4 ways that Blockchain Prevents Online Fraud and E-crime

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Blockchain

Blockchain has been heralded as one of the safest ways to store and access data. This was the main reason that blockchain was the structure upon which cryptocurrencies were formed and established. This article looks at the three top aspects of blockchain safety and security as a means to improve your understanding and allow you to know how safe you, your data, and your crypto really are.

The distributed network

The fact that the blockchain is shared with those who have permission or on a public blockchain means that transaction data is shared and then reconciled by the users on an ongoing basis. This leaves very little room for fraud and cybercrime. A shared ledger increases viability and transparency and ensures that all transactions are recorded and shared as they happen. There is a great explanation of this in relation to the crypto Cosmos at okx.com. Because you can also see the entire history of all transactions and note the change in asset bases, thus it is easier to spot a fraudulent transaction. 

Consensus based

All blockchains are based on user authentication to prove transactions. There is no centralized authority, and as such the peers in the peer-to-peer network will need to authenticate all the transactions that they have been party to or involved in. Each new block of information is added to the previous ones that it is related to – and as such there is a known history of all transactions, all of which have been authenticated by those in the peer-to-peer relationship.

Cryptography

All messages and transactions on the peer-to-peer network are encrypted. Thus only those who have the codes to de-crypt are able to access such information. Professional or high-level cryptography will prevent anyone for whom the information or data is not intended from opening and accessing such data. The idea of cryptography can be quite complex, but in layperson’s terms, the idea is to hide all transactions from those who do not have the key or codes to decrypt the information sent.

Most blockchain networks are permissioned

Whether you have access to a Cosmos blockchain hub or only use blockchain for your crypto, the networks are generally permissioned; even a public blockchain network will have permission sections. Not all public blockchain networks will be permissioned – and thus you need to be aware as to the type of blockchain network that you have set up and why you need it.

Blockchain is heralded as one of the safest ways to save, share and adjust data and information. The fact that we all accept that we live in the information age, the blockchain safety measures as discussed here will become ever more important. Security in the metaverse needs to be the best it can be. If we intend to live our lives in a virtual world, then we need to have the safety and security for all financial and risk laden transactions that we conduct in this virtual space.