Blockchain and Web 3.

0 Security
Prof. Gazy Abbas
Cyber security trainer

Prof. Gazy Abbas

 Unit - 5
Web 3.0 Security Challenges

Prof. Gazy Abbas

Identity and Access Management (IAM)
Identity and Access Management (IAM) is a framework of policies and
technologies for ensuring that the right individuals have the appropriate access to
technology resources. IAM systems are essential for securing information systems
and ensuring that only authorized users can access resources.

Key Components of IAM:

Identity Management: This involves creating, managing, and deleting user
identities. It includes the processes and tools used to manage user accounts and
credentials, such as usernames and passwords, across various systems.
Access Management: This involves controlling who has access to resources in an
IT environment. Access management ensures that users are granted appropriate
access rights and permissions to use resources like applications, networks, and
databases. Prof. Gazy Abbas
Identity and Access Management (IAM)
Authentication: This is the process of verifying the identity of a user or system.
Common methods include passwords, biometrics, and multi-factor authentication
(MFA).

Authorization: This is the process of granting or denying specific requests to

access resources based on the user's identity and permissions.

Role-Based Access Control (RBAC): This approach restricts access based on the
roles of individual users within an organization. Users are granted permissions to
access only the information necessary to perform their job functions.
Single Sign-On (SSO): This allows users to authenticate once and gain access to
multiple systems or applications without needing to log in again.
Prof. Gazy Abbas
Decentralized Identity Solutions
Decentralized identity solutions, often associated with blockchain and Web 3.0
technologies, aim to give individuals more control over their personal
information. Unlike traditional IAM systems that are managed by centralized
entities, decentralized identity solutions distribute control and verification across
a network.

Decentralized identity solutions represent a significant shift from traditional

identity management systems by placing control and ownership of personal data
in the hands of individuals rather than centralized authorities. These solutions
leverage technologies such as blockchain and cryptographic techniques to create
secure, user-centric identity systems.

Prof. Gazy Abbas

Key Concepts of Decentralized Identity Solutions
Self-Sovereign Identity (SSI):

Ownership: Individuals own and control their digital identities without relying
on intermediaries.

Data Minimization: Users only share necessary information, reducing the

amount of personal data exposed.

Portability: Identities and credentials can be used across multiple platforms and
services.

Prof. Gazy Abbas

Key Concepts of Decentralized Identity Solutions
Decentralized Identifiers (DIDs):
Unique, persistent identifiers created, owned, and controlled by the
individual, independent of any central authority.

Structure: DIDs are typically associated with DID Documents containing

cryptographic material and service endpoints.

Standardization: DIDs are standardized by organizations like the World

Wide Web Consortium (W3C).

Prof. Gazy Abbas

Key Concepts of Decentralized Identity Solutions
Verifiable Credentials:
Claims: Cryptographically secure claims about an individual (e.g., name, age,
education) that can be verified without revealing the underlying data source.
Issuers, Holders, and Verifiers: Entities issue verifiable credentials, individuals
hold them, and other entities verify them.

Blockchain Technology:
Immutable Ledger: Blockchain provides a tamper-proof ledger for recording
identity-related transactions.
Decentralization: No single entity controls the network, enhancing security and
trust Prof. Gazy Abbas
How Decentralized Identity Solutions Work
• Identity Creation:

Generate DIDs: Individuals create DIDs using cryptographic methods. These

DIDs are registered on a blockchain or distributed ledger.
Create DID Document: A DID Document is created, containing the DID,
associated public keys, and service endpoints.

• Credential Issuance:
Issue Credentials: Trusted entities (e.g., universities, employers) issue
verifiable credentials to individuals.
Store in Wallets: Individuals store these credentials in digital wallets
(software or hardware-based).
Prof. Gazy Abbas
How Decentralized Identity Solutions Work
• Authentication:

Prove Identity: When accessing a service, individuals use their digital wallet
to present necessary credentials.
Cryptographic Proof: The service verifies the credentials through
cryptographic proofs without needing to contact the issuer.

