In the domain of product development, creators and product owners are tasked with the necessity to build applications with greater data security and privacy. To meet this evolving need, leaders have started investing in Blockchain-powered app development. Originally derived from Bitcoin, Blockchain technology has evolved over the past years to cover various use cases beyond digital currency. Although Blockchain app development is not without its concerns, in recent times, more security breach instances have been reported related to Blockchain solutions, resulting in billions of losses.
These incidents included convolutional attacks like phishing and network breaches and new threats explicit to the Blockchain ecosystem, like cryptojacking, 51% attacks, and rug pulls. Hence, product owners must understand that like any development project, Blockchain-based app development requires leveraging best security practices to maximize the potential.
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Key Purposes of Investing in Blockchain App Development
Many product leaders opted for Blockchain application development to instantly scale up and out their solutions and deliver more sophisticated financial and business models. At present, around 8985 active cryptocurrency systems are running in the Blockchain technology. However, it turns out that Blockchain technology is also a reliable means of recording digital transactional data and documents. Product owners adopt this technology for app development because they expect it to deliver the following:
- Distributed Cloud Storage – Blockchain integration in mobile apps enables enterprises to serve their app users faster with secure and distributed Cloud storage. This saves the pain of handling user permissions, setting up third-party storage, and configuring user validation. For the same, product creators would have to opt for a trustworthy BaaS provider.
- Digital Identification Process – Many of the conventional identity management systems possess downsides in terms of data breaches and user experience. On the contrary, Blockchain-based digital identity management empowers app users to generate, control, fully own, and organize their individualities. Other benefits include enhanced data privacy, faster authentication processes, and reduced verification costs.
- Data Organization – Blockchain provides a robust data systemization mechanism that allows data in enterprise apps to be stored across multiple chains and retrieved securely. The customizable Blockchain architecture enhances security against potential threats.
- Infrastructure Protection – By leveraging the Blockchain DNS (Domain Name System), product creators can effectively overcome Distributed Denial of Service (DDoS) attacks on app infrastructure. Since there is no central point of failure, it’s difficult for hackers to disrupt the app by targeting nodes. Likewise, a Blockchain DNS eliminates illegal censorship efforts.
By the end of 2024, the worldwide Blockchain development market is expected to be worth $20 billion. Leaders across the healthcare, finance, and retail sectors aim to increase their investment in the development of Blockchain apps and future-proof their operations.
Elements that Influence Blockchain App Security
Blockchain and its functionality are easier to comprehend, but ensuring security in Blockchain applications is a different domain. To ensure security and protect Blockchain apps from unauthorized hacks and attacks, it is essential to follow best practices and techniques. However, before diving into the practices, let’s look at some of the key elements that impact and govern Blockchain app security level:
- Cryptography – This uses mathematical techniques to encrypt application data, guaranteeing its integrity, confidentiality, and legitimacy.
- Consensus – An agreement between the order of transactions and nodes on the validity. This helps in eliminating Eclipse attacks and double-spending. Consensus mechanisms like Proof of Stake and Proof of Work are standardly used in the domain of Blockchain development.
- Decentralization – The decentralization of power and control among numerous nodes minimizes the risk of single points of failure or breakdown in applications. Blockchain has taken delegation to the next level by decentralizing the work among thousands of universal nodes.
- Smart Contracts – The autonomous executing contracts that determine and enforce the logic and rules of transactions eliminate the need for mediators or third parties. Once set up, these contracts cannot be modified, and the transactions will abide by the terms programmed without any compromises.
Also read – How Blockchain App Development is Paving the Way for the Future
4 Fail-Safe Practices for Strengthening Security in Blockchain Applications
Encryption Techniques for Improved Data Security
In the context of Blockchain app development, applying encryption techniques is vital to protect user transaction information and privacy and ensure data consistency. It also plays a crucial role in maintaining the security and integrity of the Blockchain network. Implementing robust encryption in Blockchain apps is possible through public key cryptography, hash functions, and digital signatures.
Public key cryptography, commonly known as lopsided cryptography, is a predominantly used encryption technique in Blockchain development. This technique simplifies app encryption by giving access to two keys: a public key and a private key. The public key encrypts data, making it indecipherable to unauthorized app participants. With the private key, product owners will be able to decrypt the encrypted data, guaranteeing secure storage and transmission of app transactions.
