What is a security protocol?
The different security protocols on which the various coins and tokens are based, might endanger the entire network as the other layers of protection (see: Exchange Platform and Wallet) will necessarily be corrupted in case of a breach in their algorithms.
Indeed, when you decide to acquire a cryptocurrency you must accept and understand the inherent risks of the protocol. While some Blockchains have proven their worth in terms of security and offer an adapted protocol, other independent networks, often with a lower Market Cap ranking, still have to demonstrate their reliability.
If these few sentences are like decrypting ancient hieroglyphics, I invite you to consult our section: The different security protocols.
Generally speaking, there are 2 scenarios:
- The asset evolves on its own Blockchain, we will then speak of a Coin or Altcoin (Alternative to Bitcoin). The main ones being: Bitcoin, Ether and Ripple.
- The asset evolves on an already existing Blockchain we will then talk about Token.
In both cases, contrary to popular belief, it is theoretically possible to modify the database of a Blockchain. However, as you know, if you have followed our different sections, the large number of “Minors” lending the computing power of their processors make the task very complicated for the Hackers. The Blockchain being constantly controlled, this would require both, a higher computing power than the entire network to add Blocks faster than the real Blockchain, but also, depending on how the hash is calculated, a modification of the entire existing Blockchain. So you’ll easily understand that depending on the scale of the network the difficulty will increase proportionally .
51% attack or “double expenditure”, the underlying principle is simple:
The hacker who has created his own parallel Blockchain will make cryptocurrency purchases on the original Blockchain by disabling the last block and replacing it with a version where he would not have purchased these Coins.
Example in video: https://www.youtube.com/watch?v=6luEMwSAS0I
A newly created Blockchain with a small network of Minors will be much more vulnerable to this type of attack. It cannot go unnoticed since it will quickly lead to the collapse of the Blockchain and cause a drastic drop in its value.
Nevertheless, some Blockchains with a large network have been victims of such attacks.
Here are some recent examples that prove that a technology, however advanced it may be, is never completely safe from a cyber-attack:
– Verge: In 2018, the Blockchain was the victim of two successive attacks that resulted in the theft of $1.1 million and $1.51 million
– Bitcoin Gold: The same year about 17 million dollars were stolen, resulting in a 20% loss in value right after the attack announcement.
Concerning the blockchain of bitcoin you can rest assured that an attack will not happen soon…
Here is the estimated cost (in real time) of a 51% attack on the Bitcoin Blockchain:
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