Blockchain 101 - Security, Privacy, and Smart Contracts
In previous chapters, I discussed the building blocks which make up the blockchain. In Chapter 3, Blockchain 101 - Assets, Transactions, and Hashes, I started with the smallest bits and bytes that flow through the blockchain, whereas in Chapter 4, Blockchain 101 - Blocks, Chains, and Consensus, I started by explaining that transactions are added to blocks, and I showed you a few different structures used by the current blockchain in the technology ecosphere. I continued the chapter by describing how blocks are formed and how they are chained together to create a blockchain. Within the lifespan of a blockchain, it is possible to have forks. I explained the concept of forks in general and what types of forks exist. I then concluded the chapter by telling you how consensus is reached regarding the trustworthiness of the data in the blockchain and what different methods the blockchain can use to reach it.
In this chapter, I will continue with the topics of security, privacy, and smart contracts, and I will try to make it absolutely clear that a blockchain is not just an ordinary, shared database. This chapter explains how safe blockchain is in reality and what it takes to keep the blockchain safe. Together, we look at the advantages and disadvantages of the blockchain as compared to other shared databases. Whereas security is one side of the story, I also will be touching base on the privacy aspects of the blockchain and how your privacy is not compromised. Finally, I will explain the added value of smart contracts when operating a blockchain, and how they can make automatic decisions based on programmable code.
In this chapter, you will learn about the following topics:
- How secure is the blockchain?
- What kinds of wallets are available to keep data safe?
- Do you have control over your privacy?
- What are smart contracts, and what is their added value?