Alterations in Personal Data Protection Bill

Pretext

The Army Welfare Education Society has informed the Parents and students that a Scam is targeting the Army schools Students. The Scamster approaches the students by faking the voice of a female and a male. The scamster asks for the personal information and photos of the students by telling them they are taking details for the event, which is being organised by the Army welfare education society for the celebration of independence day. The Army welfare education society intimated that Parents to beware of these calls from scammers.

The students of  Army Schools of Jammu & Kashmir, Noida, are getting calls from the scamster. The students were asked to share sensitive information. Students across the country are getting calls and WhatsApp messages from two numbers, which end with 1715 and 2167.  The Scamster are posing to be teachers and asking for the students’ names on the pretext of adding them to the WhatsApp Groups. The scamster then sends forms links to the WhatsApp groups and asking students to fill out the form to seek more sensitive information.

Do’s

• Do Make sure to verify the caller.
• Do block the caller while finding it suspicious.
• Do be careful while sharing personal Information.
• Do inform the School Authorities while receiving these types of calls and messages posing to be teachers.
• Do Check the legitimacy of any agency and organisation while telling the details
• Do Record Calls asking for personal information.
• Do inform parents about scam calling.
• Do cross-check the caller and ask for crucial information.
• Do make others aware of the scam.

Don’ts

• Don’t answer anonymous calls or unknown calls from anyone.
• Don’t share personal information with anyone.
• Don’t Share OTP with anyone.
• Don’t open suspicious links.
• Don’t fill any forms, asking for personal information
• Don’t confirm your identity until you know the caller.
• Don’t Reply to messages asking for financial information.
• Don’t go to a fake website by following a prompt call.
• Don’t share bank Details and passwords.
• Don’t Make payment over a prompt fake call.

Introduction

The Central Electricity Authority (CEA) has released the Draft Central Electricity Authority (Cyber Security in Power Sector) Regulations, 2024, inviting ‘comments’ from stakeholders, including the general public, which are to be submitted by 10 September 2024. The new regulation is intended to make India’s power sector more cyber-resilient and responsive to counter emerging cyber threats and safeguard the nation's power infrastructure.

Key Highlights of the CEA’s New (Cyber Security in Power Sector) Regulations, 2024

• Central Electricity Authority has framed the ‘Cyber Security in Power Sector Regulations, 2024’ in the exercise of the powers conferred by sub-section (1) of 177 of the Electricity Act, 2003 in order to make regulations for measures relating to Cyber Security in the power sector.
• The scope of the regulation entails that these regulations will be applicable to all Responsible Entities, Regional Power Committees, Appropriate Commission, Appropriate Government and Associated Power Sector Government Organizations, and Training Institutes recognized by the Authority, Authority and Vendors.
• One key aspect of the proposed regulation is the establishment of a dedicated Computer Security Incident Response Team (CSIRT) for the power sector. This team will coordinate a unified cyber defense strategy throughout the sector, establishing security frameworks, and serving as the main agency for handling incident response and recovery. The CSIRT will also be responsible for creating/developing Standard Operating Procedures (SOPs), security policies, and best practices for incident response activities in consultation with CERT-In and NCIIPC. The detailed roles and responsibilities of CSIRT are outlined under Chapter 2 of the said regulations.
• All responsible entities in the power sector as mentioned under the scope of the regulation, are mandated to appoint a Chief Information Security Officer (CISO) and an alternate CISO, who need to be Indian nationals and who are senior management employees. The regulations specify that these officers must directly report to the  CEO/Head of the Responsible Entity. Thus emphasizing the critical nature of CISO’s roles in safeguarding the nation’s power grid sector assets.
• All Responsible Entities shall establish an Information Security Division (ISD) dedicated to ensuring Cyber Security, headed by the CISO and remain operational around the clock. The schedule under regulation entails that the minimum workforce required for setting up an ISD is 04 (Four) officers including CISO and 04 officers/officials for shift operations. Sufficient workforce and infrastructure support shall be ensured for ISD. The detailed functions and responsibilities of ISD are outlined under Chapter 5 regulation 10. Furthermore, the ISD shall be manned by sufficient numbers of officers, having valid certificates of successful completion of domain-specific Cyber Security courses.
• The regulation obliged the entities to have a defined, documented and maintained Cyber Security Policy which is approved by the Board or Head of the entity. The regulation also obliged the entities to have a Cyber Crisis Management Plan (CCMP) approved by the higher management.
• As regards upskilling and empowerment the regulation advocates for organising or conducting periodic Cyber Security awareness programs and Cyber Security exercises including mock drills and tabletop exercises.

