Shyft aggregates trust and contextualizes data to build an authentic reputation, identity, and creditability for individuals and enterprises.
We present a new framework to facilitate regulatory compliance to privacy standards, enforce accountability mechanisms between stakeholders in the data value chain, and fairly remunerate individuals for use of their personal data.
Why We Created Shyft Network
Shyft Network was born to solve some of the biggest threats to the digital asset ecosystem, but also, capture some of the largest opportunities for the world. The founders and team at Shyft have been involved in the cryptocurrency ecosystem since its inception and recognized early on that if we didn’t look towards solving problems with data integrity, personal identity, regulation, and policy, then the benefits and strengths of decentralized networks and cryptographic systems would never reach the critical mass and global adoption they are designed and destined for.
Why did we choose to call our network “Shyft”? We foresaw a necessary shift in the paradigms currently governing both decentralized and private, permissioned, and traditional networks. We realized that to pave a path for the digital asset space to expand, disparate networks need to be able to communicate and collaborate, despite differences in openness, governance and design.
As regulatory requirements began to bare down on the crypto ecosystem, the team recognized that a decentralized version of SWIFT (the messaging network used to route identity information across the financial system) would be needed to interoperate across all permissioned and permissionless networks, blockchain-based and otherwise. A paradigm “Shyft” is required in order to keep public blockchain networks open and available to people everywhere, especially where they begin to integrate with traditional financial systems. We are only as strong as the strength of our networks’ communication and the ability through the use of them to verify that communication is credible.
We set out to build and design a foundational infrastructure layer that unlocks entirely new trust-based economies. Shyft is designed to empower and bind trust between people, institutions, and sovereign nations, ultimately changing the way data is shared and secured. With the absence of regulation during the first few years of digital assets and the presence of subsequent misinformed regulation, our resolve and the philosophy behind our protocol design has only strengthened. We provide a trusted data layer between the physical and digital worlds. Additionally, we have designed a structure that supports and facilitates the opportunity for the 1.7 billion people with no formal identification to finally participate in the global economic system. Shyft Network activates global digital citizenship and puts control back into the hands of people.
When building a new paradigm and “Shyft”ing infrastructure, we look to integrate simple solutions that solve many problems simultaneously. The Internet directly solved how we transfer data across intermediaries, and thinking bigger, the Internet also enabled an entirely new world to emerge as an overlay to our physical world, continuing to expose new use cases still beyond our comprehension today.
Shyft Network’s core infrastructure layer in many ways resembles the foundational solution of the Internet in that it solves trusted data transfer across intermediaries. It also goes one step further by adding a consent framework to that trusted data transfer, empowering the data owners in addition to the data custodians. At the largest scale, Shyft Network enables use cases that span every industry and public sector activity that uses data, has a requirement to validate data, or that requires trust, participation, and contextual aggregation in order to better existing data-based use cases they currently support. The goal of Shyft Network is to cross enable new systems founded on trusted data protocols to interact and bind into traditional data systems.
Today’s Data Sharing and Custodianship Practices Are Insecure
There’s a good reason why today’s organizations are built around collecting and monetizing digital data. Data is unthinkably valuable. The personal data market is expected to grow to $330 billion by 2030, and 73% of consumer-facing businesses today collect individual data for business purposes. Organizations are making it more of a priority to collect data points that can be used in core business activities such as personalized target advertising to potential customers, market positioning against competitors, and product research. The data being collected on individuals day-to-day is massive; the average data broker has information on 700 million consumers worldwide.
Internal processes around storing and sharing data are not increasing in security and sophistication in lock-step with these higher rates of data collection. This leads to rampant vulnerabilities to consumer data collected by companies.
Organizations frequently need to access each other’s data, yet data sharing processes are incredibly insecure. Data exchange today requires custody exchange, leading to massive dissemination of sensitive data between organizations who have no business being data custodians. Data custodianship is expensive and difficult, requiring constant maintenance, stress-testing, and upgrades to security practices, especially considering the large global cost inefficiency multiple on aggregating, verifying, storing, and “securing” replications of the same data internally within thousands of organizations. Today, more than 50% of all stored data is either dark (has unknown value) or redundant, obsolete, or trivial. Just let that sink in.
