To most people, bitcoin is simply a digital currency; however, those who understand its underlying blockchain technology know that it is actually a unchangeable ledger of all past transactional data. This ledger isn’t owned by an individual or even a company; rather, there is shared ownership by every person who has ever made a transaction in bitcoin or any other kind of cryptocurrency.
Blockchain’s decentralized nature makes it more secure than any existing government-regulated system. This is especially critical in time where privacy has become an increasingly significant problem. Today, large Internet corporations have maintained exclusive control over our customer data and have even monetized information through forms of advertising, solely for their own benefit. These blockchain-based protocols can allow customers to control and monetize their own personal data, empowering them in ways that were previously not possible.
Using blockchain, networks can securely share and obtain consumer preferences — for instance, your favorite stores could know that you’re searching for deals on a sweater or that you’re in the market for a new computer — without compromising the personal data that you don’t want them to access, unless you authorize it. One way that blockchain is able to do this is through the use of a private key. Using blockchain with private keys, people can pick and choose to authorize only select networks to access their personal data.
Smart contracts are another way that blockchain can safeguard privacy. Smart contracts are computer protocols that can verify, facilitate, and enforce terms of a contract by accessing external data off of the blockchain. This technology can replace the role of intermediaries by ensuring that all participating parties aren adhering to the laws of the transaction. In terms of retail, smart contracts ensure that all parties are operating under the same set of rules, preventing the chance of any malpractice.
The brick-and-mortar retail industry can significantly benefit from the adoption of blockchain. In fact, blockchain could spearhead the creation of a system that would let brick-and-mortar retailers provide a personalized shopping experience to anyone who walks into their stores using data that the customers can willingly choose to share. While this is exciting, the thought that retailers might be able to access your personal information can still seem a bit invasive. This is only heightened in the wake of recent critical hacks of customer information, such as the recent Equifax breach that compromised the personal data of over 143 million people.
However, with blockchain, customers can control exactly who is able to see their data, and even potentially monetize it when coupled with a cryptocurrency-based economy. A blockchain-based system could notify customers when a retailer wants to access to their consumer data, and can choose to deny or approve authorization to them. With the advent of blockchain, these heightened levels of data protection have become a reality, and it will prove critical in ensuring that consumers are fully in control of the privacy and security of their own personal data.