Human error as a limitation for Blockchain adoption?
While Bitcoin has become a buzzword in today’s market, the technology behind it, Blockchain, serves as a platform for much more than just a digital currency. Ethereum, proclaimed “version 2.0 of Bitcoin” shows that distributed ledger technology is disrupting the concept of value through enabling allegedly secure and trustworthy transactions of assets. Nevertheless, news such as the Bitfinex hack or the more recent Bithumb hack reveal that certain deficits are standing in the way of a mass adoption of Blockchain. This paper discusses weaknesses related to human error, focusing on users and developers and proposing improvement approaches.
Firstly, it can be said that Blockchain involves different parties, whether they are developers, speculators, users or even hackers. The effect of developers making mistakes when writing code for Blockchain applications is demonstrated by the recent software bug of Parity’s wallet. While searching for bugs, a person accidentally became the owner of several wallets and disabled the code that could have saved these in an attempt to reverse the error. It is unclear whether the loss (estimated at $150m-$300m) can be recovered. Naturally, such publicly discussed errors are preventing the usage of Blockchain by risk-averse people.
When it comes to the users, the inalterability of Blockchain is considered to serve as protection against manipulative attempts. Nevertheless, there are voices that think that this inability to change data will serve as an impediment. For instance, Richard Lumb of Accenture stated that even smart contracts were prone to human error and that even the most sophisticated IT architectures would lead to results that demand reversible consequences. His thesis is supported by EU’s so-called “right to be forgotten ruling”. Should the 1995 Data Protection Directive apply to Blockchain as it does to search engines, an EU citizen could require the removal of inaccurate or inadequate data. Hence, human error in the light of “inaccurate” data being transferred constitutes an impediment in the light of EU’s data protection regulations.
When discussing opportunities for improvement, educating users and developers is a first very important step in reducing human error. The Bithumb Hack was e.g. only possible through voice phishing. Users need to be aware of multi-factor authentication and of how the technology works in order to prevent phishing attempts. Simultaneously, developers have to be educated to provide secure platforms and minimize bugs. One example of up-to-date expert knowledge is at RIAT-Institute for Future Cryptoeconomics that provides education in the form of the Blockchain Academy through workshops, extensive trainings and consulting.
In an informal interview conducted with a representative of RIAT, he stated that errors in the Blockchain itself were rare, but would rather occur at the interface with websites, wallets etc. offered on different platforms. Consequently, education of both users and developers should serve as a basis for minimizing human errors and by that, allow the increase in Blockchain adoption.
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