Furthermore, incentives between what we call “Data Owners” (originators of data, such as internet users) and organizations that hold data “Data Custodians” are misaligned. Corporates view data security as an “operating cost”, spending the bare minimum capital and other resources to secure data. Accordingly, 29% of small businesses spend less than $1,000 on IT security annually, despite the fact that 80% of the businesses say IT security remains a top priority. The discrepancy between stated prioritization and actual security spend is shocking.
Due to the difficulty and costs of data custody, and insecure existing channels for data sharing, data hacks and leaks are rampant. The negative outcomes of data breaches are multi-pronged, and have drastic long-lasting negative effects on businesses and individuals alike. Ultimately, companies lose brand value, lose customers, and are forced to pay fines to regulatory bodies and remuneration to affected parties. The global average customer turnover rate caused per data breach is 3.9%, and increasing annually. Unacceptably, individuals and organizations whose data is revealed in hacks most often see untimely, little, or no recourse. Every day, 25 million data records are compromised worldwide, with over 1,200 reported breaches in 2018 alone. Assigning these breaches with a cost, in the US, is on average $7.91 million per breach.
Clearly, enterprises today need access to a system that allows for secure collection and sharing of the bare-minimum amount of sensitive user data, and users need access to an auditable trail reflecting sharing of their data between parties for full transparency and guaranteed remuneration.
Digital “Data Supply Chains” Don’t Exist Today
Today, it’s impossible to track and secure the collection, dissemination, and use of digital data. Individuals and entities whose data is collected, shared, and monetized never:
- Know who is collecting their data
- Know when their data is being collected
- Know when their data is shared
- Know which entities in the world today hold their data
- Know how their data is being used
- Realize the commercial value of their data
- See any of the capital returns generated from their data
Facebook uses 98 personal data points to target ads to individuals, yet individuals do not have access to these data points, and have no way to know how this data is being used. They don’t get to see the algorithms that spit out their social media feeds, nor the formula for deciding which ad should be targeted at them. Further, users see none of the profits Facebook makes selling ad space to purchasers based on their personal data as part of the sale. According to 2018 numbers, Facebook’s revenue per user was around $25.
The lack of an audit trail and marketplace around data doesn’t only impact consumers. In fact, 75% of vendors indicated that they believe their consumer data is incorrect, yet 55% of all companies confirmed that they use it to make decisions. By involving consumers in the process of validating the accuracy of collected data, companies can end up with data that is drastically more useful for customer acquisition and retention.
Ultimately, without transparent records and validation of data ownership, origination, custody, and sharing, users will never be able to own the rights to their data nor see any of the commercial value earned upon use of this data at the enterprise level, and enterprises will continuously fight the uphill battle of ensuring data security and authenticity.
Our Digital Identities Fail To Represent Us
Our entire lives are now lived, in one way or another, digitally, i.e., through mobile, online banking and shopping, social media, communication, education, etc…
- Half of a person’s web searches come from a mobile phone
- Google processes 3.5 billion searches
- 1.5 billion people are active on Facebook
- 16 million text messages are sent per each major telecom carrier
- 156 million emails are sent
- Venmo processes $52,892 p2p transactions
- Uber riders take 45,788 trips
- Snapchat users share 527,760 photos
- 120 professionals join LinkedIn
- YouTube users watch 4,146,600 videos
- Instagram users post 46,760 photos
- Google processes more than 40,000 searches
- 5 new Facebook profiles are created
We are not our social profiles, and we are definitely not our search history; those are just small, albeit marketable, parts of the whole. While digital identities help businesses target individuals more efficiently, they don’t help us extend our reach, or rather, interact in a truly globalized economy. Our so-called “digital identities” within these siloed frameworks and contexts act as distinct and isolated digital profiles that are not portable to other ecosystems; we have no ability to consolidate our digital engagement to create accurate depictions of ourselves online. As a result, online representations of ourselves are inaccurate, inauthentic, and flawed to the point where we can’t use them beyond simple purchases, or non-digital tasks, like applying for a real estate loan. This “pulverization”, or distribution of our digital identities, severely limits the potential benefits that data can provide to individuals. Raw data is meaningless, data processed in this siloed or distributed way barely scratches the surface of what can be achieved. Only when data is consolidated and assigned context does it actually become information, and become inherently meaningful to more than just commercial activities.
