From healthcare to supply chains, the decentralized nature of blockchain has the potential to fundamentally restructure the way organizations do business. Once fully implemented, it will also make the internet far more secure against cyber attacks – and give users greater control over their personal data.
How Does Blockchain Make the Internet More Secure?
Centralized networks are often vulnerable to cyber attacks because they tend to have few IP addresses, which hackers can easily penetrate using relatively simple schemes such as phishing. Once in, cyber criminals can do extensive damage, as recently demonstrated by waves of ransomware attacks costing companies an average of $4.24 million USD. However, the decentralized nature of blockchain presents a possible solution, as these complicated networks are far more difficult for hackers to access.
“For those blockchain solutions utilizing proof of work validation methods (such as bitcoin), hackers have to gain control of a majority of nodes to compromise ledger transactions — something that is, by design, computationally expensive,” Robert Napoli, a business strategist who writes about cybersecurity and digital transformation, wrote in Forbes. “This computational cost can be extended to other types of operations in a security scheme, reducing the need for a trusted central authority.”
Transitioning internet domain name servers (IDNs), which link web browsers to websites, to the blockchain, for instance, would disperse resources “to multiple nodes, making it infeasible for hackers to control the database,” Napoli adds. He noted that blockchain can be secured even further with the help of artificial intelligence technology.
Blockchain, Decentralized Identity, and Digital Identity Wallets
Aside from making networks more secure, blockchain technology can also give users a decentralized online identity that shields their personal data against breaches. According to Deepak Gupta, a cyber security innovator, tech strategist, and cofounder of LoginRadius, writing in VentureBeat, a decentralized identity “is based on a trust framework for identity management. It allows users to generate and control their own digital identity without depending on a specific service provider.”
With a decentralized identity (DID), users have digital “identity wallets” that store proof of their identity in a single location, which they can use to grant or deny access to third parties on the network. Not only do identity wallets give users an easier, more secure way to share their information, they also give users greater power over their own data.
According to Gupta, authentication through decentralized identity and blockchain include the following steps:
- The identity wallet contains the user’s verified identity details, including their name, age, address, education, employment details, and financial data. This creates a foundation of trust and confirms the user is eligible for authentication.
- The decentralized identity feature uses the public key associated with the private key and publishes it onto a distributed ledger like blockchain.
- As the decentralized system delivers the public key to the blockchain, the identity wallet receives a unique decentralized identifier representing the user across the internet.
- The user shares this identifier with the service provider to get authentication.
- The service provider seeks the shared identifier in the blockchain. If and when this is found, the blockchain then sends matching data to the application. The user then completes authentication by adding a signature using a private key.
The service provider application verifies authentication, allowing the user to take action.
The decentralized nature of blockchain has the potential to revolutionize cyber security, but will also come with radical changes. Is your organization prepared to take on this complex technology?
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Gupta, Deepak. (5 March 2022). Decentralized identity using blockchain. VentureBeat.
Napoli, Robert. (4 March 2022). How Blockchain Could Revolutionize Cybersecurity. Forbes.
I believe this will help in online sales as consumers will give more trust after having trust online. This will help a lot of businesses, and also the consumers