Op-ed by Professor Kelvin Low on why Bitcoin users should not overlook cryptocurrency’s fundamental flaw

Following the latest meltdown in the crypto markets, it is timely to explore the blockchain’s fundamental flaw. When the blockchain is described as a secure, decentralised ledger, it is important to note that the security is concerned exclusively with ex-post-ledger edits because the community is obsessed with double-spending, which is a far more nuanced “problem” than the community thinks. The problem with this obsession is that most fraudsters target end-users and not the ledger itself. This means that blockchain security is akin to the infamous Maginot Line built by France to deter invasion by Germany before World War II, except that it would be pointed in the wrong direction at Dover. Even worse, because blockchains are immutable, the way in which we would normally address such frauds by reversing the fraudulent transfer is rendered highly impractical, which explains the regular hacks we see for what is advertised as secure.

Cryptocurrency enthusiasts dismiss the significance of these security breaches by preaching a libertarian creed. But no legal system on Earth, going back several centuries, has ever adopted a libertarian view of how losses should be allocated and ownership established, making it difficult to see how blockchains can work as authoritative records of ownership.

Read the full article by Professor Kelvin Low here.