Why Blockchain is The Key to Data Privacy in The Future

This point in time in the 21st Century will be one for the history books, for several reasons. Society is in the midst of massive and sudden changes, which goes without saying for the role of technology in our lives. In fact, technology is the main driver of change. Of all the things that rule our life, technology is going to be number one going forward as we increasingly depend on it for absolutely everything every day. Let’s think about this: we invest most of our time in this crazy thing we invented called the internet, and in return, we have developed it to such a level that we share almost all of our most personal information with this mysterious virtual space. We orchestrate our most basic and existential needs online too and communicate with our dearest friends and family members online, not to mention convene with other people. Think about this, too: there are over 30 billion devices online, as well as over half of the Earth’s population. These dizzying numbers show that it is impossible to quantify just how drastically our lives have changed in the past decade alone. In the 2000s, only 20 years ago, nobody had a smartphone in their hand and hardly anyone had a computer at home.

What is the result of our collective reliance on the internet?: The digital transformation that is taking place. Proof of this is that most essential critical services are now accessible online, as are social media and almost every other resource out there can be found online. Millions of us do not even go to the office for work anymore, and instead, work from the comfort of our homes. Just to illustrate this point again: the internet is even changing education. Finance? That too. We’ve even made the transition to digital currencies, which will soon push paper money (FIAT currency) into non-existence. Medicine? You can now speak to doctors online, and get your prescriptions delivered. Shopping? You can now get packages delivered to you by an internet-connected drone. It is impossible to list all of the ways technology has improved our lives. You name it, the internet can almost certainly do it for you.

This is all fine and dandy, but what are the drawbacks? Well, there is a big, lumbering drawback: data privacy. As far as data privacy is concerned, there have been huge waves there as well in the past few years. Trust towards big tech companies is at record lows, as is trust towards the government. Data privacy, data security, and personal anonymity are on everyone’s mind nowadays. Likewise, the move away from mainstream tech products due to a desire to be free and free of surveillance is also happening. So then, the question is how revolutionary technologies will challenge the privacy status quo? This is one of the reasons why the cryptocurrency is the private currency of the future. It isn’t just financed though, as multiple other industries are already benefiting greatly from the privacy that blockchain technology innately offers.

The connecting factor is blockchain technology: potentially the saviour of our species.

What is Blockchain Technology And How is it Used?

According to one of the fathers of IT, IBM, blockchain technology is “a shared, immutable ledger for recording transactions, tracking assets and building trust.” This is a very humble, technical way to describe blockchain technology which is destined to change our society. Blockchain is the work of incredibly clever and talented visionaries including cryptographers, mathematicians, and computer scientists who sought out to create an open-source decentralized ledger technology. 

The technology itself stems from a mysterious, yet unconfirmed entity known as Satoshi Nakamoto. Blockchain appeared suddenly with the announcement of a P2P (peer-to-peer) version of the paper money we know today. That happened between 2008-2009. This revolutionary new way of working with currency was to be named Bitcoin. The world found out about the inner workings of Bitcoin that is based on this revolutionary blockchain technology. 

Also, read Is Blockchain Technology the Future of Transactions?

How Blockchain Promises to Improve Security And Privacy

According to the Financial Times, “Blockchain is to Bitcoin, what the internet is to email. A big electronic system, on top of which you can build applications. Currency is just one.” Blockchain has multiple uses, only one of which is currency. These are;

  • Money transfers and payment processing
  • Monitoring supply chains
  • Digital ID and biometrics
  • Sharing of digital data in digital marketplaces
  • Royalty and copyright protection
  • Digital voting
  • Any business transfers that involve paper and paper trails
  • Backing up data
  • Drawing up smart contracts between multiple parties
  • Compliance and tax regulation
  • Safekeeping of medical records
  • Monitoring IoT (Internet-of-Things)

As you can tell, like any revolutionary state-of-the-art paradigm, blockchain technology has trickled down from specialists to the public domain and it is going to change how we operate as a society. The internet was once a military project, now 5-year olds and 90-year-old grandmas use the internet.

Most importantly, apart from being almost instant and very efficient, removing third-party risks as well as offering untraceable encryption, blockchain is substantially going to change the realm of cybersecurity and data privacy. Additionally, blockchain removes the need for centralization e.g. for someone to own or operate your assets. It gives you the ability to control transactions and has that added peace of mind. Blockchain’s main goals are complete transactional anonymity, instantaneous data transfer, high-level encryption of data, and the removal of the need for paper and paper trails.

Here is one real-world example of the benefits of blockchain technology; you decide to buy a house and need to go through a multi-step process to do so. You need to hire a lawyer just to determine the legitimacy of the transaction. Secondly, you need to go through a real estate agent which is another tedious process that means you pay even more fees. All of this also means physically commuting, waiting in traffic, and travelling back and forth multiple times. With a blockchain real estate platform, you can inspect the legitimacy of the real estate (as well as the real estate itself), avoid lawyer fees as well as agent fees. The real estate property can also be registered digitally, so loans and notary transactions are out of the window. Furthermore, automated smart contracts massively improve the ownership transition and ownership process. Finally, the payment is instant, absolutely private, and secure. The entire process is legal and binding, to boot, only massively improved.

Finally, let’s take a look at how blockchain technology changes voting, governance and fights corruption. Some countries, such as Switzerland and Dubai (Smart Dubai) are hard at work at being blockchain and crypto-friendly in all aspects of the operation. Dubai wants to leverage this approach in creating the happiest city on Earth. One example of this is voting, and the other is transparent government practices. The use of blockchain automatically removes corrupt, hidden operations and gives the public insight into how the government is operating. It also allows for fair, transparent, and publicly monitored voting.

Of course, there are going to be some problems implementing blockchain all over the world. For it to work, all stakeholders of a country or city need to participate and be in agreement with blockchain transformation. This means everyone from the citizens to the business owners and government itself. According to the Smart Dubai portal, the savings alone from eliminating document processing thanks to blockchain operations will save over one billion dollars each year.

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