Data privacy has rapidly become the number one concern among Internet users. With recent scandals involving data breaches, lack of user control, and third-party exploitation, it’s easy to understand why. However, this doesn’t mean that all hope is lost. There are various ways we can leverage blockchain technology to solve the data privacy dilemma through decentralized data exchanges, multi-party computation (MPC), and more.
After all, what good is decentralization if we can’t use it to protect our private information? Let’s take a closer look.
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Blockchain Data Privacy Solutions
There are a few ways that blockchain can help protect your data privacy. The most obvious solution is to limit who can access your data in the first place. While centralized databases are wide open for the taking, companies, and individuals can only access blockchain-based data with your permission.
Another way that blockchain can protect your data privacy is by letting you decide how long you want to keep your information on the blockchain. Centralized databases like Gmail and Facebook typically keep your information indefinitely. However, blockchain technology lets you set a deadline for when your data expires and gets deleted from the network.
One of the biggest challenges in data privacy is centralized data storage on a third-party server. After all, if a malicious hacker gains access to that third-party server, they can steal a wide variety of your personal information. This data storage model creates a centralized channel that malicious actors can exploit. Thus, it’s crucial to devise ways to decentralize data storage.
Thankfully, we have blockchain to help us decentralize data storage. By creating a blockchain-based decentralized storage network, we can ensure that your data is safely stored and encrypted locally. With decentralized storage, you’ll have greater control over your data and its use.
Another way that blockchain can protect your data privacy is by providing you with a blockchain-based identification. You can use this identification method to prove your identity and access different goods, services, and websites.
As opposed to the current identification system that uses government-issued identification, blockchain-based identification can be accessed with your unique, encrypted “fingerprint.” You can generate this identification fingerprint by encrypting your personal information, such as your name and address, with a blockchain public key.
This blockchain-based identification method is highly secure and incredibly difficult to hack. Even if someone were to steal your fingerprint, they would still be unable to decrypt your personal information. This makes blockchain-based identification an optimal solution for protecting your data privacy.
Blockchain-based dApps and MPC for Enhanced Data Protection
Another way that blockchain can protect your data privacy is through decentralized apps (dApps). Developers can build these dApps on the blockchain to ensure the security of your data. Decentralized apps are hosted on decentralized networks and use smart contracts to enforce the rules of engagement.
This means that decentralized apps have a level of security that far exceeds that of traditional apps. Decentralized apps also allow you to retain complete control over your data. Unlike conventional apps hosted on centralized servers, decentralized apps are hosted on distributed networks.
In addition, multi-party computing (MPC) adds additional privacy and security. The protocol offers the highest levels of privacy, protecting confidential data when appropriate and when user wants to, helping give them back control.
MPC works by splitting the traditional private keys into multiple pieces and distributing them in numerous places to ensure no one person has full access to the traditional private key. The major advantage here is that the private key is always used in a distributed manner, which makes it more secure.
In other words, MPC technology makes it much harder for potential hackers to gain control over a user’s wallet. To do so, they now need to attack multiple parties across different operating platforms at different locations simultaneously.
Are you inspired to design the future?
Decentralized storage, blockchain-based identification, and decentralized apps for enhanced data protection are all ways that blockchain can help protect your data privacy.
Between October 25 and November 14, Partisia Blockchain is running a hackathon focusing on finding solutions to problems like this. With two tracks – DeFi Beyond Crypto and Data Economy – hackathon participants will benefit from mentorship and workshops, meet fellow hackers and bring their web3 ideas to life on the MPC privacy-preserving blockchain.
Register now, and you could not only find the solution to the issue of DeFi and carbon credits, but you might be in the top 30 teams invited to the on-site event in Paris. You may even walk away with a share of an incredible grant pool, including a whopping $125k and $100k for the two best projects, respectively.