Consumers have been receptive towards sharing their data with companies fearing privacy breach. The same was concluded when McKinsey conducted a research on 1,000 North Americans. Enterprises have been finding it hard to operate in areas where GDPR rules are the strongest like the European Union.
What is the cost of not accessing the right data at the right time?
When Tim Cook announced his three new Apple Watch variants Series 8, SE, and Ultra, his core vision was to provide an unprecedented monitoring network tied among specific stakeholders in such a way that it could benefit people at large. The vision was undoubtedly noble and it has some credible instances to quote. An independent 54 year old UK resident named David Last was saved by his Apple Watch ECG feature that instantly alerted the hospital that David’s heart rate has fallen abruptly and he requires instant help.
But there’s a dark side w.e.f. data collection and interpretation where big techs use data analytics via AI & ML to influence consumer habits. At such instances, the thin line between trust and profitability fades away. And that’s where the need for blockchain arises to restore that trust among enterprises and consumers.
What can Blockchain achieve?
Blockchain has the potential to remodel the way data exchange can take place not just between B2C but even with the B2B models. Due to this feature of Decentralized Ledger Technology (DLT), enterprises can easily deal with their stakeholders who belong to a related but not their direct line of operation. To put that into perspective, the aviation industry can directly interact with the travel/tourism and transportation industry. Just imagine a traveller having a visa and passport which has been linked with various industries and checkpoints that he/she wants to explore when visiting a foreign country.
It has the potential to not only simplify experience but lead to better interoperability between industries and optimize the work dynamics. But how can the unthinkable be achieved through blockchain? Homomorphic Encryption is the answer that you seek.
What is homomorphic encryption?
It is the process of converting data into cypher-texts and doing complex mathematical computation to achieve the desirable results. To better explain this in a simple way, suppose Alice wants to ask Bob, who runs an exchange about top 5 high performing stocks. But she doesn’t want Bob to know which stock/crypto she can choose as her preferred portfolio. So what Alice does is create a private key and subsequently a public key for the query. For example, say the public key is 0,0,0,1,0. Bob receives the public key which he shall use to perform the computation and send back the results in cypher-texts to Alice which she can decode later through her private key.
Now Bob does the computation in the following way: A * B = C
For example, there are five cryptos which are top performing that Bob wants to compute and send back to Alice. So, Matic, ADA, Cardano, ETH, and BTC have values like 0,1,0,1,0. Now when Bob computes Alice’s request with homomorphic encryption, it gives some values to Alice which she can decode via her private keys. However, Bob can never find out which crypto she wanted to choose for her portfolio. Hence, he can never find out which crypto Alice wanted to purchase in the first place.
In the same way, enterprises can exchange data with non-trusted entities and allow them to compute on the same without revealing the data to the third party. Hence, establishing a trustless operation between homogeneous and heterogeneous businesses without the fear of non complying with the GDPR rules. Through restricted data anonymization, an incomplete hashing output is generated as in the case of Alice which can be decrypted only with those who are having the private keys.
Thus, consumers can share data with businesses while putting restrictive boundaries on how it can be used and what the business can achieve through that data without compromising their sensitive information. So, no more AI–data analytics fishing on e-Commerce websites and social media platforms. Homomorphic encryption simplifies data sharing with necessary stakeholders without compromising on the privacy.
A New Way Forward In Data Sharing and Computation
Homomorphic encryption helps enterprises do unilateral computation that ensures data integrity is not compromised and the bearer of the data is in full control of how it can be used and processed. In this way, through homomorphic encryption, privacy protection and business operations both can happen in tandem which could improve the experience of the consumers and at the same time, protect their sensitive information from leakouts and misuse.
Thus, helping enterprises for the first time to operate without the fear of retribution while working in regions that follow strict GDPR rules will not only create opportunities for businesses which are based out of the European Union but even help the consumers in Europe to experience new products and services without compromising on their safety and security.
And that too without the fear that they will have to pay €20 million or 4% of the profit of the company as fines for not complying with the GDPR rules. Hence, setting the narrative that it is high time enterprises should look forward to crypto and blockchain when they want to interoperate and work under strict data and privacy rules.
Conclusion
The narrative that data is the new oil has gone way too deep as we are heading for the sci-fi future ahead. However when something becomes expensive, there are many involved that want to abuse the same for profit maximization. We have already seen how the Middle East was exploited at the hands of the West on the pretext of WMDs. However the only self interest was oil and not humanitarian aids. The same has been happening with how enterprises are using the data.
On the pretext of providing personalized experiences and better buying opportunities, big techs are playing along. However through the use of blockchain tech and homomorphic encryption, one can easily put restrictive measures without jeopardizing the business interest.
VE3 as the front-runner in the latest emerging tech has helped clients operate in those jurisdictions where data abuse and subsequent penalties were at their highest. For example, in the EU, one of the clients of VE3 was facing strict challenges when it came to sharing data with the counterparties involved fearing compromise of sensitive information. To help ease that hassle, VE3 assisted the client set-up private nodes allowing restrictive entries to designated stakeholders. In this way, the supply chain business was able to automate the SCF using VE3 which significantly improved the settlement time of invoices from months to days. VE3 has also expanded in other verticals carving a name in the technology segment when it comes to innovating with the existing infrastructure of the enterprises.
