Some people say, blockchain technology ensures the safer way of transaction and may, at last, replace the current bank systems. Their opinions are based on the idea that, blockchain assigns transactions or smart contracts to an immutable ledger, verifiable by multiple parties.

However, recently, several Chinese students published a paper calling out some vulnerabilities that may subject blockchain entries to inefficiencies, hacking and other criminal activity. I'm worried that the immature blockchain technology will negatively influence my invest in bitcoin. Undecided

The key known risk factors are listed below:

-Blockchain efficiency: For starters, the efficiency of blockchains themselves may become overloaded with complex consensus mechanisms and invalid data. Most popular consensus mechanism used in blockchain is Proof of Work, which the researchers call a "waste of computing resources. In addition, blockchains will produce a lot of data -- block information, transaction data, contract bytecode -- that may be outdated and useless. Thus, An efficient data cleanup and detection mechanism is desired to improve the execution efficiency of blockchain systems.

-Private key security: The user's private key is regarded as the identity and security credential when using blockchain. Its generated and maintained by the user instead of third-party agencies. An attacker could "recover the user's private key because it does not generate enough randomness during the signature process. Since the blockchain is not dependent on any centralized third-party trusted institutions, if the user's private key is stolen, it is difficult to track the criminal's behaviors and recover the modified blockchain information.

- Frequent criminal activities with Bitcoin include ransomware, underground markets and money laundering. Through some third-party trading platforms that support Bitcoin, users can buy or sell any product.Since this process is anonymous, it is hard to track user behaviors, let alone subject to legal sanctions.

-Transaction privacy leakage: Unfortunately, the privacy protection measures in blockchain are not very robust. Criminal smart contracts can facilitate the leakage of confidential information, theft of cryptographic keys, and various real-world crimes (e.g.,murder, arson, terrorism, etc.)

These are all important factors which should be included when considering to join the blockchain and cryptocurrency investment. ( the full 9 risk factors can be seen in FuninUSA)

The technology of blockchain is still very immature at this moment. I wonder, if these problems could finally be solved. Will bitcoin gradually accepted by the majority of people and be used as a method of payment? Also, once the blockchain technology is mature enough, will the bitcoin disappear? Hoping to hear your idea! Wink

[ps:students are Xiaoqi Li, Peng Jiang and Xiapu Luo (all with Hong Kong Polytechnic University), Ting Chen (University of Electronic Science and Technology of China), and Qiaoyan Wen (Beijing University)]

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