• Authorization:
Access Control: Based on verified credentials, access to resources is granted
or denied.
Smart Contracts: In some systems, smart contracts automate authorization
based on predefined rules.
Prof. Gazy Abbas
Benefits of Decentralized Identity Solutions
• Enhanced Privacy:
Data Minimization: Only necessary data is shared, protecting user privacy.
User Control: Users decide what information to share and with whom.

• Improved Security:
Cryptographic Methods: Strong cryptographic techniques reduce the risk of
identity theft and fraud.
Decentralization: Eliminates single points of failure common in centralized
systems.

Prof. Gazy Abbas

Benefits of Decentralized Identity Solutions
• Interoperability:

Standards Compliance: Adoption of standards like DIDs and verifiable

credentials ensures compatibility across platforms.
Global Usability: Credentials can be used globally, across different services
and jurisdictions.

• Reduced Costs:

Eliminate Intermediaries: Reduces reliance on third-party identity providers,

lowering costs for both individuals and organizations.
Efficiency: Streamlined verification processes reduce administrative overhead.
Prof. Gazy Abbas
Authentication and Authorization in Web 3.0
In web 3.0, authentication and authorization
methods differ significantly from traditional
Web 2.0 practices.Web 3.0 gives users
greater control over their identities and data.
Users own their cryptographic keys and can
interact directly with decentralized
applications without intermediaries.
Web 3.0 leverage cryptographic keys,
decentralized protocols, smart contracts,
and token-based access control to provide
users with greater control, security, and
interoperability.
Prof. Gazy Abbas
Authentication in Web 3.0
• Web3 authentication is a login process that
verifies the identity of a web-based
application user with their public key rather
than an email or username. Think of a public
key like an account number.
• Authentication refers to the process of
verifying the identity of a user or system. In
Web 3.0, authentication is generally handled
using cryptographic methods rather than
traditional username/password combinations.

Prof. Gazy Abbas

Cont...
Key Concepts:
1. Private and Public Keys:
In Web 3.0, users authenticate using
cryptographic keys. A user has a private key,
which is kept secret, and a public key, which is
shared publicly.
The public key is derived from the private key,
and it serves as the user's identity on the
blockchain.

Prof. Gazy Abbas

Cont...
Key Concepts:
2. Signature-Based Authentication:
To authenticate a user, a dApp can ask the user to
sign a message with their private key. This proves
that the user controls the corresponding public
key.
Example: A dApp might request a signature for a
nonce (random number) to verify that the user is
indeed who they claim to be.

Prof. Gazy Abbas

Cont...
Key Concepts:
3. Wallets:
Blockchain wallets (e.g., MetaMask, Trust
Wallet) store private keys and manage user
identities. Wallets allow users to sign transactions
and prove ownership of their accounts.
When a user connects to a dApp, the wallet
handles the authentication process by signing
messages or transactions with the user's private
key.

Prof. Gazy Abbas

Cont...
Key Concepts:
4. MetaMask and Other Web3 Providers:
MetaMask and similar Web3 providers facilitate
the authentication process. They prompt the user
to approve transactions or sign messages, which
proves their identity.

Prof. Gazy Abbas

Authorization in Web 3.0
Authorization is the process of granting or denying
access to resources based on the authenticated identity.
In Web 3.0, authorization is often handled through smart
contracts and decentralized mechanisms.
Key Concepts:
1. Smart Contracts:
Smart contracts are self-executing contracts with code
that runs on the blockchain. They enforce access control
rules and permissions.
Example: A smart contract might define roles (e.g.,
admin, user) and restrict certain functions to specific
roles.
Prof. Gazy Abbas
Authorization in Web 3.0
2. Decentralized Authorization:
In a decentralized environment, authorization decisions
are often made based on on-chain data. This contrasts with
traditional systems where authorization is handled by a
central authority.
Example: A DAO (Decentralized Autonomous
Organization) might use token holdings to grant voting
rights or access to certain features.