Delegating digital signatures to every app participant helps in easy authorization and maintaining the integrity of Blockchain transactions. A unique signature is generated for each exchange using public key cryptography depending on the sender’s private key and message content. As an alternative, using the Hash function enables product owners to transform any string of data into a compact format that is perfect for future analysis. Developers from a recognized Blockchain app development services provider can guide product creators with Hash Function and facilitate quick storage and retrieval of application data.
Securing Blockchain Networks
Blockchain networks encounter security threats that could compromise their performance and functionality. Hence, the implementation of robust measures to secure Blockchain networks helps in averting financial losses. One of the measures for safeguarding Blockchain networks is imposing network consensus protocols. Product owners need to determine the rules and algorithms in advance like how to govern nodes and where to record transaction data. This way, administrators will be able to prevent malicious nodes from generating forks or tampering with transactions.
Despite applying consensus protocols, there are scenarios where hackers mess with Blockchain applications by sending fake requests or traffic to the network. This slows down, disrupts the network, and impacts business reputation. That’s why product creators need to integrate transit capacity servers with Blockchain apps to capture and mitigate fake requests. Additionally, these servers use load balancers to constantly monitor and transfer loads between networks to prevent abnormal traffic.
Strengthening Smart Contracts
Security must be a topmost priority for product creators when designing and building a Smart Contract. When a Smart Contract is deployed, it is tough to upgrade or patch; it must be detached, reprogrammed, and redeployed. Additionally, vulnerabilities in a Smart Contract will impact every Blockchain app user. Some of the common vulnerabilities and solutions to consider:
- Reentrancy – This vulnerability happens when the Smart Contract’s code logic is flawed. App creators need to meticulously design external calls and always monitor and upgrade the contract’s state, such as lessening the gas fee before granting requests to send funds. Incorporating a reentrancy guard module prevents contracts from executing more than one function at a time, thereby regulating the process.
- Oracle Manipulation – Smart Contracts access and consume peripheral data from outside the Blockchain through Oracle. Manipulated or incorrect Oracle data can disrupt the execution of Smart Contracts. With a decentralized oracle, such as Tellor or Chainlink, app creators can ensure a contract obtains accurate data. Such oracles make it harder for hackers to meddle with the data.
To ensure the overall quality and security of Smart Contracts, it is also essential to perform continual auditing and testing before deployment. Auditing helps in identifying and resolving any errors, bugs, or vulnerabilities. Testing is validating the functionality and ability of intelligent contracts under real-time scenarios and user inputs. Auditing and testing can be done with the help of skilled professionals from a Blockchain app development company. Either manually or automatically, the professionals conduct rigorous testing and deploy glitch-free contracts.
Imposing Access Controls
Access control is a pivotal element of Blockchain application security. This determines who can access confidential app data and resources and in what conditions. Access control covers user authentication and authorization. User authentication confirms that a user is who they assert to be, through credentials, while user authorization provides or denies accessibility to a user.
When it comes to standardizing access controls, there are different ways to do it. To restrict access based on the identity of a user, product owners should consider using Discretionary Access Control (DAC). Attribute-based access control (ABAC) is an authorization method that assesses attributes (past or recent transaction history), instead of roles, to provide access. RBAC is another common model that app owners use to determine access and permissions based on the user’s roles and rank in the network.
For authentication, implementing the two-factor authentication (2FA) model is the right choice. 2FA prevents illicit access to wallets integrated into Blockchain apps even when hackers obtain credentials, as they will need a 2FA code. The code varies with each login attempt and is received through a hardware authentication device or mobile device. Implementing 2FA acts as an incredible deterrent against online vulnerabilities, safeguarding the wallet.
Closing Thoughts
The importance of Blockchain app security should be addressed at any cost by product creators, as it can result in hacking attacks and vulnerabilities in the long term. Blockchain app development is a highly lucrative investment, but only for product leaders who understand and follow the security best practices. When developed correctly, Blockchain solutions can deliver exceptional operational efficiency, security, and reduced costs.
