Can Blockchain Technology Offer Transparency to the Privacy & Security of Our Data?

From Equifax to Facebook, 2017 was the year of the data breach. With five of the ten largest breaches occurring this past year, over 65 percent of the American population had their personal information either stolen, sold, or studied by a third party without their consent. Yet, according to a report presented to the Federal Trade Commission (FTC) by PricewaterhouseCoopers, Facebook’s privacy controls implemented in 2011 were operating effectively.

The issue of data privacy and security is being “put under the microscope” by policymakers, but the potential solution might not be adding additional layers of regulations and legal liability on top of the antiquated legal and regulatory framework now in place. Perhaps technology can provide the best solution to protecting our online information.

As we discussed in an earlier piece, blockchain, or distributed ledger technology, can open many doors and solve a number of current problems, especially in the realm of improved efficiencies. Does it have a place here too? Our issues with data security stem from the fact that our data is centralized – it is collected by single proprietors, such as Google, Amazon, Facebook, and Apple (GAFA). What if our data was decentralized?

Blockchains can bring transparency to our social media platforms. A blockchain, for example, would allow us to see publicly with whom and for what purpose Facebook, or the other GAFA giants, is sharing our information. It is designed to be open, transparent, and public. So, it succeeds in security but fails in privacy. That is why we need cryptographic advances in secure computation, to create a privacy protocol that includes a blockchain. We can create a social network that is decentralized and blockchain-operated that uses nodes to sign a smart contract between new ‘friends’ and where posts, statuses, and pictures are be stored and shared with specific individuals on InterPlanetary File System (IPFS). Most importantly, if a merchant or business wants your data for targeted advertisements, smart contracts can be created for you to give your consent.

If tech companies, such as Enigma, continue to step up to the challenges of private, decentralized platforms; if Congress and relevant federal agencies get serious updating our antiquated privacy and security laws and regulations; and if the social media industry focuses first on its consumer/customers, a new online architecture might be the solution we need to this important issue.

Co-Authored by Patrick Firth, Michael Best Strategies, Washington, D.C.

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