Blockchain technology stands at the forefront of a movement favouring decentralization and shying away from the need for intermediaries. This is observed in blockchain’s function as the supporting platform for digital currencies, and in its potential to disrupt various industries outside of the world of finance. Now, in a world with #DeleteFacebook, decentralization is becoming increasingly relevant in the world.While blockchain technology is not always used in decentralized applications, one of the technology’s key functions is its ability to sustain platforms like Bitcoin and Ethereum, which allow users to make and receive payments without relying on intermediaries like banks or corporations.
In March 2018, Facebook found itself in a major scandal involving data privacy. Reportedly, 50 million Facebook profiles were harvested through a technique that extrapolated data from personality quizzes, which was used to profile and target voters in the United States. The story broke after a 28-year-old Canadian, Christopher Wylie, a former employee of Cambridge Analytica, blew the whistle on the company’s alleged practices.As Wylie revealed, Cambridge Analytica (of which former Trump adviser Steve Bannon was a board member until 2016) sourced data from millions of Facebook profiles. Allegedly, this information helped the company market to specific demographics during the 2016 U.S. presidential campaign.Since the report, a trend called #DeleteFacebook found immense popularity online. The resulting backlash caused Facebook’s stock price to dip significantly in the days following the story. More importantly, the communal outrage reignited questions about how corporations like Facebook view their users. Questioning the role of intermediaries and corporations reflects many of the principles behind the decentralization movement. Proponents of decentralization wish to be viewed as more than a product, and think they should be in control of their own data.
In late 2017, one of the world’s largest consumer credit reporting agencies was victim to a major security breach. Known as the Equifax breach, it purportedly affected 145.5 million Americans. Stolen information included the full names, contact information, and even Social Security numbers (SSNs) of millions of people. According to reports, the vulnerability that hackers used during the breach was reported to Equifax in March 2017. However, the Equifax breach occured months later, suggesting that the company did not take proper precautions to address the issue. The Equifax breach highlights two key faults in centralized systems. Firstly, blockchain advocates argue that you should be in control of your own data, which would make these types of breaches less likely to occur. Secondly, central systems are typically home to a major security concern that is not present in decentralized systems - a single point of failure. Centralized networks have a lot of information protected by a single party, meaning hackers only have to breach one system in order to gain access.Blockchain technology, on the other hand, is viewed as highly secure due to the way that the network stores information. In a blockchain system, there is no single point of failure, meaning that hackers would have to breach each node in the network simultaneously to avoid being detected. According to proponents, this heightened security makes blockchain networks nearly impossible to to compromise.
Findings from the 2017 Edelman Trust Barometer display shifts in public opinion that seem to compliment the popularity of the decentralization movement. This barometer measures a country’s trust in the government, businesses, the media, and NGOs. In Canada, Edelman identified a shift in current influence structures, suggesting that the power balance is starting to tip in favour of the public, rather than remaining in favour of institutions. “Mass population now has influence and authority,” the report stated. “The establishment [is] left empty-handed.” According to Edelman’s findings, only 40% of Canadians expressed confidence in the media, 38% expressed confidence in Federal Parliament, and only 30% have faith in major corporations. Further, Canadian trust in Financial Industry Analysts and CEOs is at an all-time low. These findings also discovered that Canada slipped from its historically ‘neutral’ rating into the ‘distruster’ category in 2017, reflecting a growing lack of institutional trust amongst the public.With blockchain technology continuing to emerge as a prominent technology in recent years, its ability to cater to ‘distrusters’ seems to be a factor in its adoption. As the public reject placing faith in traditional institutions, more turn to trustless transaction systems. With blockchain technology, users can facilitate transactions without having to trust corporations or intermediaries.
One major issue with blockchain is the fact that the technology obtains its heightened security at the expense of speed. While blockchain is able to function quickly in small systems, furthered adoption slows the network significantly. This is because blockchain technology verifies information across all participating devices. Currently, security over speed is a major prohibitive factor for Bitcoin and Ethereum’s usage in day-to-day spending and could prevent other platforms from using blockchain for wide-scale use. Additionally, a paper that the Bank of Canada published stated that blockchain is not necessarily required for the ‘blockchain movement,’ with the author believing that praise instead belongs to blockchain’s adjacent technologies.
Institutions like the Toronto-based Blockchain Research Institute are currently investigating real-world applications for blockchain technology. Further, major companies like IBM are dedicated to implementing blockchain across a wide variety of industries.Blockchain technology’s champions and pioneers currently lead the revolution and are helping to create a world that is able to function without relying on intermediaries. Overall, decentralization could play an important role in the future of a society that is becoming increasingly unwilling to trust major corporations.Image credit: Facebook logo
Buy Bitcoin, Ethereum, XRP, and other cryptocurrencies on Coinsquare.
[maxbutton id="2"]
