The fight for user data — how it is collected, processed, and used — is one that will unfortunately never end. While there have been recent advances to give users back control of their data, such as the passage of the GDPR into law by the European Union, the battle is only just getting started.
The reality is that, for as long as it remains profitable (and it will be!), corporations will continue to do all they can to collect and manipulate user data. Facebook, for example, has a very profitable advertising business — raking in a massive $15 billion in Q1 2019.
Facebook continues to break advertising revenue records, defying analysts’ expectations, and this is only possible due to how much user data it has and how much control it has over it.
Unfortunately, as they say, “power corrupts and absolute power corrupts absolutely.” Sitting on so much data, as it recently started to come to light, it is difficult for a business entity not to make use of it — especially if it will guarantee more profit.
As it recently came to light, Facebook has repeatedly abused (and allowed others to abuse) user data in order to meet its revenue goals: this is evidenced by the Cambridge Analytica scandal, the fact that it shared user data with Chinese companies (including one deemed a national security threat by US intelligence agencies, and other similar data abuses.
Facebook has been repeatedly criticized for these abuses, but most of the critics are overlooking the fact: Facebook isn’t an isolated example. Companies, particularly bigger companies, will continue to abuse user data for as long as it is profitable and for as long as they can get away with it.
While stricter regulations, and enforcement, will significantly reduce abuse of user data, I don’t think it will stop it. Blockchain might hold a key promise, however, for the following reasons:
User Data is Decentralized — Making it Much Difficult to Abuse: Perhaps the biggest advantage blockchain provides when it comes to preventing user data from being abused is that it decentralizes user data. Facebook can only abuse user data because they control it, and because it is centralized with them. Blockchain decentralizes user data by storing it in a potentially infinite number of locations, making it difficult for any single entity to control it.
Furthermore, records stored on the blockchain are immutable and distributed among every user on the blockchain — each user in turn has their own private cryptographic key and can decide to keep their data encrypted or selectively reveal it.
Blockchain Ensures Transparency in How User Data is Used: Another way blockchain solves the issue of data abuse for ads that Facebook has been at the center of is by ensuring complete transparency in how user data is used. With user data on the blockchain, it is easy to monitor exactly how your data is being used and when.
This is very important in light of Facebook’s Cambridge Analytica scandal: the data harvesting began in 2014, the data was used in 2015 and 2016, yet word about this didn’t get out until 2018 — four years after the data was harvested. This is exactly the kind of stuff blockchain is designed to combat. When, where, and how user data is used is clear, and such data harvesting (if even possible — although, realistically, considering blockchain’s decentralized nature, it isn’t) would have been discovered and rendered ineffective before it is used.
Blockchain Gives User a Say in How Their Data is Used: Another key reason why Facebook is able to repeatedly abuse user data is because users not only do not have an idea how much data Facebook has on them, but they have no say in how this data is used.
Case in point, a recent research paper published by researchers from Northeastern University and Princeton University found that Facebook has been guilty of sharing data users did not submit and have no control of with advertisers. Worse, users cannot erase this data from Facebook’s record. This is exactly the kind of stuff blockchain is designed to address.
Blockchain makes it much more difficult to hack and access sensitive information: Besides protecting user data from monolithic entities like Facebook, blockchain also provides a strong layer of protection from bad actors. Since data is encrypted on a distributed ledger that stores the hash on every node on the blockchain network, a bad actor will need to take control of the majority of nodes to get access to information on the blockchain network. Not only is this a very difficult feat to pull off, but if and when this ever happens it will be extremely costly.