According to the Pentagon report, the blockchain is vulnerable. It says only 2 and 4 participants can disrupt BTC and ETH, respectively.
According to a new Pentagon report, blockchain technology might be lacking on a few fronts and is rife with several pressing vulnerabilities. The Pentagon’s research arm, Defense Advanced Research Projects Agency (DARPA), enlisted investigative research organization Trail of Bits to scrutinize the blockchain.
The Pentagon report alleges that blockchain is not decentralized, has outdated running software, and is vulnerable to attacks. The commissioned report, titled “Are Blockchains Decentralized, Unintended Centralities in Distributed Ledgers,” also states far-reaching implications for various sectors. According to the report, this is because a subset of individuals can “exert excessive and centralized control over the entire blockchain system”. Furthermore, potentially-affected sectors include the ever-evolving security, fintech, big tech, and the crypto industries.
The blockchain report focused extensively on the two leading digital currencies in the global crypto marketplace – Bitcoin (BTC) and Ethereum (ETH). According to Trail of Bits, it takes only four participating entities to disrupt BTC, and two to disrupt Ethereum.
The security research organization added that 60% of all BTC traffic moves through only three ISPs. Lastly, the report says that the blockchain is suffering a few security lapses. These lapses stem from the presence of outdated and unencrypted software and protocols. The report said:
“The safety of a blockchain depends on the security of the software and protocols of its off-chain governance or consensus mechanisms.”
Pentagon Blockchain Report Comes Amid Less-than-stellar Crypto Outlook
Interestingly, the Pentagon-commissioned blockchain report is coming only a few weeks after the Luna crypto crash. Back in May, the TerraUSD (UST) stablecoin plummeted to 30 cents after its blockchain algorithm collapsed. The crash caused investors to lose several billions of dollars almost irretrievably. Financial gurus called the event an important lesson on blockchain risks.
Amid the Luna crash, the global crypto marketplace has been in a perpetual tailspin. Because of the plunge, crypto investors are bleeding out a lot of money. Also, the fact that many crypto investors are now selling off their crypto assets is not slowing the slump. Furthermore, macro-economic factors precipitating the global price of crypto include supply chain problems and inflation. The presence of these global economic vices have sparked fresh talks of a looming recession.
Despite some of these setbacks, a growing number of organizations and industries continue to embrace blockchain technology. This is due to its product potential, seamless interoperability-friendliness, and capacity to provide unrivaled access to more financial breakthroughs. However, security also remains a central talking point in this new digital finance era, as elucidated by the Pentagon report. The US Department of Defense’s administrative facility concludes by saying:
next“We should not take any promise of security on face value and anyone using blockchains for matters of high importance must think through the associated vulnerabilities.”