Reducing Fraud in the Blockchain Community: As simple as it sounds?

Hackers, malware, and booby-traps are everywhere in the community of Blockchain. Fraud, though, is caused by the flaws of the security of Blockchain. Flaws such as decentralized mismanagement and security, and other things such as weak firewalls. But, how can blockchain developers completely eradicate the existence of fraud and other issues? Well, it’s not as simple as it seems.

Blockchain applications and systems are decentralized operating systems with no specific or main management system . Blockchain developers follow an audit system, the same way that transactions are stored in the data asset of the blockchain system. Since they follow an audit system, all edits can be changed with agreement and disagreement. The audit systems can also be altered but are still not governed by the same source or user. This can be an issue, though, for sake of the transaction information and transportation. Different attacks have been enforced against blockchain systems though, with different purposes, not all directed towards the decentralized management systems and organizations.

Figure 1.0

Blockchain communities have no specified central governing systems, which is the main reason why so many fraud and hacking attempts and issues have arisen during the age of blockchain. In Figure 1.0, it shows and describes the relations between the different governing systems and organization within a blockchain audit and portfolio. Without a centralized governing system, no party or dataset is able to track where and when the crypto-audit was edited or manipulated.

The only way professionals try to ensure that Blockchain is still feasible and secure, without a centralized governing system is by sharing files and blocks that are tamperproof. This may not seem feasible nor tangible at the moment, but decentralization is the main cause of hackers being able to tamper with files. Using tamperproof blocks means that the creator of that block and also the database of all the transfers have restrictions as well. Some restrictions may include not being able to edit the block more than a certain limit, or not being able to share the file and block among large populations of people.

In short, reducing fraud, or hacking in Blockchain, is practically near impossible, leaving us with non-feasible strategies and alternatives to solve the issue. Unless we are able to create a block that can restrict or prevent itself from being hacked by certain encryption codes such as a proxy, then it is near impossible to find the proper way to completely eradicate fraud.

Reducing Fraud in the Blockchain Community: As simple as it sounds? was originally published in Data Driven Investor on Medium, where people are continuing the conversation by highlighting and responding to this story.