Bring up the topic of blockchains and it won’t be long before the word “immutable” is dropped into the conversation. After all, a blockchain’s inability to be tampered with or modified is one of its biggest selling points. But, is it actually as immutable as they say it is? Once a transaction is recorded on a blockchain, does that mean it’s carved in stone?
“Yes”, “no”, and “sort of” seem to be the resounding responses. So why can’t people agree on blockchain technology’s most marketed feature?
“Firstly,” says TEDx speaker and founder of Mycryptopedia Bisade Asolo, “it would be useful if we first define the term immutable. Immutability can be defined as something that is unchangeable. When we apply this definition to the context of blockchain technology, immutability refers to the unalterable nature of all data that is included in a blockchain. For example, once a transaction and all its corresponding data has been recorded on a blockchain, it can no longer be changed.”
And since each blockchain is created by consensus between the chain’s participants, once a transaction has been subjected to sufficient validation checks, cryptography makes sure that it can never be reversed or tampered with – unlike ordinary databases that can be modified an unlimited number of times.
So, is a blockchain immutable, then? Yes. But there’s a caveat. A couple, actually.
A 51% Attack
“Despite often providing institutional-level security, blockchain networks, just like any other technology, are still at risk of being compromised, says EverMarkets CTO and co-founder Craig Austin. The consensus mechanism of a blockchain can in fact be overpowered and its history altered in something known as a 51% attack.
In a 51% attack, blockchains would lose their ability to be immutable, as a bad actor (we’re not talking about Adam Sandler or Arnold Schwarzenegger here) could mine enough blocks to possess more than 50% of a network’s mining hash rate. This would give them the consensus, and they could do pretty much as they pleased with the world of data within – from altering blocks to completely eradicating transactions.
The chance of this happening, however, is “very unlikely,” says Cal Cook, Consumer Finance Investigator at Consumersafety.org, “because there would be no economic incentive to do so. A malicious user who overpowers a public blockchain network would, in doing so, devalue the currency, so even if they “stole” some coins they would very likely end up with less money in terms of fiat dollars than they had before.”
Forking is another powerful way to rewrite history and challenge blockchains’ immutability. In fact, it’s already been done. “The best example of this,” says Alan Majer, CEO of Good Robot, “is when Ethereum hard forked its entire chain to rewrite history after the DAO ‘hack.’ The fork would keep the rest of the blockchain history intact but rewrite a single ‘tiny’ historical fact: it would take back the attacker’s funds and put them into a refund account, effectively making it look as if the attack on the DAO never even happened.”
Not everyone was in agreement with the practice of forking to rewrite a wrong, even if it did keep Ethereum afloat. Creating discord among purists who did not believe that history should be rewritten, a small minority continued to use the same chain and Ethereum Classic emerged, trading at a fraction of Ethereum’s price today. However, says Majer, “a hard fork (that people agree on) is one of the best ways to rewrite the ‘immutable’ transactions in a blockchain.”
“Blockchain technology is basically a form of cryptography – it’s nothing but mathematics that is robust and proven. But the problem is not in the math; it’s us, humans,” says Evgeny Chereshnev, CEO and founder of Biolink.Tech. “Technology provides us with an unprecedented and truly decentralized consensus tool that in theory makes all commissions and exchange fees obsolete. But it turns out we are not ready… we just don’t know what to do with this freedom, so we go back to good old medieval mechanisms of supervised trade: cryptocurrency exchange [platforms] take commission fees and transaction fees that are not required by the network.” And these secondary platforms are ripe for MITM (man-in-the-middle) attacks.
So Blockchains aren’t Immutable at All, Then?
Um, well, not really. But you might want to consider this analogy. Pigs can’t fly. This is an absolute truth that we all know and agree on. “But,” says Loudon Owen, chair and CEO of DLT Labs, “given a phenomenally strong wind, pigs can fly.” He continues, “Nothing digital – including blockchain – is entirely immutable. But blockchain is a massive, distributed digital ledger which is as good as it gets for electronic storage.”