Relying on centralized databases makes Dapps vulnerable to data manipulation, says Nate Holiday – Interview Bitcoin News
Decentralized applications (dapps) are vulnerable to data tampering because they are “largely built on top of centralized databases and services,” Space and Time CEO Nate Holiday has said. The CEO also shared a list of data manipulation risks that he said are specific to data warehouses.
Companies that rely on centralized databases and services
According to Nate Holiday, CEO of decentralized data warehouse Space and Time, the recent loss of funds on defi (decentralized finance) lending platform Lodestar Finance, and Axie Infinity’s Ronin network attack before that, are important events that remind users that decentralized apps ( dapps ) is susceptible to data tampering. Although he admits that many dapps are powered by blockchain, Holiday still claimed that many of these applications are “largely built on top of centralized databases and services.”
As recently reported by Bitcoin.com News, the hacker behind the $6.9 million siphon from Lodestar Finance had tampered with “the exchange rate of the plvGLP contract.” The hacker then followed this up by delivering the plvGLP security to Lodestar and borrowing all available liquidity.
Commenting on the recent incidents of data manipulation, Holiday said that dapps, just like centralized business organizations, can have a single point of failure that leaves them vulnerable to hacks. This in turn reduces their appeal to users, Holiday argued.
“Data tampering can have disastrous effects for dapp users. For example, if a decentralized financial application leverages a centralized database, data tampering. In the case of a decentralized social media platform, data tampering can lead to harmful impersonation or the spread of false or misleading information,” Holiday explained to Bitcoin.com News.
Single point of failure
Meanwhile, the Space and Time chief also shared a list of data manipulation risks specific to data warehouses, and these include hacking centralized database systems and gaining unauthorized access. The use of SQL injection techniques to manipulate data, and tampering with the database structure or schema are the other risks.
When asked to explain why he advocates for decentralized blockchain-anchored computing solutions, Holiday said:
“Decentralized architectures have no single point of failure, and blockchain anchoring ensures that data is secure and immutable. This architecture provides an ideal solution for decentralized applications that require trustless interactions, such as those used by financial services or supply chain management.
While he doesn’t expect a sudden shift to decentralized data services, Holiday insisted that “enterprises are becoming increasingly aware of the need to integrate blockchain data into their business models.” To help such companies, the CEO said his company helps “companies integrate data from the centralized databases that drive their business.”
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