CyberPeace Policy Outlook

CyberPeace Policy & Advocacy Vertical has submitted its detailed recommendations on the proposed ‘Cyber Security in Power Sector Regulations, 2024’ to the Central Electricity Authority, Government of India. We have advised on various aspects within the regulation including harmonisation of these regulations with other rules as issued by CERT-In and NCIIPC, at present. As this needs to be clarified which set of guidelines will supersede in case of any discrepancy that may arise. Additionally, we advised on incorporating or making modifications to specific provisions under the regulation for a more robust framework. We have also emphasized legal mandates and penalties for non-compliance with cybersecurity, so as to make sure that these regulations do not only act as guiding principles but also provide stringent measures in case of non-compliance.

References: 

1. https://cea.nic.in/wp-content/uploads/notification/2024/08/Draft_CEA_Cyber_Security_in_Power_Sectyor_Regulations_2024_English_Version.pdf

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What are Decentralised Autonomous Organizations (DAOs)?

A Decentralised Autonomous Organisation or a DAO, is a unique take on democracy on the blockchain. It is a set of rules encoded into a self-executing contract (also known as a smart contract) that operates autonomously on a blockchain system. A DAO imitates a traditional company, although, in its more literal sense, it is a contractually created entity. In theory, DAOs have no centralised authority in making decisions for the system; it is a communally run system whereby all decisions (be it for internal governance or for the development of the blockchain system) are voted upon by the community members. DAOs are primarily characterised by a decentralised form of operation, where there is no one entity, group or individual running the system. They are self-sustaining entities, having their own currency, economy and even governance, that do not depend on a group of individuals to operate. Blockchain systems, especially DAOs are characterised by pure autonomy created to evade external coercion or manipulation from sovereign powers. DAOs follow a mutually created, agreed set of rules created by the community, that dictates all actions, activities, and participation in the system’s governance. There may also be provisions that regulate the decision-making power of the community.

Ethereum’s DAO’s White Paper described DAO as “The first implementation of a [DAO Entity] code to automate organisational governance and decision making.” Can be used by individuals working together collaboratively outside of a traditional corporate form.  It can also be used by a registered corporate entity to automate formal governance rules contained in corporate bylaws or imposed by law.”  The referred white paper proposes an entity that would use smart contracts to solve governance issues inherent in traditional corporations.  DAOs attempt to redesign corporate governance with blockchain such that contractual terms are “formalised, automated and enforced using software.”

Cybersecurity threats under DAOs

While DAOs offer increased transparency and efficiency, they are not immune to cybersecurity threats. Cybersecurity risks in DAO, primarily in governance, stem from vulnerabilities in the underlying blockchain technology and the DAO's smart contracts. Smart contract exploits, code vulnerabilities, and weaknesses in the underlying blockchain protocol can be exploited by malicious actors, leading to unauthorised access, fund manipulations, or disruptions in the governance process. Additionally, DAOs may face challenges related to phishing attacks, where individuals are tricked into revealing sensitive information, such as private keys, compromising the integrity of the governance structure. As DAOs continue to evolve, addressing and mitigating cybersecurity threats is crucial to ensuring the trust and reliability of decentralised governance mechanisms.

Centralisation/Concentration of Power

DAOs today actively try to leverage on-chain governance, where any governance votes or transactions are directly taken on the blockchain. But such governance is often plutocratic in nature, where the wealthy hold influences, rather than democracies, since those who possess the requisite number of tokens are only allowed to vote and each token staked implies that many numbers of votes emerge from the same individual. This concentration of power in the hands of “whales” often creates disadvantages for the newer entrants into the system who may have an in-depth background but lack the funds to cast a vote. Voting, presently in the blockchain sphere, lacks the requisite concept of “one man, one vote” which is critical in democratic societies.

