Seize Control of your Data, Money and Identity
By Magdalena Gronowska
The Central Party Predicament
For centuries we have trusted central parties to structure our society. We’ve placed our trust in governments for governance, decisions, and personal identity. Trusted banks and financial institutions to be custodians of our wealth. And we now trust corporations to be custodians of our data — we live in the data economy and voluntarily pay in personal data and privacy instead of money for online services. However, our trust in central parties continues to diminish with every recurring case of a corrupt government, personal asset seizure (bank haircuts in Cyprus), hack and company that mismanages data.
Momentum is building for alternative structures. A shift towards the decentralization of data, identity and trust is an appealing proposition. Instead of placing trust with a central party, we can democratize trust across system of people participating in a network — where we trust in the rules of the system, the economic incentives built in and that enough participants follow the rules and act rationally.
We also seek to regain control — we are building a world where we can control the keys to our own money, our identity, our data. For a long time in our history we would reach into our pocket and give our coins to someone. Citizens can again own the keys to their own money, limiting the ability of governments and banks to seize assets or limit the participation of the unbanked in the global financial economy.
Despite our transition to a digital economy, we continue to rely on physical documents to prove our identity or a specific attribute like age. From a privacy standpoint, it is unnecessary to show more information than is necessary — the bouncer just needs to know your age, not your address. In the future, we will be better able to control the attributes that are released in a secure and privacy preserving way. A world where we can we leverage technology to take back control of our data and privacy, also shifting the economics of data — whether its paying directly for services or monetizing our data.
Tradeoffs — C’est la Vie
As we embrace digital technologies, we concurrently open ourselves up to new threats and attack vectors. A new world where bad actors seek new ways to access to our personal, financial or corporate information, or our bank accounts, or try to disrupt our digital infrastructure. While individual and decentralized control has the advantage of the ‘honeypot’ (data, assets, etc.) being spread across many individual participants, the responsibility for security is shifted and personal opsec can be challenging for segments of the population. You regain control but you also take on the full responsibility of your own digital safe and key — and in the case of cryptocurrencies, most transactions are irreversible and misplaced ‘keys’ remain lost forever.
Technology & the Promise of Freedom
Decentralized technologies and applications are not yet intuitive. Usability remains a barrier to widespread adoption. The value and incentives for early adoption prevails in corrupt, destabilized or war-torn countries, where citizens face runaway inflation, persecution or asset seizure. Citizens recognize the enormous value of being able to flee with their digital assets or identity represented as a seed phrase in their head — one that cannot be forcibly taken at the border like gold. Good design and usability and scalability improvements will attract broader global consumer adoption.
We are creating new systems for the digital economy — as developers and builders and dreamers, we need to understand the limitations of both technology and users to get it right for the next generation.