Blockchain revolution: Utilizing technology in security and fraud detection

Blockchain revolution: Utilizing technology in security and fraud detection

By Olga V. Mack, VP, Strategy, Quantstamp

Meet Olga at X-Tech 2019: Financial Services and Technology  (Get 15% discount on the Convention using presenter code: XTECH33)

Olga, can you please tell the Risk Insights readers a little bit about yourself and what your current professional focus is?
I love the intersection of blockchain strategy, leadership, and innovation. I serve as Vice President of Strategy at Quantstamp, the first decentralized security auditing blockchain platform. We build security tools for blockchain applications, provide security audits for smart contracts and secure innovation services for enterprise companies.
What, for you, are the benefits of attending a conference like the ‘X-Tech 2019 Convention’? What can attendees expect to learn from your session?
I will discuss a framework that helps enterprise innovate securely in blockchain and blockchain applications. Blockchain is not a magic potion – it won’t solve all the problems in your company. Most of us have heard the saying, “to a man who only has a hammer, everything he encounters begins to look like a nail.”  I encourage companies to avoid falling into a trap of thinking blockchain is the answer to everything.
In your opinion, do you think blockchain will compromise data?
Blockchain applications are vulnerable. Because blockchain applications such as smart contracts hold millions of dollars of assets, they’re high-value targets, almost like digital lottery tickets. They most definitely attract sophisticated criminals.

New exploits are actually very common, with new ones being born every day. If you do anything with blockchain applications, you should definitely be concerned about security.

Security vulnerabilities give blockchain application such as smart contracts a bad rep. The vulnerabilities in smart contract code have slowed down its adoption. In order to achieve mainstream adoption, security issues are something we need to tackle.

Why is it so important to innovate in blockchain and how can this be done in best practice?

We are early. It’s always a best practice to conduct small, low risks experiments in order to understand the full potential of blockchain as it applies to your business. You are not doing it to create immediate ROI and products. You’re doing it so your business doesn’t become obsolete. So, pilots are key. Explore, hypothesize, make mistakes, learn, repeat. Of course, when successful, then scale.

Why is blockchain valuable from the security point of view?

The reason the blockchain is so valuable in the first place is because it provides security to the underlying data. At its core, the blockchain provides us with a tamperproof database that enables all current and future use cases of this technology.

The blockchain ensures that this data is tamper proof by maintaining several copies of the database simultaneously. If a hacker or a bad actor manages to modify one of the databases, all the other copies will become aware of this tampering through cryptography. The tampered database can then recover the correct data from other copies…math magic in action.

Looking ahead, how do you see blockchain benefitting the financial industry further?

Blockchain and its applications, such as smart contracts, have a lot of potential. They can create efficiencies and solve problems that we haven’t been able to solve before with any other technology. I am convinced that blockchain and its applications may benefit numerous businesses and may lead to substantial competitive advantages. Given that we are in the very beginning of this industry, I’m confident that there are multiple opportunities across all industries, especially finance.

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