Blockchains bring trust and security to digital transactions. Security plays a major role in this. Deutsche Telekom supports more than 10 public blockchain networks with their own infrastructure. Now another one is being added with Aleph Zero. Dirk Röder, who’s responsible for the Web3 infrastructure & solutions team at Deutsche Telekom MMS, explains the company's strategy for secure blockchains and how his blockchain of the future looks like.
How secure are blockchains?
Dirk Röder: For me, blockchains are secure at their core when they are decentralized and have a diverse network of validators. Once data is anchored in the blockchain, it becomes difficult to change. This is due to the utilization of complex mathematical algorithms that encrypt transactions and ensure data integrity. Blockchains that are adequately decentralized distribute control among numerous network participants. Consensus mechanisms such as proof of stake secure the blockchain. They form new blocks and thus verify transactions. Additionally, any modification to a block requires changes to all subsequent blocks. These factors make attacks and manipulations more challenging. However, it is important to note that applications on the blockchain can still have security vulnerabilities, as demonstrated by past incidents. For instance, in May 2019, Binance, one of the largest cryptocurrency exchanges, was hacked, resulting in the theft of over 7,000 bitcoins valued at approximately $40 million at that time. Generally, I have observed an increased awareness of secure blockchain ecosystems and a greater emphasis on decentralization among developers and companies.
How does Aleph Zero fit into the blockchain strategy of Deutsche Telekom MMS?
Röder: With Aleph Zero we are expanding our footprint in the Polkadot ecosystem, where we have already been active since 2021. It is our first time, that we are providing infrastructure for a privacy-enhancing blockchain network. It is outstanding, because Aleph Zero combines different technologies, e.g., Directed Acyclic Graph, novel consensus mechanisms AlephBFT, Zero-Knowledge Proof, and secure Multi-Party Computation. The above results in an independent network capable of achieving a subsecond time to finality while remaining highly scalable, and secure. It’s an important attribute to us over at Deutsche Telekom MMS as security and data protection are central.
“There are two important blockchain characteristics to Deutsche Telekom MMS: censorship resistance and security.”
What does Deutsche Telekom do in this context?
Röder: Deutsche Telekom is a trusted validator in the Aleph Zero ecosystem. With our cloud services, we guarantee reliable nodes, high transaction throughput and the necessary security. We monitor around 24/7, offer backup services and are not dependent on hyperscalers. Thus, we minimize failure risks and avoid network punishment mechanisms. If our automated solutions fail, our on-call service is 24/7 available as a final safety net. We also test ZKP applications in our Group environment.
What do you mean by zero-knowledge proof, multi-party computation, and Directed Acyclic Graph?
Röder: Imagine you want to prove to someone that you know a certain secret without revealing the secret yourself. Zero-knowledge proof (ZKP) is a technology used to prove the validity of a statement without revealing the actual statement. Aleph Zero uses ZKP for transactions. It does not reveal who is performing the transaction or what amounts are involved. This provides businesses and users with a high level of privacy and security - especially for sensitive data such as healthcare or finance. I'm excited by the combination of blockchain and zero-knowledge proof. Because with ZKP, privacy, security, trust, and efficiency can be improved.
In addition, rather than relying solely on zero-knowledge Aleph Zero introduces a “hybrid” approach, incorporating secure Multi-Party Computation (sMPC) to their stack as well. SMPC safeguards information by storing it off-chain across multiple nodes; the data is cryptographically divided into pieces so that no single network participant can learn anything about the contents of the data. Directed Acyclic Graph (DAG) is a fast and scalable alternative to blockchain technology. DAG organizes cryptocurrency data and transactions into graphs instead of blocks and chains.
"The blockchain of the future must be fast, secure, and decentralized for the true potential of blockchain to materialize."
What does the secure blockchain of the future look like to you?
Röder: There is not yet a perfect solution for the "blockchain of the future." It must be fast, secure, scalable, and decentralized for the true potential of blockchain to materialize. There are two important blockchain characteristics to Deutsche Telekom: censorship resistance and security. The first ensures that transactions remain immune to manipulation or exclusion, which is especially crucial as more value migrates to the digital realm. The second is making sure our customers are protected in the increasingly interconnected world. And, that users’ self-sovereignty and user context is preserved, which is crucial when it comes to enterprise blockchain adoption. As we witness the rise of the Internet of Values, built on public, decentralized blockchain networks, the role of reliable infrastructure providers become indispensable. This is precisely where we as Deutsche Telekom MMS want to be a forerunner.