2026 update: Block chains are susceptible to cracking by Quantum computing and AI systems. Both have become very real over the last couple of years
Many of you have heard from 'experts' that Block Chain is the future of secure transactions. Before you go down that road, read this article so that you understand the risks that you may be taking and how to avoid tanking your business.
So what is Block Chain
In simple terms, block chain is a way to distribute transactions across a network of computers or nodes. Often as in the case of Bitcoin, these are public computers that are owned by...well... anyone. The key to what makes these distributed transactions so secure is the encryption on each node. Each transaction is recorded on multiple nodes. When its time to read the transaction, each node gets a vote. If a node has a error or has been tampered with, the readout of the transaction will be different for that node. Each of the nodes are tallied and the majority wins. People familiar with this technology will understand this is a gross simplification; but it will suffice for the purposes of this article.
Note that almost any document can be stored as a Block Chain transaction. In truth this is an elegant and wonderful technology in that hacking the chain itself is tough. That said, think about some of the consequences of this technology.
Attributes of Block Chain stored data (in a public cloud)
1. Your data is stored on multiple machines that you have little or no control over
2. Removing data distributed to the Block Chain is almost impossible. Even if a particular implementation allows for removal of the data, you can't guarantee that all nodes will be online at any point in time.
3. If someone found a way to break the encryption on a super majority of the nodes, or discovered a way to read the data in a single node without disturbing the Block Chain, then your data security is gone.
4. Worse, even if they haven’t compromised your chain, the existence of such a technique renders your block chain next to useless.
5. Per #2 above, you can’t retroactively protect the data you’ve already stored in the block chain.
How big is this risk?
Unfortunately, it’s pretty much a guarantee due to recent advances in Quantum Computing. Current encryption techniques depend upon computationally difficult keys. With sufficient computing power its possible to crack these encryptions. This is why we've shifted from 128 bit keys to 256 and even 512 bit keys. Quantum computers allow all potential solutions to a problem to be examined at the same time. This is weird behavior to most folks because we live in a ‘classical – cause and effect’ world where each solution must be tested one at a time. Quantum Computers don’t obey the rules we're used to. To be honest, even most Physicists have problems thinking in terms of these concepts. This is why so few folks have sounded the alarm regarding the risk to encryption technologies. Block Chain’s distributed nature just compounds the problem.
You can expect Quantum computers to be in use around the world by bad actors (foreign governments, criminal organizations, etc.) within ten years plus or minus a few. If you think we've had trouble with Russian hacking of elections in the US and Europe, wait until Quantum computing comes along. That and advances in Artificial Intelligence technologies will make this a very interesting world over the next decade or two.
How can you protect yourself?
Don’t store your block chain transactions in a public cloud. You really need to maintain full control over the nodes in your Block Chain. That way if someone invents a clever way to secure transactions against quantum computing, you can upgrade your block chain with full confidence that you updated all nodes.
Summary
I'm not saying that Block Chain doesn't have its uses. I'm not sure I'd invest in Bitcoin; but non-sensitive data that you only need to secure for a few years can certainly use Block Chain on a public cloud. If your data will be on a private cloud, you are fairly safe. Just be aware of the level of risk your business can accept in ten years and base your decision on that.
Best regards
Peter Beery, Ph.D.
Originally published on LinkedIn.
