Let me explain why hacking the Bitcoin blockchain is nearly impossible.
You may have seen several news stories detailing how hackers stole millions of dollars in Bitcoin. These cryptocurrency heists, however, never mention the Bitcoin network being hacked. Bitcoin makes use of blockchain technology and cryptographic techniques to ensure the network's security. Since its inception, the Bitcoin network has proven to be a resilient technology that can withstand a wide range of failures and hacks.
• Is it possible to compromise Bitcoin?
• Is it possible to shut down the Bitcoin network?
Is it possible to compromise Bitcoin?
When we talk about Bitcoin hacking, several things come to mind. Individual addresses, the blockchain network, and wallets are all used to store Bitcoin.
Let's take a look at the three ways a malicious actor can or cannot compromise Bitcoin or its network.
• Individual address hacking
• Hacking the Bitcoin network, also known as a 51% attack;
• Hacking Bitcoin wallets
1) Hacking individual addresses
If your Bitcoin private keys fall into the wrong hands, they become vulnerable.
Long alphanumeric strings serve as public and private keys. Finding the keys by guesswork and mathematical calculations is not only time-consuming but also costly.
Using the brute-force attack technique, a malicious actor can gain access to Bitcoins by guessing the public and private keys. This method entails attempting to guess every possible combination of numbers and alphabets.
However, guessing the keys is extremely difficult due to the possibility of nearly 2256 or 1077 private keys. That is an enormous number of possible outcomes. To put things into perspective, the total number of grains in the world's sands is estimated to be 1020. Consider how difficult it would be to guess the private keys.
According to the analysis, hacking an individual Bitcoin address is nearly impossible.
2) Bitcoin network hacking (or) 51% attack
Because of its underlying technology, the Bitcoin network is notoriously difficult to hack. All Bitcoin transactions are recorded and registered using blockchain technology. It generates a searchable database of all transactions in one location.
Because blockchain is decentralized, information is not stored on a single server. The transactional data is spread across a vast network of computers, which constantly verify the data's validity, making hacking the Bitcoin network more difficult.
Assume you want to access data stored in a single room that is guarded by a security guard. It may be difficult, but you only need to get past the one security guard who guards the locked door.
Assume that the entire information is spread across 100 rooms, each of which is guarded by a different security personnel. This means you'll have to go around 51 guards to get the information you need. Sounds much more difficult, doesn't it? The Bitcoin network is in the same boat.
It is nearly impossible to compromise the Bitcoin network unless you have 51% of the network's computing power. This is referred to as a 51% attack. It is not only a difficult but also a costly process.
Bitcoin's primary security feature is that it consumes a lot of energy. To authorize the data, a malicious actor must gather the majority of the network's total computing power. This 51% attack is both impossible and prohibitively expensive. As a result, the network cannot be hacked.
3) Hacking Bitcoin wallet
The majority of incidents reported in the news involve hackers gaining access to a user's Bitcoin via wallets. There are several ways for a bad actor to gain access to your Bitcoin wallet, ranging from storing coins on an unsecured exchange to leaving your laptop unprotected.
Any exchange that stores Bitcoins or other cryptocurrencies in hot wallets is vulnerable to hacking. Simultaneously, secure cryptocurrency exchanges keep users' cryptocurrency funds in cold wallets, where no third party can access them.
It is important to note, however, that all previous hacking incidents have involved Bitcoin wallets and never the Bitcoin network.
Is it possible to shut down the Bitcoin network?
Can the Bitcoin network ever be shut down if it is not compromised? No, not at all, and here's why.
The Bitcoin network has been running for over a decade, with millions of nodes spread across the globe. Because of one of its distinguishing features, decentralization, no central entity or government can shut it down.
Bitcoin trading may be difficult in some parts of the world, but no one can truly stop it. Fighting Bitcoin is akin to refusing to use the internet. People can withdraw from Bitcoin, but they cannot shut down the entire network.
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