6 Common Misconceptions About the Security of Blockchain Technology and Smart Contracts

As blockchain technology becomes an increasingly popular option for companies searching for secure business solutions, we’re seeing more use cases for the network and smart contracts.

A smart contract is a computer protocol that is used to digitally facilitate, verify and enforce the performance of credible transactions without the need for a third party. When operating on a blockchain network, smart contracts are utilized to verify or enforce a set of promises through various digital security methods.

However, there are a wide range of misconceptions about the security that blockchain and smart contracts offer. The average blockchain developer should be able to identify these widespread falsehoods and educate business leaders on the potential benefits of utilizing the blockchain for security purposes.

Blockchain Misconceptions

The Main Beneficiaries of Blockchain Technology Are Criminals

When blockchain technology first emerged into the mainstream, it was commonly portrayed as a hub of criminality, particularly on the dark web. Although the adoption of blockchain for secure business solutions has spread, there remains a negative connotation that it allows criminals to operate in full anonymity. On the contrary, most public blockchains are fully traceable and secure, as the technology enables businesses to track what is being sent between the company and clients.

Blockchain Is Unhackable and Unmodifiable

One misconception that is commonly spread about blockchain technology is that it’s completely unhackable and unmodifiable. Although the blockchain is one of the most secure options available to businesses, no system is 100 percent safe from being hacked or altered. In theory, any person or group within a blockchain network is capable of gathering enough mining resources to take control, though it is highly unlikely. The only assurance that blockchain technology can provide is that it will detect any unauthorized changes made to the records of applications on the network.

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