Blockchain, known as Distributed Ledger Technology (DLT), is used for preserving the history and integrity of digital assets through the use of cryptographic hashing and decentralization techniques. The decentralization of the transactions makes them transparent and hard to alter.
Blockchain? What about
The digital data is stored in a block of several cryptographic databases or “chains” that are interconnected through peer-to-peer nodes.
Each block carries a number of transactions and whenever a new transaction takes place on the blockchain, a record of that is added to every participant’s ledger. Essentially, each database stores a copy of the most up-to-date version of data. User can control themselves instead depending on third party
Blockchain Tied Bitcoin Network
Whenever we talk about blockchain, it always leads to talk of Bitcoin. That’s because blockchain technology is a foundation for cryptocurrencies like Bitcoin.
A Bitcoin is a decentralized, public ledger with no third party controlling it. Any Bitcoin owner can participate in this network, and send and receive Bitcoin as well as hold a copy of the ledger if they want to.
To say that a Bitcoin ledger is transparent would not be an understatement. As such, the Bitcoin industry relies on blockchain technology for safe and secure exchanges and for keeping the end users’ digital wallets safe.
Can Blockchain Be Hacked?
Once touted as unhackable due to its non-altering characteristics, the blockchain has recently started becoming a target of hack attacks as well.
Most people think of a hack attack as exposing private information to the public but this does not apply in the context of blockchain: it’s already public and decentralized. Blockchain transactions are posted to a public database that anyone can review, making it more secure as everyone must agree before changes are made.
It is this lack of privacy that is considered a benefit but also poses a big concern for privacy reasons. Unfortunately, some recent attacks like the 51 percent attack, Sybil attack, and Timejacking have proven that blockchain technology is a target for hackers.
How Do Hackers Attack
If there are security glitches or mistakes during the creation of the blockchain then it can lead to potential hacks. The larger and more intricate a blockchain is, the more vulnerable it is to hack attacks.
The organization that runs Zcash—a cryptocurrency that lets users carry out private transactions by employing extremely complicated math—revealed that they had discovered and fixed a slight cryptographic flaw. If Zcash had not been able to patch it, a threat actor could have exploited it by carrying out an attack.
Weak Security Practices
Weak security practices around exchanges can offer hackers a chance to infiltrate the Blockchain. Most blockchain hacks have happened on exchanges as it is the main platform for users to trade cryptocurrency. If practises are weak then hackers easily access the data
Blockchain is built to sustain DoS attacks but if each node in the blockchain network is individually targeted by DoS attacks, it can certainly have an impact on the overall security of a blockchain.
Transaction-Based Injection Attacks
By taking advantage of poor input sanitization, injection attacks exploit weaknesses in a Blockchain by using malformed and malicious input. If there exist a Vulnerability in the software transaction then it will ruin the whole node
The 51 Percent Attack
This is the most common type of attack where a situation is created that lets the hackers control more than 51 percent of the computing or hashing power within a blockchain network.
During normal cryptocurrency transactions, all “miners” or users review transactions to ensure their integrity. However, if a hacker gains control over half of the transaction process, then it can wreak havoc on the blockchain.
The hackers can create a second version of the blockchain, or a “fork”, where certain transactions are hidden and tampered with and later presented as the true version of the blockchain when in fact they are fraudulent.
Typosquatting normally involves the creation of fake websites that allow threat actors to collect user data and access their personal accounts. Individuals may be tricked into entering a website disguised as a crypto exchange.
Once the users enter their credentials, they unknowingly hand access to the hacker who now has control over the wallet.
Phishing attacks are generally carried out by tricking victims into clicking on malicious links and sharing their personal data. Phishing is the most popular hacking technique where emails and messages are disguised as coming from legitimate sources.
Similar to the DoS attacks, Sybil attacks take place when the majority of the nodes are controlled by one entity but are full of multiple requests coming from forged identities.
The multiple forged identities prevent legitimate requests from coming through, causing a system crash.
Most blockchain attacks are carried out by individual hackers and the complicated technology behind blockchain makes it very hard to infiltrate. Caution required when handling cryptocurrency based transaction. One Vulnerability is enough to infiltrate by the hacker .