The Blockchain is Supposed to be Immutable – Until it is Not

One of the supposed “benefits” of the blockchain is that it is immutable, meaning that once data is written to the blockchain it can’t be changed. Unless someone decides to change it.

Two incidents this week show that immutable is not always immutable. Which means that the fairy tale of the blockchain is permanent is just that – a fairy tale. It is permanent unless someone doesn’t want it to be permanent.

The first incident is Ravencoin. There was a bug in the software which they eventually patched, but in the meantime, four days of transactions had to be reversed. Kind of like what happens when you have fraud on your bank account. The bank puts the money back in your (the sender’s) account. Except, in this case, it was four days of every transaction that was conducted on that blockchain.

There are only TWO mining pools that handle the majority of the Ravencoin transactions and they are in the process of reversing every transaction that occurred during those four days, including legitimate ones. Meaning that sellers who thought they had money don’t actually have money. Several exchanges have halted deposits and withdrawals of that coin knowing that there is going to be a LOT of complaints. It also means that they are “closed for business” until the chain is completely reverted. Credit: Coindesk

The other is the Harmony token. It plunged 40% when an attacker was able to mint 4 BILLION tokens. The massive increase of tokens caused the price of the token to plunge. Harmony “paused” the bridge to other exchanges. Harmony is considering rolling back the chain to undo the mess to the “pre-attack” state, but *IF* the attacker moved coins “off the chain”, it becomes a lot harder, if not impossible, to undo. The longer they wait to make a decision, the harder it will be to undo; the greater the reputation damage from the so-called immutable chain becoming very mutable. Credit: Coindesk

Bottom line is that the block chain is only immutable because some IT folks say they don’t want to “mute it” and not because it is actually unchangeable.

The good news is that every time someone mutates an immutable chain it reduces the confidence that users may have in the chain. That, by itself, will reduce the odds of others choosing to mute (I am not sure what the opposite of immutable is:) )their chain ). But it also means that you should not take too much stock in a database being unchangeable.

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