One of the biggest advantages of blockchains is the fact that they are reliable and safe networks, especially in terms of cybersecurity. Its safety is enforced by the fact that all of the blocks are locked with cryptography, but it is not completely invulnerable to cybersecurity threats.

One such threat is a replay attack, a cyber threat in which a hacker or other malicious entity is able to intercept and recreate valid transaction data from a network, successfully bypassing the need to decrypt the transaction logs. Understanding how this happens is very useful in order to try and stop them and avoid fraud.

What Is a Replay Attack?

A Replay Attack happens when a malicious party manages to break into a network and intercept parts of a valid data transmission in order to bypass the cryptography in a blockchain. Since that data is valid, naturally it does not get rejected, defeating the purpose of the cryptography in the first place, opening up a vulnerability within the network.

Even though they are not exclusive to them, this type of attack has a destructive potential in blockchains. That is due to the fact that in order to be able to proceed with it, it means that the perpetrator has had access to valid credentials, opening up room for them to access information within the network (generating a privacy breach), withdraw money directly from their victim’s account, duplicate transactions to fool financial institutions and steal information that may be used for further exploitation at a later time.

Despite the serious concerns this type of attack brings to the blockchain-sphere, the amount of damage that can be done by hackers with replay attacks alone is limited. While harmful to users and some financial institutions reliant on blockchain, the attackers are not able to change the data that is being sent (thus, compromising the entire chain) because the network is set to reject it as an invalid entry. These attacks are also easily combated, by simply inputting a timestamp to data transmissions in order to halt copy and past and replay attempts. There are also protective measures that can be put into place by servers in order to limit transactions with the same code.

Why Are Replay Attacks Important in Blockchain?

Even though they are considered easy to rebuttal in most blockchains, and are far from exclusive to them, the risks imposed by these attacks still must be taken seriously. In the context of Cryptocurrency transactions, networks will eventually go into protocol changes and updates where the transaction ledgers split in two parts: one running the original version or the software and the other one running the updated version, as a safety implementation measure. That process is known as a hard fork and it is used within a blockchain to implement updates to the ledger or even branch off and expand to form new chains.

During these massive upgrades and updates, theoretically the blockchain could be open to more vulnerability, making it easier for attackers to run a replay attack against both ledgers, generating duplicate transactions that will be validated by both protocols and create a fraudulent coin transfer. That is only possible to happen by utilizing wallets that are present within a blockchain before and after the hard fork happens.

How Can Blockchains Stay Safe Against Replay Attacks?

Despite the alleged vulnerability that hard forks present when they happen, there are two categories of security protocols in existence to safeguard transactions during that time:

Strong Replay Protection

In this type of protection, new ledgers will automatically receive an unique marker that enforce the security of transactions, making sure that they will not be valid on the original branch of the fork. This is usually in place during upgrades that will create a new branch for the blockchain.

Opt-In Replay Protection

In this replay protection, users are required to manually implement changes to their transactions in order to make sure that they are not able to be replayed. This is usually requested of users when the hard fork is intended to bring upgrades to the main blockchain ledger, instead of creating new branches.

Individual Replay Protection

Besides the blockchain-wide protection measures, there are also steps that individual wallet owners are able to take in order to avoid becoming the victims of replay attacks:

• Remain vigilant with your transactions. When it is an option, wait during hard forks until the new ledger has a few number of blocks, before inputting your own;

• Wait until your transactions have been verified before accepting the transaction as valid in case of buying or selling a product online;

• Pay attention to updates and warnings about what is going on with a blockchain.

• Use a secure communication protocol: HTTPS encrypts the communication between the client and server and provides integrity checks to detect any tampering. This means that an attacker will not be able to intercept and replay the authentication request.

Conclusion

Replay Attacks are a cybersecurity breach that are made in a way to bypass the cryptography that makes Blockchain safe and private, in order to make fraudulent transactions. In theory, this type of attack is capable of compromising security, especially during hard forks - upgrade periods that happen in blockchains seasonally - but there are measures put in place to avoid these attacks to be successful.

Users are either able to both implement safety measures themselves (opt-in replay attack) or in some blockchains the network will add a special mark to the transactions during hard fork periods (strong replay protections) in order to safeguard against these attacks. Either way, despite the threat against privacy and information security, replay attacks are not a way to completely compromise the integrity of the blockchains.