The blockchain technology promises better data privacy, stronger security, and more data control for consumers. Therefore, our world could benefit from blockchain, particularly with regards to consumer privacy.
For years now, corporations like Google and Facebook have amassed huge sums of profits from gathering consumer data. However, consumers are getting the short end of the stick as the only benefit they get in return is just some free web services.
Instead of allowing companies to profit from your data, should you not monetize your own data? When you gain more control over your data, your privacy is better protected too. Furthermore, online scams and phishing are so rife nowadays, so we should place more priority on cybersecurity and consumer privacy.
Technologically, consumers can gain more control over their data with blockchain. But like any major innovation, implementing blockchains come with risks along with other complexities. From high implementation and maintenance costs to climate change concerns, mass adoption of blockchain raises both hope and concerns.
In this post, let’s explore some of the impacts that could arise from mass adoption of blockchain. Then we can better understand how blockchain can change your perception about privacy.
The Revolutionary Technology of Blockchain
A blockchain is essentially a digital ledger that records transactions securely and transparently across a decentralized network of nodes. These nodes are basically computers that act as validators of the transactions.
Unlike in traditional financial systems controlled by centralized authorities and intermediaries, blockchain operates on a peer-to-peer basis. This means people like you and me can send data directly to each other on the blockchain without a middleman. This data can be our digital money, emails, messages, digital assets, etc.
Just take for example your money that you keep in the bank. Unlike trusting your bank to store your money, you can entrust your digital money to a blockchain. The blockchain acts as a vault that is secured through several mechanisms like cryptography, hashing and encryption techniques.
To get a better understanding about blockchain, you can read my post about how blockchain can solve some worldwide problems.
How Blockchains Can Improve Consumer Privacy
When you entrust your wealth to a bank, you are bounding yourself to terms and conditions set by the bank. Authorized personnel in the bank are also able to view your wealth as they pleased.
This is not the case if you store your digital assets on the blockchain (e.g. cryptocurrencies and NFT). Your digital assets belongs to you privately and there is no custodian. In fact, if you lose your private keys to your crypto wallet, you can say goodbye to your digital assets. In the blockchain, you cannot just reset your password or retrieve your private key.
Do you store a lot of photos, videos and messages on Facebook, Google and such companies? Well, do not assume that your personal things belong to you. The corporations would surely protect themselves with extensive privacy policies and terms and conditions filled with legal jargon. To better protect your data privacy, you should reconsider storing personal items on social networking sites or cloud services.
How Consumer Privacy Will Change With Blockchain
The price of Bitcoin had reached above above $100,000! Are you missing out on opportunities because you lack cryptocurrency knowledge?
You can enrol in free Bitcoin and cryptocurrency online courses with Alison. You only pay if you need the certificate and I may get a commission as an affiliate.
How Blockchain Can Grant You Freedom
I’d hope at this point you can imagine the freedom that you can gain by using blockchains.
Your real-world assets, NFT assets and digital money on the blockchain cannot be single handedly controlled by anyone. While some may see this advantage as a risk, it also means freedom as you are not bound by conditions set by someone else.
You can even regard cryptocurrencies as truly the people’s money because the currency is not controlled or issued by a single authority like a government. Just bear in mind though that with the widespread freedom, it means anyone with sufficient knowledge can create a form of digital currency on a blockchain.
This is the reason why cryptocurrency is such a revolutionary technology, especially when you put it in the context of money has controlled by governments and central banks for centuries!
Blockchain offer a host of other advantages but it will be too lengthy to list all of them. Just one advantage that is worth mentioning is that blockchain is regarded to be theoretically tamper-proof. This feature makes it a highly attractive technology in sectors where data security, accuracy and transparency are crucial.
For example, just imagine the host of societal benefits that a open blockchain system can bring forth in a country where the government officials are corrupt. When there is less corruption within a government, surely the people will gain more freedom.
Consumer Privacy Could Be Worse Off With Blockchain
Despite blockchain’s widespread benefit, have you ever imagine what will be the consequences if masses of people favor cryptocurrencies and abandon the use of government-issued money?
At this point of time, very few people around the world pay heed to cryptocurrency. But looking at how consumers love to use credit cards, debit cards and e-wallets, it is not far fetched to say that cryptocurrency can prove to be alluring if it offers convenience and speed.
You should also ask yourself if you would really want anyone in the world to be able to see where all your monies goes on a blockchain. Hence, it seems like the democratization of money that is happening now comes at the cost of having our money transactions monitored even more closely in addition to government surveillance.
Because of the open nature of blockchains, programmers are inventing various mechanisms that would allow people to maintain a higher degree of privacy over their cryptos’ transactions. However, I hope you are well aware that total data privacy is practically not possible within the digital realm as every bit of our data can certainly be tracked by someone who possesses sufficient technical know-how.
Conclusion
Will the decentralized Web dominate the Internet in the years to come? Well, it is definitely difficult to predict the future of Web3 even though Bitcoin has existed for nearly two decades now.
Blockchain technology is still very much in its infancy at the moment but it is already in the experimental stages of redefining how industries operate. For now, there is still quite a lot of optimism surrounding Bitcoin as United States is adopting Bitcoin as a strategic reserve. In addition, Bitcoin is also recognized as legal tender in El Salvador.
While the adoption rate of cryptos among consumers is still very low, consumer trends could change very rapidly if laws and regulations around cryptos grant more freedom and accessibility to the people.
