How to hack blockchain?
What was the main reason that blockchain conceptualised? Was it to create a framework for cryptocurrencies, was it to take down financial organizations around the world, was it to make the world a more open and decentralized place. What was it?
In particular, the reason is quite simple, — that is to enable people who don’t trust one another to share valuable data in a secure and tamperproof way. It is known that blockchain uses sophisticated mathematics and innovative cryptography along with software rules to make it extremely difficult for attackers to manipulate. But humans are skilled cheaters, and in real world things can get real messy where even the best-designed blockchain systems can fail when it comes into human contact.
As is known, there are two major things that makes a blockchain tamperproof: That is, a cryptographic fingerprint unique to each block, and a “consensus protocol,” by which the nodes in the network agree on a shared database of transaction history. The fingerprint in this case is called a hash, which takes up lots of computing power and tome to generate. It serves as a seal that a block added on the blockchain is valid. This is where the verification feature of blockchain comes into play. Which enables to verify whether the hash which has been generated matches its block. Once this is done, all the copies of that particular blockchain is updated with the new block. This is whats called consensus protocol.
Now, lets explore some ways how you can cheat the blockchain systems. For example, assuming that a system works like a bitcoin blockchain system does not mean that it will be as secure as the bitcoin blockchain. Since, all of these systems are created by humans, they are error prone. Even the most experienced developers can put tried-and-tested cryptographic tools together in a way which is not secure.
Another instance was put forward by Emin Gün Sirer and his group of colleagues at Cornell University. They showcased that there is a way to subvert the blockchain even if you have less than half the mining power of the other miners and getting the other nodes into wasting time on already solved crypto puzzles. Read this awesome interview by Emin Gün Sirer on “Why bitcoin is not a good store of value”
One more possibility that occurs is of an “eclipse attack”. It is known that nodes on the blockchain must communicate constantly with each other in order to take control of one’s node communications and fool it into accepting false data that appears to come from the rest of the network can trick into wasting resources and faking transactions. It is also observed that the cryptocurrency hacks that makes headlines happen at the point where blockchain systems connect with the real world — for examples, in software clients and third party applications.
It can be stated that the most prone to attack touchpoint between blockchains and the real world are “smart contracts”. For example, in 2016 hackers exploited an error in a smart contract to steal 3.6 million ether from a DAO. Since, DAO was on blockchain, the ethereum community had to push a “hard fork” to get the money back.
One might say since all the copies of blockchain are kept on a large and widely distributed network of nodes, there is no weak point to attack, and it becomes hard for anyone to build up enough computing power to manipulate the network. But recent work by Sirer and colleagues that not even bitcoin is as decentralized as one might think. According to their research, top four of the bitcoin mining operations had more than 53 percent of the system’s average mining capacity.
In the end, I would just quote that secure is a very heavy word to. Define in the context of blockchain. Only time will tell.
