Can Blockchain Technology Create a Trustless Internet Experience?by Sebastian Schuhl
The following blog post dives into the grander project of blockchain technology, the need for a trustless Internet experience, and why the Facebooks and Amazons need a sharp reality check. Since their inception, many have turned to each of these Internet platforms as much as they turn to their light switches, public transport, and other utilities. Fortunately, an alternative technology is emerging to upset this narrative.
Facebook Is not a Utility
It goes without saying that the Facebooks of the world are incredibly valuable. Not only do they help families, businesses and other communities stay in contact all over the world, they have also unveiled novel social interactions. What needed a letter sent in the post a hundred years ago, a telephone call thirty years ago now may only need a click of the “like” button. The convenience is outstanding, and it's important that we don’t forget this; this is the new standard. Anything that falls short of this, will never be taken seriously.
The other side of this realization also comes with a host of new ethical considerations, however.
Likely the biggest story from 2018 was the Cambridge Analytica scandal in which Facebook was used as a “psychological warfare tool” to sway massive swaths of Internet communities during the 2016 presidential election in the United States. Even before this watershed moment, The Guardian reported that the British firm was also working for Ted Cruz in 2015.
On the one hand, Facebook has become so essential to our lives that parting with Zuckerberg’s creation takes incredible resourcefulness. On the other, the Silicon Valley-based company is now being leveraged for much greater ends than wishing your friends a happy birthday. What’s more, the Facebook founder was the very first person to ever experiment with such leaks.
And while Facebook has promised to fight against politically-motivated user manipulation, many have already left the platform due to this initial breach of trust. With this informal contract broken, and populations becoming more and more aware of the value of their data, Zuckerberg has an uphill battle ahead of him.
Defining Trust: Oil and Data
Establishing trust between users and a service is fundamental business practice. We trust plumbers, technicians, and tradespeople to apply their expertise to the best of their ability in order to resolve relevant problems.
In the case of Facebook, the first people to use the service trusted that the information they were giving would merely allow them to connect with different students at Harvard. Ultimately, regardless if digital or otherwise, we trust that the information we are providing won’t be used against us to surveil our every move or to manipulate the outcome of a critical election.
We also trust that this information will be guarded against malicious parties and that the sensitivity of this data will be taken seriously. Trust, these days, means that although we use Facebook to send our good wishes to a colleague, this information is near impossible to access for anyone except for us and our colleagues. Rarely is this the case, however.
Consider the Yahoo breach that began in 2013. Early estimates indicated that 500 million users had had their names, addresses, telephone numbers, and dates of birth all compromised. Revised estimates in 2017 determined that the breach had actually affected all three billion user accounts and the data included security questions and even more granular data on users.
Trust, in the common era, is the new oil. Facebook, Google, and Amazon are all technically free to use, but what many still don’t realize is that trust is actually a multi-billion dollar industry. All three platforms sell this trust to the highest bidder in the form of highly-specific advertisements.
For advertisers, Facebook is a goldmine, as the sheer amount of underlying data enables much more precise targeting than any other marketing channel. This leads to better targeting with less scatter loss. And, in theory, even users profit from this, as only relevant advertisements, catering towards users’ interests are shown to them.
While this may achieve a perfectly curated Internet experience, the value capture is in the hands of a few. Not only that, but this small oligarchy are notoriously susceptible to security breaches.
The Promise of Blockchain
Bitcoin helped make blockchain technology one of the biggest buzzwords in IT circles all over the world. As the magic Internet money touched $20,000 at the end of 2017, financiers, supply chain outfits, and art collectors began learning more about the infrastructure underpinning the pioneer cryptocurrency.
To be clear, digital value transfer is still blockchain technology’s best use case. There is no doubting that the ability to send $62 million for only $4.50 is incredibly powerful. On the periphery of this, however, are the seedlings of a more ethical and open Internet experience.
Imagine that, like Bitcoin, you are your own Facebook, Google or Amazon. You are in complete control of your online identity, what data you want to share, and are paid each time a third-party service uses your data. This is the promise of blockchain technology; it hopes to break up the “platformication” of the Internet and put power back in the hands of users, not corporations. In a peer-to-peer blockchain environment, the individual is always the owner of its own data, not a corporation. Taking an element of trust, as in trusting a company to handle your private data with care, out of the equation, thus, enables a “trustless” environment.
However, we're only at the beginning of this evolution. To get a better idea of how crypto pioneers are building out a Web 3.0, read about the power of community (not companies), decentralizing the firm (with a DAO), and creating a narrative around transparency for the next generation of the Internet at our blog.