Blockchain Security Background
Proof of Stake blockchains rely on a decentralized network of participants called validators to keep the blockchain operational and secure. Validators lock up large amounts of crypto as collateral in order to be eligible to validate and add data to the blockchain in a process called staking. As the total value of assets staked by validators increases, the cost associated with attacking the network becomes exponentially greater, and thus the blockchain is considered more secure. As more validators participate in a blockchain’s Proof of Stake consensus and more tokens are staked by different validators, the chances of the network failing due to validator negligence or validators colluding to attack the network decreases significantly, and thus the blockchain is considered more decentralized.
It’s incredibly important for any blockchain to be secure and decentralized or the assets held by users of the blockchain are at risk. On certain Proof of Stake blockchains like Umee, an attacker needs to control ⅓ of the total staked tokens in order to censor transactions, and ⅔ of the total staked tokens in order to corrupt the network. If the value of assets stored on a blockchain is greater than ⅔ of the value of assets staked on a blockchain, the blockchain becomes profitable to exploit and thus becomes a target for attackers. Generally, the mature blockchains with a proven history of success capture and maintain the majority of value. Therefore, as more blockchains are developed for different use cases less capital is available to help secure each individual new network, and thus newer networks are more likely to suffer attacks.
It can also be difficult for newer blockchains to rally the support of a large network of decentralized validators. There is a cost associated with running a validator, and all validators need to have some level of technical expertise in order for the blockchain to operate as intended. Validators generally only want to validate on blockchains where the likelihood of profit is high, and are less likely to support certain experimental endeavors. If a Proof of Stake blockchain is unable to attain a highly decentralized validator set, it doesn’t offer much of an advantage over a regular database.
What is Interchain Security?
Interchain Security is a technology built for Cosmos blockchains which allows a well-established “Provider Chain” with a high value staked on it to provide security for a less-established “Consumer Chain.” A Consumer Chain is a blockchain that rents security from a Provider Chain, and thus enjoys high levels of decentralization and security it would likely be unable to attain on its own. Consumer Chains are better secured with Interchain Security because the cost to attack the network is tied to the total staked value on the Provider Chain. Depending on the agreement between a Consumer Chain and a Provider Chain, stakers on the Provider Chain may earn a portion of a Consumer Chain’s tokens in exchange for the security provided.