Blockchain development challenges

The currently widely discussed blockchain technology is a prime example of an attempt. it helps to find new paradigms of interaction in the digital world. The only real example of blockchain development services at the moment is cryptocurrencies.

The architecture of systems with cryptocurrencies is built on the basis of their rather specific conditions. In which they are used, namely: the absence of a single control center, anonymity (or pseudonymity of users). In this case, it is necessary to use a mechanism that can replace the traditionally used trusted third party (administrator). It ensures interaction between users. Such a mechanism, implemented, for example, in the bitcoin cryptocurrency, uses a publicly available distributed. Or more precisely, replicated (i.e., located in identical copies of users) register of transactions performed in the system.

The registry is built in such a way that it is computationally difficult to make changes to it. This is achieved through the use of cryptographic mechanisms in the formation of the registry. There are hashing functions and electronic signatures.

Since there is no administrator in the system who is authorized to make changes to the registry. In fact, these are some probabilistic algorithms. That is, algorithms whose execution time is not deterministic. It allows you to select a temporary administrator to perform the current operation.

In practice algorithms are used for finding solutions to some computationally complex mathematical problems. For example, finding the value of a hash function from a given range.

Attempts to use blockchain in other areas related to already existing financial and legal relations. It’s registration of rights, control over the movement of goods, etc. They are faced with the fact that such architectural solutions are not adequate. So they are not used to the task facing the developer. It requires a change in the structure of the system and find more.

For example, the need to authenticate subscribers makes it superfluous to use the consensus mechanism. They are  described above, using a proof-of-work method.

In this regard, the biggest problem for blockchain technology is massive attempts to implement it. It’s where it is impractical. It’s used for most of the modern options for its application. The answer to the question whether it is possible to implement a similar system without a blockchain will be positive. Moreover was made the analysis. It showed that the decentralized blockchain in its modern form is not suitable for use in large-scale high-load systems. It’s due to natural performance limitations. The difficulty of reaching consensus and the need to store large amounts of data.

In the case of using its centralized (partially centralized) options, the characteristics of information systems are obtained worse than the characteristics of the systems currently in use.

Blockchain technology implementation problems

Diagram for choosing a blockchain option for implementation. 

Closed private blockchain. Only authorized users have access to the registry (read and write). 

Closed public blockchain. Authorized users can write, all users can read. 

Open public blockchain. All users have access to the registry.

From the point of view of information security issues, it is necessary to consider two aspects of blockchain security. These are theoretical and practical. Theoretical, first of all, is associated with the general scientific lack of elaboration. It consists of the rationale for the safety of consensus protocols.

To sum up

From a practical point of view, modern blockchain systems are developed by enthusiasts. And often they have serious vulnerabilities. It allows hacker attacks. This is more true in the field of cryptocurrencies. Attacks on cryptocurrency exchanges and individual users are widely known. They are aimed primarily at stealing data from cryptocurrency wallets.

An attempt to use the blockchain outside a closed digital environment. For example, it’s for registering real estate objects, monitoring the movement of goods. It raises the question of the legal significance of registration actions.

Fry Electronics Team

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