The social media giant shouldn’t mistake the forest for the trees. While Facebook continues to reel from a security breach involving the personal data of tens of millions of users, they may just have demonstrated the value of an unalterable public ledger, aka blockchain. RBC Capital Markets analyst Mitch Steves thinks so, according to a recent segment on CNBC, and he just may be onto something.
Cybersecurity is something that risk management teams continue to struggle to get ahead of, and the latest incident at Facebook is an example of just how damaging a breach can be. If you didn’t hear, a third-party data analytical company distributed without permission a heap of personal information it had scraped on millions of Facebook users. Facebook attempted to sweep it all under the rug, and now Mark Zuckerberg has offered a mea culpa.
Facebook on the blockchain would create a more secure world for its billions of users. Zuckerberg has kind of backed himself into a corner if he chooses to ignore the technology, given the backlash he’s received from the security breach, as evidenced by USD 40 billion slashed from the internet darling’s market cap.
But it’s more than just investor backlash. Wall Street and London’s financial district are questioning whether Facebook could survive another security incident, not to mention the response that the company could trigger from regulators. As a Wells Fargo analyst noted, “Facebook has since upgraded its user privacy functionality and app review process to prevent similar abuse.” But what if it’s too little, too late?
In the event of greater regulatory oversight, you could expect to see changes to your Facebook newsfeed, not to mention the ads that appear. Facebook has already issued a ban that extends to ICO and cryptocurrency ads.
It brings to the forefront an important point surrounding whether blockchain technology could have prevented an incident like this from happening in the first place.
On a day when Google unveiled its plans to develop its own blockchain, big tech is starting to realize they can’t stick their heads in the sand about blockchain any longer. Facebook on the blockchain, while a step in the right direction, wouldn’t submerge social media into decentralized territory. The company, not its users, controls the platform, and it would continue to do so even if posts were made on an unalterable, global online database like the blockchain.
But according to RBC’s Steves, what the blockchain would do is add another layer of transparency to the social media platform, so that users could monitor their data — whether it’s a post, picture or location — and know precisely whose hands it ends up in. Where a centralized blockchain falls short, however, is putting the originator of that data in the driver’s seat so that they could decide who gets to see the data and who doesn’t.
“You could 100% track all this stuff… if you use blockchain technology in the Facebook example.. you could track every single time that photo is sent. So let’s say I only wanted my mother to see it. I could see if she sent it to somebody else because there would be a digital footprint to track it. The problem that it does not solve if you use it in a centralized environment is it doesn’t stop them from doing it though.” – Steves on CNBC
In the case of the 2016 US presidential election, which is what Facebook’s latest data breach involved, blockchain could have meant that voters were not blindsided by the fact that their data had likely caught on like wildfire.
Featured image from Shutterstock.
Last modified: September 23, 2020 12:03 PM