Blockchain technology, while still in its early stages, has become a critical piece of technology for many businesses and operations. Immutability and distributed nature of blockchain have made this technology indispensable. However, blockchain is facing a challenge that no one had fathomed before and its strength is becoming its Achilles’ heel. Considering the current geopolitical impact of the Russian-Ukraine crisis, there are serious concerns about blockchain. We have already seen a worrisome example when at the end of 2021, Kazakhstan witnessed the loss of the internet that tanked the bitcoin prices. It showed us the vulnerability of these ledger technologies that can be brought to their knees if an entire nation the size of Russia, China or India disconnects itself from the internet and disrupts the contribution to the distributed networks.
“We need to be very careful about who is owning the nodes, especially when it comes to mining and verification in the distributed ledger tech,” says Dennis Zimmer, CTO of Codenotary on the latest episode of TFiR Insights. The show covered the dark side of blockchain technology which is becoming evident due to the ongoing geopolitical crisis. Zimmer debunks some of the misconceptions people have around DLT (distributed ledger technology) security and he discusses the importance of immutable data and how it may be used in the future. Zimmer adds, “The dangerous part is the more we advance into a system like this, the higher the risk of somebody breaking into this system or manipulating the whole system.”
Here are some of the topics we covered in this episode:
- Zimmer discusses how geopolitical issues can affect the stability of distributed ledger technology and highlight vulnerabilities. He explains what risks there are when who owns the nodes on the network is not known.
- Although cryptocurrencies are probably the most recognized blockchain technology, distributed ledger technologies are essentially about ownership that cannot be manipulated or controlled by a state or intermediate or another party. Zimmer explains the potential dangers of distributed ledger technologies as we advance further into these systems.
- We are sitting in an intermediate phase between regulated and unregulated with distributed ledger technologies, although Zimmer feels that eventually, government regulation in this area will be a positive thing. He explains further the main risks and benefits government interventions can pose that can affect distributed ledger technologies globally.
- Zimmer believes that people will trust more in DLT if it is regulated. He discusses the benefits regulation will have on DLT and some of the use cases that will benefit from the ability to validate and audit everything.
- It is important for organizations to understand the need for immutable data, which cannot be modified or deleted.
- Many people think just because distributed ledger technologies are spread across the world, they are safe. Zimmer discusses some of the misconceptions people have when it comes to DLT and the importance of validation and verification.
- Non-profit foundations such as Apache and Linux Foundation work on a global basis to create trust and there are already many ways how the validation is being done by associations. Zimmer discusses some of the issues that still exist with protection and security.
- Zimmer believes that those within the ecosystem are well aware of the risks associated with distributed ledger technologies; however, most people do not possess this deep understanding.
- Immutable data will likely be widely adopted in the future. Potential use cases where immutable data may be used are discussed in further detail.
About Dennis Zimmer: Dennis Zimmer has a strong reputation as a technology visionary across the Globe. He was founder and CEO of Opvizor Inc., a virtualization monitoring company. He’s been working for over 20 years in the IT industry, wrote 10 books and hundreds of magazine articles and video trainings, that are read and used by leading IT professionals. Dennis has been awarded the VMware vExpert recognition (only 30 worldwide) for 11 years in a row. He’s also a thought leader within the Virtualization Community.
About Codenotary: Codenotary brings easy to use trust and integrity into the software lifecycle by providing end-to-end cryptographically verifiable tracking and provenance for all artifacts, actions, and dependencies. Codenotary can be set up in minutes and is fully integratable with modern CI/CD platforms. It is the only immutable and client-verifiable solution available that is capable of processing millions of transactions a second.
The summary of the show is written by Emily Nicholls.