When money and tech collide, people enjoy certainty and calculated precision. However, there’s also sometimes a need for the element of randomness. What seems like a simple concept is actually quite the rabbit hole that has bearings on finance, cybersecurity, and the evolving world of cryptographic tech.
Randon Number Generators
Wherever we create randomness digitally, it’s through random number generators. These create unpredictable outputs, whether it’s a string of numbers or something more advanced. When you use a password manager, you can generate passwords with an RNG, for example.
RNGs are more widespread than you may think. For example, consider the pivotal role they play within the entertainment industry: the online casino sector relies heavily on randomness to ensure that all players are subjected to fair and equal odds when engaging in gambling games. The luck of the draw is very important to the brand’s overall ethics and consistency.
Particularly in the online realm with games such as online roulette and other classic card games like poker, baccarat, and blackjack, players must be assured that the foolproof measures taken on a tangible casino floor are reinforced online. RNGs essentially meet this need. In addition, variants of traditional casino games like live-streamed sessions with real-time croupiers are held to the same standard. However, an RNG mechanism doesn’t need to be utilized in this scenario due to the professionalism of the croupier overseeing the game.
Randomness In Cybersecurity & Cryptography
At present, the RNGs we use are advanced enough to fool humans. That is, they’re random enough that we can’t predict them. There’s a good reason our random generation methods are so advanced – they are important for cybersecurity.
Since algorithms ultimately determine the output of random number generators, there’s a debate over if they are really random in the same way randomness occurs in real life. That’s why you may see the term pseudorandom if you research more into this space since it’s not the same kind of unpredictability that we get from real life.
It’s great that RNGs fool us as intended, but when it comes to cybersecurity and cryptography, they need to fool other algorithms that may try to crack them. Becoming unpredictable to another computer is an even bigger ask. Throw in the expected arrival of quantum computing and its importance becomes even clearer.
Similarly, there are cryptographically secure generators that are designed to outmaneuver attackers which are only becoming more advanced now that blockchain is here. Impending blockchain adoption in many sectors should improve cryptography’s ability to create randomness, to the benefit of the cybersecurity field as a whole.
The Impact On Fintech
Given its use in cybersecurity, the importance of randomness in fintech should be pretty clear. Where software is used to facilitate money transfers and support banking infrastructure, it is paramount that all its operations are protected from bad actors. If you want to find some of the best cybersecurity measures in the world, look at big-name services where money is handled online.
It’s not just a practical concern – if any financial service is compromised in a bad way, it can ruin its reputation and hold business back even after they have solved the issue and shored up security. This is especially the case if the service holds data that gets compromised, putting customers’ personal information at risk, since that can’t be resolved by getting a new security system.
The risk of failed cybersecurity in fintech is simply more catastrophic than getting locked out of your social media account. There are real-world implications that include reputational damage and even stock price changes, if the company is publicly traded. By keeping up to date with the latest methods for ensuring randomness and thwarting attack, fintech benefits more than perhaps any other industry.
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- Source: https://www.fintechnews.org/why-randomness-is-important-for-fintech-cryptography/