Smart contract vulnerabilities and external threats

Smart contracts, self-executing pieces of code on a blockchain, are integral to decentralised applications and platforms. Despite their potential, smart contracts are susceptible to various vulnerabilities such as coding errors, where mistakes in the code can lead to funds being locked or released erroneously. Some of them have been mentioned as follows;

Smart Contracts are most prone to re-entrance attacks whereby an untrusted external code is allowed to be executed in a smart contract. This scenario occurs when a smart contract invokes an external contract, and the external contract subsequently re-invokes the initial contract. This sequence of events can lead to an infinite loop, and a reentrancy attack is a tactic exploiting this vulnerability in a smart contract. It enables an attacker to repeatedly invoke a function within the contract, potentially creating an endless loop and gaining unauthorised access to funds.

Additionally, smart contracts are also prone to oracle problems. Oracles refer to third-party services or mechanisms that provide smart contracts with real-world data. Since smart contracts on blockchain networks operate in a decentralised, isolated environment, they do not have direct access to external information, such as market prices, weather conditions, or sports scores. Oracles bridge this gap by acting as intermediaries, fetching and delivering off-chain data to smart contracts, enabling them to execute based on real-world conditions. The oracle problem within blockchain pertains to the difficulty of securely incorporating external data into smart contracts. The reliability of external data poses a potential vulnerability, as oracles may be manipulated or provide inaccurate information. This challenge jeopardises the credibility of blockchain applications that rely on precise and timely external data.

Sybil Attack: A Sybil attack involves a single node managing multiple active fake identities, known as Sybil identities, concurrently within a peer-to-peer network. The objective of such an attack is to weaken the authority or influence within a trustworthy system by acquiring the majority of control in the network. The fake identities are utilised to establish and exert this influence. A successful Sybil attack allows threat actors to perform unauthorised actions in the system.

Distributed Denial of Service Attacks: A Distributed Denial of Service (DDoS) attack is a malicious attempt to disrupt the regular functioning of a network, service, or website by overwhelming it with a flood of traffic. In a typical DDoS attack, multiple compromised computers or devices, often part of a botnet (a network of infected machines controlled by a single entity), are used to generate a massive volume of requests or data traffic. The targeted system becomes unable to respond to legitimate user requests due to the excessive traffic, leading to a denial of service.

Conclusion

Decentralised Autonomous Organisations (DAOs) represent a pioneering approach to governance on the blockchain, relying on smart contracts and community-driven decision-making. Despite their potential for increased transparency and efficiency, DAOs are not immune to cybersecurity threats. Vulnerabilities in smart contracts, such as reentrancy attacks and oracle problems, pose significant risks, and the concentration of voting power among wealthy token holders raises concerns about democratic principles. As DAOs continue to evolve, addressing these challenges is essential to ensuring the resilience and trustworthiness of decentralised governance mechanisms. Efforts to enhance security measures, promote inclusivity, and refine governance models will be crucial in establishing DAOs as robust and reliable entities in the broader landscape of blockchain technology.

References:

‍https://www.imperva.com/learn/application-security/sybil-attack/

‍https://www.tripwire.com/state-of-security/blockchain-security-understanding-vulnerabilities-and-mitigating-risks

‍https://medium.com/@RedStone_Finance/the-oracle-problem-and-its-implications-for-blockchains-c0c0ad9cf5a7

‍https://www.linkedin.com/posts/satish-kulkarni-bb96193_what-are-cybersecurity-risk-to-dao-and-how-activity-7048286955645677568-B3pV/ https://www.geeksforgeeks.org/what-is-ddosdistributed-denial-of-service/ Report of Investigation Pursuant to Section 21 (a) of the Securities Exchange Act of 1934: The DAO, Securities and Exchange Board, Release No. 81207/ July 25, 2017

‍https://www.sec.gov/litigation/investreport/34-81207.pdf https://www.legalserviceindia.com/legal/article-10921-blockchain-based-decentralized-autonomous-organizations-daos-.html