Blockchain technology, the infrastructure that supports the online crypto market still has a lot of potential to unpack.
2021 has kicked off to an action-packed start with cryptocurrency prices reaching record highs, sending digital markets into overdrive. According to crypto news, on Saturday 13th 2021, at 07:25 a.m. ET, the Bitcoin price reached a record high of $60, 415.34 according to San Francisco based digital currency exchange company Coinbase. Nothing seems to be stopping the digital currency which is up 963% over the last 12 months with a value surpassing $1 trillion for the second time this year.
Bitcoin and the many other digital currencies were developed using blockchain technology which uses distributed ledger technology that records information in a decentralized system. This technology facilitates a public ledger that cannot be manipulated and is accessible to all users. Blockchain ledgers provide a very secure mechanism for storing data as they cannot be modified retroactively and for privacy purposes, can be used anonymously.
One of the fundamental advantages of blockchain technology is the ability to cut out any intermediaries from the transaction. The fact that blockchain acts as a decentralized ledger for all transactions in a network means that individuals within these networks are responsible for confirming the transactions. This results in there being no need for a trusted third-party institution.
While blockchain has serious potential for high-powered applications in payment transactions, supply chain management and security, it is still a developing technology with a long journey ahead before it realizes such aspirations.
There are four main components on which blockchain is developed:
- Each participant in the network has concurrent access to view the data as it is stored within a distributed ledger.
- The integrity and security of the information is protected as a result of cryptographic safeguards.
- Adjustments can be confirmed directly between participants which replaces the need for an intermediary to authorize transactions.
- It incorporates smart contracts which allows automatic enforcement of the expected behavior of an asset or transaction embedded in the blockchain.
The above-mentioned conceptual designs create the opportunity to move away from traditional intermediaries. Additional benefits to blockchain technology includes increased security and transparency with a greater ability to track and manage transactions. The benefits will inevitably reduce costs and create additional security for companies that employ blockchain technology.
Blockchain and Real World Applications
The first to assume blockchain technology were of course organizations within the financial services industry with two specific areas of focus; the crypto market and infrastructure. The implementation of cryptocurrencies includes payment transactions, wallets and digital currency exchange.
Blockchain technology has the ability to provide solutions for infrastructure problems by replacing outdated systems and networks for trading and exchange transactions. This updated infrastructure could reduce costs, fraud and risk that is intrinsic to traditional transaction authentication and the management of ledgers and registries.
Blockchains can also remove repetition, source code management problems and communication delays which are all inherent in traditional banking systems as each transaction is only processed once in an individual shared electronic ledger.
Blockchain: Risks and Threats
While the future of blockchain technology looks bright, we must still remember that new technologies bring new risks and various complications that require working solutions. Blockchain is still a developing technology and therefore needs to be fully tested before it can be scaled for more extensive use in other industries.
Indeed, blockchain technology has its own, unique security measures. There are still however certain risk factors if the infrastructure, hardware and software systems around blockchain technology have significant weaknesses.
Substandard systems which have been improperly designed leave the blockchain exposed to cybercrimes and hacking. Privacy of information and risks associated with personal identity is still a notable concern. Users of public blockchains are generally identified with an alias and as transactions are encrypted, no private information is distributed. This anonymity has both positive and negative consequences; it protects users’ identities but also creates a safe haven for cybercrime and other criminal behavior to perpetuate.
Recovering Stolen Crypto
Cryptocurrency intelligence reporting has developed significantly over the last few years thanks to the rise in bitcoin scams and other cybercrimes. Several software programs and investigative techniques now have the ability to trace numerous types of cryptocurrency including Bitcoin, Ethereum, Ripple and Litecoin to name a few.
Victims of cyber fraud and crypto scams are typically unfamiliar with cryptosecurity and the prevalence of online crime and cybertheft. Blockchain analysis and digital currency investigation services provide victims with the information needed as a first step to recovering their funds.
Before recovery efforts begin, transaction IDs of transactions are required. These IDs allow investigators to track transactions and determine exactly where the digital coins are moving. Although it is possible to proceed with an investigation without these IDs, having a record will help advance the investigation and help minimize any possible complications.
With most blockchains, a transaction ID is the distinctive series of letters and numbers which represent a ledger of the movement of digital currencies from one address to the next. This is also commonly referred to as the transaction hash which specifies the date, time, sending and receiving addresses, transaction amounts and other critical information.
To provide further insight into the incident, supporting information and documentation will assist in the investigator’s understanding of the movements of the funds. Important information to include are all transaction IDs, where the crypto currency was sent from, where you believe cryptocurrencies were being sent and all available information on the scam and cybercriminals involved in the transaction.
The final step in your crypto recovery after dealing with a fake cryptocurrency exchange is to contact a well established and trusted investigation firm. MyChargeBack is an American fund recovery company which provides a number of services to assist individuals affected by cryptocurrency fraud. Recovery solutions include in depth investigation and analysis, assistance with providing evidence to law enforcement and filing a case and presenting evidence in court.
MyChargeBack provides free consultations. Chargeback and other fund recovery programs contracted thereafter are subject to retainers, fees and/or commissions depending on the individual case history and the type of service selected. MyChargeBack does not offer any financial investments or advice.