A post similar to this one originally appeared on the UMSA blog in October 2017. Updated: April 2019.
As pointed out by United States defense analysts, an increase in threats to the country’s national security has led to the Pentagon experimenting with blockchain technologies over the last few years. So has the United States military, using the technology to prevent potential terrorists and hackers from compromising military networks. Despite its increased use by the government and military, blockchain has remained in the experimental phase in many large companies. Most recently, it has started gaining traction in the realm of startups and major technology vendors. Blockchain, cryptocurrencies, etc. aren’t going anywhere. That said: what is blockchain technology and how has it – or will it – impact the cybersecurity industry?
In simplest terms, blockchain technology is a distributed database which maintains a list of ordered records. These records are called “blocks” and can represent many types of transactions and data, including currency, digital rights, identity or property titles. The list maintained by the database is continuously growing and is used by a network of computers to agree on the state of a distributed ledger at regulated intervals.
According to Christian Catalini, MIT Sloan assistant professor, these ledgers contain many different types of shared data, including transaction records, credentials and attributes of transactions and do not require traditional networks to be secured. These transactions are then recorded chronologically by blockchain technology, creating a “chain.”
Bitcoin was the first major blockchain innovation, a digital currency created in 2009. The blockchain technology used by bitcoin allows the currency to transfer value across the world without the use of banks and is used by millions of people for payments.
Benefits for businesses
Blockchain technology offers many benefits for businesses. Three key benefits include faster transactions, increased transparency and a trustworthy system.
Businesses and organizations engage in many types of transactions on a daily basis. Implementing blockchain technology allows these transactions to take place at a quicker pace, since there are no oversight requirements. Overhead transaction costs are also lowered or eliminated since blockchain removes the need for third-party involvement.
Any changes made to data built with blockchain technology is readily accessible to all team members because its ledger structure. This creates a transparent system with data that is complete and consistent with all members.
Data security start-ups, such as Guardtime, employ blockchain to detect and protect the compromise of information systems from cyberattacks. Since blockchain technology allows data structures to be built in a way that makes users verify transactions without third-party involvement, any type of unauthorized intervention is less likely to occur. Historical data is also less possible from outside sources and can only occur if a large team is working simultaneously across data centers.
Blockchain technologies are the culmination of decades of research and breakthroughs in cryptography and security. It offers a totally different approach to storing information, making transactions, performing functions and establishing trust, making it especially suitable for environments with high security requirements and mutually unknown actors. Because it is still in early stages of development, blockchain can be a difficult technology to understand and its influence on the future of cybersecurity may be tough to predict. One thing is certain: it will likely continue to become a key player in the exchange of information through online platforms as well as both digital and physical goods in the years to come.
If this piqued your interest in blockchain, cryptocurrencies and cryptomining, be sure to attend David Duccini’s session at Secure360 2019 on Tuesday, May 14 at 10AM: “Blockchains in the real world: Patching to produce.” Online registration for this can’t-miss event ends May 10, so register today!