Blockchains, Cryptocurrency, and Smart Contracts Technologies: Security Considerations

BlockchainBlockchain was originally blockchain, a continuously growing list of records, called blocks, which are linked data blocks and secured using cryptography. Today’s block contains a cryptographic hash of the previous block, a timestamp, and transactionTransactions data, and it is represented as a Merkle tree. TransactionTransactions data consists of transactionsTransactions. The data from each block hashes into a unique cryptographic number—a hash—as it links onto the next block. The unique number or hash makes each block on the blockchainBlockchain immutable. This means a block of data on the blockchainBlockchain can never be changed again. Thus, blockchainsBlockchain are inherently resistant to modification of the data. The blockchainBlockchain is stored in a distributed peer-to-peer network of servers, and any transactionTransactions, between any two or more parties, that uses the data in any of these blocks must be approved by a majority of all network servers using efficiently verifiable protocols. Once recorded, the data in any given block cannot be altered retroactively without the alteration of all subsequent blocks, which requires collusion of the network majority. This last feature of decentralized consensusConsensus, possessed by the blockchainBlockchain technology, gives it broad appeal in a variety of areas requiring recording of events such as medical records, all types of records management activities, such as identity managementIdentity management, transactionTransactions processing, documenting provenance, food traceability or voting. In this chapter, we discuss all these applications, security issues, and the future of blockchainBlockchain technology.