Blockchain Security and Threat Modeling
A powerful secure-by-design system architecture
What Is Blockchain?
Blockchain technology is a distributed digital ledger for recording and verifying transactions without the need for a central authority. Blockchain derives its name from how it works: Transaction data is organized into blocks, then linked together into a chain that serves as a chronological record of those transactions.
Blockchain operates on a peer-to-peer network where every participant (or node) has a copy of the entire blockchain. Because every transaction is visible to each node on the blockchain, there is no need for a central authority to validate transactions. This principle of decentralization ensures there is no single point of failure within the blockchain, making the system highly resilient. This principle also ensures that the information stored in the blockchain is transparent and effectively immutable, as any attempt to alter a block would require changing all subsequent blocks across the entire network.
In addition, before any transaction is added to the chain, there must be consensus among the nodes in the network that the block to be added is valid. This feature, along with using cryptography to link blocks together, makes altering or tampering with confirmed data extremely difficult. The combination of decentralization, consensus, and cryptography forms a powerful secure-by-design system architecture that fosters accountability and trust among its users, each able to independently verify the integrity of any information on the blockchain.
Why Blockchain Security Is Important
Blockchain was designed to ensure trust and accuracy in transactions. and the technology has many real-world applications, including finance, supply-chain management, healthcare, and real estate, and modern applications such as smart contracts, decentralized finance (DeFi), and election security. As blockchain technology matures and proliferates to more sectors, it may become part of many public and private IT infrastructures, making blockchain security even more important.
Blockchain data may represent real or virtual assets and confidential information. While transaction blockchain data is public, user information is often private. Given that trust and collective accountability are crucial to the blockchain operating model, security is a paramount concern for not only safeguarding sensitive information and assets but also for preserving the integrity of the network itself.
What Are Common Security Challenges for Blockchain?
Despite the intrinsic security of the blockchain model, its design and technology can be at risk of cyberattacks, malicious actors, and human error. The consensus mechanism for validating transactions is a particular concern if exploited, as any entity that controls more than half of a network’s total compute power or stake can manipulate the blockchain’s records, functionality and integrity. Other common threat factors are user identities, coding errors, and network infrastructure.
The most common attacks:
- 51% attacks: These attacks occur when malicious actors control more than 50% of a network’s resources (including mining power in the case of cryptocurrencies). With this majority control, attackers can manipulate transactions, deny new ones, and double-spend coins, presenting an existential risk to the network’s integrity.
- Blockchain forks: Changes to or weak spots in a blockchain’s operating protocol can result in a fork, which causes the blockchain to diverge into multiple chains with differing transaction histories.
- Smart contract exploits: Smart contracts are self-executing code stored on blockchain technologies. Malicious actors can exploit any bugs, coding errors, or other vulnerabilities in these contracts to steal funds, change contract terms or logic, or access sensitive data.
- Sybil attacks: These attacks entail creating multiple fake identities or nodes on the network, leading to manipulation of consensus mechanisms and disruption of network operations.
- Phishing attacks and social engineering: As in other technology ecosystems, phishing targets a network’s users rather than the underlying infrastructure. When phishing fraudsters trick users into sharing credentials or sensitive information, they can steal private keys, empty digital wallets, and sell private information to other cybercriminals.
- Routing attacks: Because blockchain is a digital network, connectivity is essential. In addition to disrupting normal operations, routing attacks can intercept sensitive data and subvert the legitimate technique of blockchain partitioning to enable double spending or consensus manipulation.
- Endpoint weaknesses: The touchpoints where network users interact with blockchain technologies are open to fraudulent activities, such as covertly observing user behavior and targeting devices to steal private keys and compromise digital wallets.
In blockchain security, threat modeling tools and practices are invaluable for detecting and countering these threats.
Threat Modeling in Blockchain Security
Effective threat modeling fulfills a pivotal need in blockchain security by playing the role of a malicious actor, probing blockchain systems, components, and processes for weaknesses. In this way, threat modeling identifies, assesses, and mitigates potential threats and attack vectors early in the development process, which forestalls costly rework and production delays. By reinforcing blockchain’s already robust built-in security with proactive threat modeling, developers can build even more protected and resilient systems that can more effectively safeguard users and network integrity.
Threat modeling enhances blockchain security through the following:
- Comprehensive risk assessments: Threat modeling methodically analyzes each component of a blockchain ecosystem—from network architecture to consensus mechanisms to user interfaces—to identify vulnerabilities that may be overlooked by inspections of individual components.
- Threat prioritization: Threat modeling frameworks such as Visual, Agile, Simple Threat Modeling (VAST) help security teams evaluate risks based on likelihood and potential impact, which allows those teams to focus on the most acute threats first. VAST builds on other threat modeling frameworks to provide an enterprise-level view of threats to individual system components and the entire system.
- Proactive threat mitigation strategies: By identifying potential weaknesses before attacks or failures occur, threat modeling enables forward-looking measures such as revising consensus mechanisms, initiating smart contract auditing processes, and improving user security education programs.
- Integration throughout the development lifecycle: When threat modeling is incorporated into the software development lifecycle, security becomes an essential piece of blockchain development rather than an afterthought. The usual benefits of integrated threat modeling apply—early detection of vulnerabilities, reduced rework and delays, and greater resilience.
- Continuous improvement: As new threats emerge or a blockchain ecosystem evolves, threat modeling can incorporate these changes to enable ongoing security enhancements and implement secure-by-design methodologies.
However, traditional threat modeling often falls victim to conflicting priorities between security teams, prioritizing an organization’s security posture, and development teams, tasked with delivering applications quickly and with minimal technical debt. Given the significant benefits of integrating threat modeling into blockchain security, selecting a vendor that can balance the needs and enable the goals of both teams is crucial.
Choosing the Right Threat Modeling Solution
Effective threat modeling is essential for keeping blockchain networks ahead of emerging and evolving threats and security challenges. However, conventional threat modeling solutions often lack the functionality and scalability to support modern blockchain environments. Many processes are also complex and manual, requiring significant effort from security architects to keep up with the pace of development. In these environments, threat modeling is not scalable, which means critical applications may be left unprotected against known and unexpected risks.
A modern threat modeling solution solves the scalability problem with intelligent automation, which flattens the learning curve associated with legacy solutions. By improving ease of use and accelerating time to value, integrating threat modeling into development workflows becomes feasible, enabling secure-by-design practices and reducing costly rework and delays.
Recommendations for evaluating threat modeling vendors:
- Expertise: Familiarity with threat modeling methodologies and development workflows
- Functionality: AI-powered capabilities to help detect and mitigate application risks
- Integration capabilities: Seamless integration with existing tools and processes
- Scalability: Automation capabilities and support for both on-premises and cloud environments
- User experience: Intuitive, user-friendly interfaces that minimize manual effort
ThreatModeler | A Scalable Enterprise Threat Modeling Platform
ThreatModeler provides comprehensive threat modeling to incorporate secure-by-design principles at every stage of the software development lifecycle. By analyzing new and existing systems and infrastructure architectures against known threats, organizations gain a complete view of internal and external attack surfaces—including entry points, software vulnerabilities, and potential attack vectors—without any threat modeling expertise required.
The result is faster, nondisruptive identification and remediation of risks—from core to cloud to edge.