A review of the book Bitcoin and Blockchain Security by Ghassan Karame and Eli Androulaki, along with an examination of common blockchain security issues.
Bitcoin and Blockchain Security: Book Review
At the same time as the popularity of Bitcoin and cryptocurrency, in general, is rising, its foundational blockchain technology is also being used in different sectors, with an increasing frequency. Real estate, healthcare, banking, and other industries have seen useful innovation thanks to blockchain tech. With this increase in popularity and reach, maintaining a high level of security is becoming even more critical.
Ghassan Karame and Elli Androulaki, authors of the book Bitcoin and Blockchain Security, would certainly agree. While the book was published by Artech House in 2016, the information contained within is still relevant today, which is why we’ve prepared this book review. It’s reading time!
Bitcoin and Blockchain Security Review
The Expert Authors
Even before you open the book itself, the authors’ credentials inspire optimism as to the quality of the book.
Ghassan Karame holds a PhD in Computer Science from the Institute of Information Security of ETH Zurich in Switzerland, and is currently a full professor of Computer Science at the Ruhr-University Bochum.
His colleague, Elli Androulaki, has a PhD in Computer Science from Columbia University, and works as a research staff member at the IBM Research Lab, also in Zurich.
Depth and Breadth of Information
With such qualifications, it isn’t surprising that Karame and Androulaki’s book seems to be primarily written for an academic audience.
Of course, you don’t have to hold a PhD to understand its content, but there are a lot of in-depth technical details that demand a reader who is well-versed in blockchain tech. If you’re only a beginner in the world of blockchain, it’s probably best to leave this book for a time when your understanding of blockchain has deepened.
Readers with an intermediary level of blockchain understanding will perhaps need to read through portions of the book several times. However, once they’re done reading, they will be acquainted with a wealth of precise technical information pertaining to blockchain and specifically Bitcoin security.
The Dark Side of Blockchain
Apart from that, portions of the book can be interesting because of the darker aspect of the blockchain story.
Namely, the authors also discuss ways that digital currencies can allow criminals to trade illegal goods, and even people, anonymously. One of the key benefits of blockchain is that the data regarding transactions is transparently available for everyone to see. However, the involved parties themselves remain anonymous.
Bitcoin and Blockchain Security is revealing in this sense, as it contains information on everything that the “good guys”, who are looking to put an end to this kind of illegal activity, have learned up until 2016.
For more recent data, readers will have to find another book, but we’re still of the opinion that Bitcoin and Blockchain Security is worth reading for this aspect as well, and not just for the technical info. The data regarding illegal operations seems to be well-researched, comprehensive, and rather interesting as it reveals the face of blockchain and crypto that’s not as well-known among average users.
Of course, if you regularly follow websites such as TradeCrypto, you’re likely aware of the criminal activities, such as money laundering on the world’s biggest crypto exchange Binance, but this stuff is alarmingly darker.
The Most Dangerous Blockchain Security Issues
It’s worth it to now talk a bit about some of the largest threats that blockchains are faced with. While blockchain networks do offer a very high degree of security, there are some security drawbacks that sufficiently skilled attackers can exploit.
The book Bitcoin and Blockchain Security, of course, contains a lot more information, but we’ve summarized some of it in this section of the article.
- 51% Attacks
One of the most dangerous events that any public blockchain network dreads is a 51% attack. If someone collects more than 50% of the network’s overall hash rates, this individual (or, perhaps, a hacker organization) will gain control over the entire network. He or she can, for instance, change the transaction order or reverse the already completed transactions.
This can be prevented by ensuring a high hash rate, by improving the monitoring of the mining pool, and by avoiding the PoW (proof-of-stake) consensus mechanism.
2) Phishing Attacks
Phishing attacks are becoming a common occurrence. With such an attack, the user is presented with ingenuine e-mails or webpages, requiring the user to enter his or her login credentials. Once in the hands of the hackers, such lost credentials can not only be damaging to the user, but to the blockchain platform as well
The users themselves will need to apply protective measures. It’s advisable to install a verified browser add-on that will alert you if a website is unsafe, and a solid anti-virus. Think twice before clicking on any suspicious links and avoid using open Wi-Fi networks when you’re conducting operations that involve your electronic wallet (or any banking transactions, for that matter).
3) Trading Bot Scams
Trading bots, made to automatize the trading process on cryptocurrency exchanges, are often just poorly put-together software that was developed for the sole purpose of making some quick cash for its creators. With a 1k daily profit scam, the impossible is promised, but many buyers are still naive enough to fall for it.
Don’t be one of those buyers. Before acquiring a trading bot, read the reviews on an expert trading bot scam detector like a Scammerwatch, and look for common red flags, such as claims that a trading bot is fully, 100% automated, or promises of unrealistic returns.
4) Routing Attacks
On blockchain networks, there is a constant movement of a huge amount of data. Attackers can leverage an account’s anonymity in order to safely intercept that data, as it is transmitted to internet providers. This is called a routing attack. You likely won’t even be aware that a routing attack took place, as operations and data transmission will proceed as usual.
Routing attacks can be prevented by using powerful data encryption, implementing secure and certified routing protocols, and advising users to both come up with strong passwords and change them often.
“This book provides a comprehensive look into the clandestine realm of bitcoin and blockchain. Written for those with an academic background, it is deep in technicality yet concisely explains the complexity associated with digital currency markets. Such currencies provide individuals living under oppressive regimes to part-take freely without fear of being discovered or having their assets seized by any single governing body; as well as enable nefarious activities such as illegal drug diplomacy and human trafficking that ironically thrive on anonymity assured through reliable security provided by decentralized networks using blockchains technology – the ultimate guarantor against tampering or fraud. This book is an unflinching look into a murky world, as well as the subversive actors who manipulate it. It offers comprehensive insights and covers all aspects of alternative coins – invaluable knowledge for modern-day investors.” – said Brandon S. Dixon one of the readers of Financialreviewofbooks.
All in all, Bitcoin and Blockchain Security is a highly informative book, containing data collected and interpreted by experts. It casts light on many blockchain security threats, such as the ones we’ve mentioned, and examines some of the lesser-known blockchain aspects.
It’s certainly not easy to read, but that’s secondary in comparison to its, ultimately, illuminating and at times fascinating content. A must-read for people interested in high-level blockchain security.