Prof. Gazy Abbas

Authorization in Web 3.0
3. Token-Based Authorization:
Tokens can represent access rights or permissions. For
instance, holding a specific ERC-20 token might grant
access to certain features or services.
Example: Access to premium features in a dApp might
require holding a certain number of utility tokens.
4. Role-Based Access Control:
Smart contracts can implement role-based access control
(RBAC) to manage permissions. For instance, only the
contract owner or an authorized party can call certain
functions.
Example: A voting smart contract might restrict the voting
function to registered voters. Prof. Gazy Abbas
 Section - 2
Privacy and Data Security

Prof. Gazy Abbas

Privacy and Data Security
Privacy and Data Security refer to practices and technologies aimed at protecting
personal information and sensitive data from unauthorized access, use,
disclosure, disruption, modification, or destruction.

Privacy involves ensuring that personal information is collected, used, and shared
in ways that protect individuals' personal details and their right to control their
own data. This includes implementing policies that comply with privacy laws and
regulations (e.g., GDPR, CCPA).

Data Security focuses on safeguarding data from cyber threats and ensuring the
integrity, availability, and confidentiality of data. This includes using encryption,
access controls, and secure communication protocols to protect data from
breaches and cyberattacks.
Prof. Gazy Abbas
Data Storage & Sharing in Decentralized Environments

Data Storage and Sharing in Decentralized Environments refers to the management

and distribution of data across a network of nodes (computers) without relying on a
single central authority.

• Decentralized Storage involves

distributing data across multiple
nodes, ensuring redundancy and
resilience against data loss and
tampering. Examples include IPFS
(InterPlanetary File System) and
decentralized cloud storage
services like Filecoin and Storj.
Prof. Gazy Abbas
Data Storage & Sharing in Decentralized Environments
• Data Sharing in decentralized environments allows participants to share and
access data in a peer-to-peer manner, maintaining control over their data
without relying on a central entity. Technologies like blockchain enable
secure and transparent data sharing, as all transactions and data exchanges
are recorded on a distributed ledger.

• Challenges include ensuring data consistency, managing data replication,

and providing security in a trustless environment where participants may
not know or trust each other.

Prof. Gazy Abbas

Data Storage in Decentralized Environments
Decentralized Storage Systems

1. InterPlanetary File System (IPFS):

• Concept: IPFS is a peer-to-peer protocol that allows data to be stored and shared
across a distributed network. Rather than storing data on a central server, IPFS
uses a decentralized network of nodes.
• Content Addressing: Data in IPFS is identified by a unique hash (content
address), which ensures data integrity and allows for efficient retrieval.
• Distributed Hash Table (DHT): IPFS uses a DHT to locate and retrieve data from
the network. Nodes store and manage data based on its hash.

Prof. Gazy Abbas

Data Storage in Decentralized Environments
Decentralized Storage Systems

2. Filecoin:
Concept: Filecoin builds on IPFS by providing an incentive layer. It allows users to
rent out unused storage space on their devices in exchange for Filecoin tokens.
Proof of Replication and Proof of Spacetime: These consensus mechanisms ensure
that data is stored reliably over time and is accessible when needed.

3. Arweave:
Concept: Arweave focuses on permanent data storage. It uses a novel data structure
called a "blockweave" to ensure that data, once stored, remains available
indefinitely.
Endowment Model: Users pay a one-time fee to store data permanently, with the
cost covering future storage and retrieval.
Prof. Gazy Abbas
Data Storage in Decentralized Environments
Data Fragmentation and Redundancy

Sharding:
Concept: Sharding involves dividing data into smaller pieces (shards) and
distributing them across multiple nodes. Each shard contains a portion of the data,
enhancing scalability and redundancy.
Benefits: Improves performance and fault tolerance by reducing the load on
individual nodes and ensuring that data remains accessible even if some nodes fail.
Data Redundancy:
Concept: Redundancy involves replicating data across multiple nodes to ensure its
availability. Redundant copies protect against data loss and increase reliability.
Implementation: In decentralized storage systems, data is often replicated across
nodes based on specific redundancy policies.
Prof. Gazy Abbas
Data Storage in Decentralized Environments
Encryption and Data Integrity

End-to-End Encryption:
Concept: Data is encrypted on the client side before being uploaded to the
decentralized storage network. Only authorized users with the decryption key can
access the data.
Benefits: Ensures that data remains confidential and protected from unauthorized
access.
Hashing:
Concept: Data is hashed to create a unique identifier (hash) that verifies its
integrity. Hashes are used to detect any tampering or corruption of data.
Implementation: Hashes are often used in conjunction with content addressing in
systems like IPFS.
Prof. Gazy Abbas
Data Sharing in Decentralized Environments
1. Decentralized Identity and Access Control

Self-Sovereign Identity (SSI):

Concept: SSI allows users to manage their digital identities without relying on
central authorities. Users control their identity data and share it selectively.
Verifiable Credentials: Users can issue and verify credentials in a decentralized
manner, ensuring that identity information is trustworthy and accurate.

