this mirror data.

2. Secure storage of cryptographic keys

Access to the blockchain is regulated using private cryptographic keys. Of course, they should be stored in a safe place and not catch the eye of scammers, and just outsiders. Saving them in plain text files or using them in unencrypted form on devices threatens security, because attackers can gain access to keys through spyware. Do not do this if your data is important to you.

3. Protection settings against breaking the blockchain using brute force and 51% attacks

The decentralization of the blockchain, which is constantly talked about, raises doubts: for example, a small number of large miners control most of the blockchain networks of Bitcoin and Ethereum, the most famous cryptocurrencies. If consortia of miners in any way receive sufficient computing power, they will be able to take control of the network with brute force and change the data stored in it. Although a clearly reliable system of protection against such threats has not yet been developed, 51% have ways to prevent attacks. This is a transition from the more vulnerable Proof-of-Work consensus algorithm to Proof-of-Stake, an increase in the number of necessary confirmations and other methods.

4. Checking the quality of the blockchain network code

The blockchain code requires control by experts, and the scalability of the network is also worth checking before trusting any information to it. Poor-quality code creates threats that are easy to avoid if testing is done on time.

5. Verification of supplier credentials

As more and more third-party solutions become available for storing funds in smart contracts and wallets, the risk of losses due to errors of such suppliers increases. Check the reputation of projects before using their blockchain solutions.

 6. Verification of web certification

Last, but not least, blockchain transactions will become much safer if you always check that the security certification and the extension of the HTTPS protocol are indicated correctly in the address bar. This is a very good habit.

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