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Enterprise Security Magazine | Tuesday, January 31, 2023
Companies shifting their cyber security practices from traditional to blockchain-based ones need to account for potential data security, scalability, and regulatory issues.
FREMONT, CA: Blockchain-based cybersecurity is becoming the next big thing, with multinational corporations and governments all clamoring to implement it. The process is not as straightforward as updating a toolkit.
The integration of blockchain and cybersecurity is still in its infancy. Identifying digital identities, securing edge devices, and creating smart contracts are not always aligned with business needs. An implementation that lacks careful consideration can prove infeasible or even impractical.
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Organizations considering blockchain a cybersecurity strategy may encounter some of the following obstacles.
Data privacy: Anyone can view and retrieve data in transactions on a public blockchain. The public availability of information is a concern for businesses.
Permissioned blockchains can mitigate many privacy concerns. The enterprise blockchain platform can create a permission-ed network where only trusted parties can participate in transactions or view them.
Scalability: The size of blocks and response times can constrain scalability when implementing blockchain. This technology ensures security and privacy by storing, processing, and maintaining transactions in blocks. Businesses of all sizes struggle to accommodate increasing transactions in a block as the number of transactions increases, and these increases can also slow down the validation process. Scalability is at odds with decentralization when computing and storage resources are limited.
Regulations: Data privacy, compliance, and regulatory landscapes are still evolving, and organizations are experimenting with blockchain's structure and complexity. Data protection laws, like the General Data Protection Regulation (GDPR), allow individuals to request the deletion of their data; these laws also create a "right to be forgotten" in certain circumstances. Blockchain technology is risky due to its ability to prevent parties from altering or deleting data.
Interoperability: Many blockchain platforms utilize a variety of transaction schemes, consensus models, and smart contract logic. The lack of interoperability can limit scalability. Developers can also encounter roadblocks due to platform configuration errors, communication breakdowns, application specification errors, and problems with cross-chain smart contracts.
The advent of open protocols, multichain frameworks, and algorithms has mitigated this issue for the better. IBM and Microsoft are working together to incorporate global standards for blockchain interoperability into their enterprise blockchain applications, according to business communications organization GS1
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