Decentralized Identifiers (DIDs):

Concept: DIDs are a new type of identifier that enables verifiable, decentralized
digital identities. DIDs are managed by users and can be used to authenticate and
authorize interactions.
Usage: DIDs are used for secure authentication and authorization in decentralized
applications.
Prof. Gazy Abbas
Data Sharing in Decentralized Environments
2. Data Sharing Protocols

Permissioned Sharing:
Concept: Data sharing is controlled through permissions defined by smart contracts
or access control lists. Users can grant or revoke access to specific data based on
permissions.
Implementation: Smart contracts can enforce access control rules, ensuring that
only authorized parties can access or modify data.
Public vs. Private Data:
Public Data: Data that is accessible to anyone in the decentralized network.
Examples include public blockchain data and public IPFS files.
Private Data: Data that is restricted to specific users or groups. Private data can be
stored in encrypted form and shared based on user permissions.
Prof. Gazy Abbas
Data Sharing in Decentralized Environments
3. Interoperability and Integration

Cross-Chain Communication:
Concept: Facilitates interactions between different blockchain networks.
Cross-chain protocols and bridges enable the transfer and sharing of data across
chains.
Examples: Polkadot and Cosmos are platforms that support cross-chain
interoperability.
Decentralized Oracles:
Concept: Oracles are services that provide external data to smart contracts.
Decentralized oracles aggregate data from multiple sources, ensuring accuracy and
reliability.
Usage: Oracles are used to fetch real-world data for smart contracts, such as price
feeds or weather information.
Prof. Gazy Abbas
Privacy-Focused Blockchain Solutions
Privacy-Focused Blockchain Solutions are blockchain technologies and
implementations designed to enhance privacy and protect user data within the
blockchain network.

• Confidential Transactions: These

are methods used to hide
transaction amounts and other
sensitive details while still ensuring
the integrity of the transaction.
Techniques like zero-knowledge
proofs (ZKPs) enable verification of
transactions without revealing the
underlying data.
Prof. Gazy Abbas
Privacy-Focused Blockchain Solutions
▪ Zero-Knowledge Proofs (ZKP):
ZKPs are cryptographic protocols that allow one party to prove to another
that a statement is true without revealing any information beyond the
validity of the statement itself.

▪ Secure Multi-Party Computation (MPC):

MPC allows multiple parties to jointly compute a function over their inputs
while keeping those inputs private. Each party learns only the result of the
computation and nothing about the other parties' inputs.
▪ Fully Homomorphic Encryption (FHE):
FHE enables computations to be performed on encrypted data without
needing to decrypt it first. The result of the computation remains encrypted
and can only be decrypted byProf.
theGazy
owner
Abbas of the private key.
Privacy-Focused Blockchain Solutions
• Privacy Coins: Cryptocurrencies specifically designed to provide enhanced
privacy features. Examples include Monero, which uses ring signatures and
stealth addresses, and Zcash, which employs zk-SNARKs (Zero-Knowledge
Succinct Non-Interactive Arguments of Knowledge) to conceal transaction
details.
• Private Smart Contracts: Smart contracts with built-in privacy features, allowing
for the execution of contract logic without exposing sensitive data. Projects like
Secret Network and Oasis Network focus on creating privacy-preserving smart
contracts.
• Decentralized Identity: Solutions that allow users to maintain control over their
identity information, sharing only necessary details and reducing the risk of
identity theft. Projects like Sovrin and uPort aim to provide decentralized
identity management systems. Prof. Gazy Abbas
 END

Prof. Gazy Abbas

www.paruluniversity.ac.in
Prof. Gazy Abbas