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Facebook and More: How Blockchain Provides a New Way to Protect Data Privacy

In this week’s five-hour-long Facebook hearing in front of United States Senate Judiciary and Commerce committees, the term “data privacy” was brought up and debated over numerous times, without landing on ultimate solution how industry or legislative bodies can go about tackling it.In addition to questions about Cambridge Analytica’s improper access to the personal data of 87million Facebook users, broader issues were discussed including transparency, data ownership, and the disadvantages of concentrating the data in the hands of a few companies like Facebook.

Unfortunately, this is not the first, nor will it be the last such data breach. The intrinsic drawbacks of centralized platforms are roadblocks to a more transparent, secure and efficient network. From this week’s hearings, the following characteristics were brought up multiple times :

1. Expectation gap on “privacy”. A typical internet user's expectation of privacy is drastically different from the notion of privacy laid out by Facebook’s 37,000-word-long terms of service. Whether this gap is deliberately constructed, or just historically emerged, it does generate disappointment, and eventually distrust among user community .

2. Asking users to “opt out” rather than to“opt in”.Since the data refineries including Facebook and Google profit mainly from targeted advertising based on user data, they try to ask users as infrequently as possible to authorize anything — after all, they might not give their permission if you ask them. While deleting your Facebook account might on the surface sound like a solution to data privacy, completely “opting out” is no longer an option in a world nowhere the communication infrastructure for billions of people relies products including Facebook’s Messenger and Whatsapp, and Tencent’s QQ and WeChat in China. Provide an “opt in” solution will be important to give control of personal data back to users.

3. Misaligned incentives. Modern internet is built based on one important condition: free to use. Incentives are naturally mismatched between businesses who consume the data for targeted advertising or even election manipulation, and users who contribute the data not expecting it to be used for commercial or political purposes. New business model and economics should be built around the use of data.

As a long-time big data researcher and advisor, I have always been a firm believer in the positive impact data can bring to individuals, companies and society. To solve the problems of creating value from data without violating privacy, it is necessary to rethink data can in a framework of transparency and trust. After closely observing the evolution and application of blockchain technology in the past years, I believe a decentralized data marketplace is the right step to (re-)gain trust.

Blockchain: A Panacea to Privacy?
The truth is, the use of data is not just about keeping user data private. As angry as Facebook users are about the lack of intergrity of top management of the firm that has more monthly active users than any state has citizens, they obviously do not want to be back in the world where every single data transaction was done by mail. The subtle triangle of the user of data hereby is:
1) Authorizing/De-authorizingof Data
2) Validating of data accuracy
3) Aligning incentives of data exchange
While blockchain technology is not the panacea to all of Facebook’s problems, it does provides a new angle to understand how data should be stored, validated, shared and monetized.


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