For example, online interactions with a fashion retailer may hint towards our interests and tastes, and may show how easy or difficult it may be to successfully carry out a conversion. Every online interaction tells a very limited tale, yet these isolated points are jammed together without context to build a persona that speaks to marketing queries.
Unfortunately, while the internet may be open and, for now, out of the hands of controlling interests, data is not. Individuals are the rightful owners of their own data, yet have little say in the development, distribution, and monetization of our data and corresponding digital identities. While GDPR helps correct the imbalance, it remains incomplete since it doesn’t achieve the contextualization that we are referring to above.
To make matters worse, while today individuals are offered ways to use some of their data for very little personal benefit, criminals can hack the organizations that store our data, using it to practically destroy our economic and social lives. Data theft represents a global pandemic and the effects thereof can be catastrophic.
The systems that house, share, and acquire data are siloed, and, as such, highly vulnerable. These silos of data also require individuals to replicate the same piece of personal information several times every year. It’s not hard to see why this system is broken; what is hard to understand is why companies and governments around the world keep depending on the same ineffective centralized and siloed solutions.
As individuals, we have become exploitable data-units that are used by businesses and governments to obtain an economic benefit. It’s truly ironic that individuals are sources of massive amounts of data and corresponding profit, yet can’t benefit from our own data through either accurate digital representation or monetary payment.
A Global Shyft
For all the properties that blockchain technology is said to have, there are some that can truly change the world and improve the lives of billions. At Shyft Network we recognize that the challenge ahead of us is massive, with highly complex incumbent systems in our path that require a paradigm shift to disrupt, but we also believe that blockchain holds the key to a truly better solution for all stakeholders — individuals, enterprises, and governments. We understand this problem to be a global one, which requires a reliable, resilient, and decentralized network of actors, all balanced and kept accountable by blockchain technology.
We believe that the first step to facilitating this shift to a world where data goes to work for individuals and poses less of a risk for businesses is to provide a framework, a blueprint of what the pipeline looks like. We will build upon this framework and put our efforts into enabling actors to join the Shyft Network, understand its potential, and leverage it for the gain of everyone involved.
A Data Supply Chain
The Shyft Network decentralized solution is a supply chain for data sharing. To successfully address the main issues described above, the Shyft system has been designed taking the following as core characteristics:
- Consent framework: A fluid process for organizations to get consent from “data owners” (users and other organizations) before sharing data.
- Non-custodial: Shyft Network never touches or accesses any private data.
- Secure: By using zero-knowledge proofs to issue data attestations, users can securely interact with data consumers without sharing the data itself. Instead, only encrypted tags are shared to prove the existence of trusted-third-party-validated data.
- Optionality: Depending on requirements, organizations can either share and obtain data directly (custodial) or share verifiably-accurate attestations against user data (non-custodial). This grants entities data protection capabilities to fulfill their regulatory requirements and alleviate constraints.
- Cost-effective: Businesses will benefit from: decreased costs of sharing, due diligence on data sharing partners, hacks (fines, user recourse, etc.), and custody; decreased counterparty risk because data is verifiably true; decreased hacking risk; less global replication of data; and decreased quantities of data changing custody.
- Transparency: “Data Owners” get an interface to track who is using their data and how their data is being used.
An Accurate Digital Representation of You
Through attestations of different sets of data, i.e., identity, ownership of assets, etc., a single address may represent a consolidated profile of a single user. Furthermore, attestations are flexible enough to allow a large variety of different validations, thus providing true context. The uses for such context-heavy information are potentially endless; all made easier through the consolidation of digital identities in a user-facing interface and kept accurate by engagement with organizations that already interact with our data today. Not only is Shyft Network increasing the safety of our data, but it also restores data-ownership rights to individuals and development of accurate, aggregated digital identity.
Unlocking the World’s First Data Marketplace
As data changes hands (custodial or non-custodial, in the form of attestations), a marketplace is created where individuals can be rewarded as their data is used commercially. This unlocks economies of trust, in which only those that can and want to compete will be able to do so. Individuals will be able to interact at a truly global scale, without risking their identity and personal information.
Shyft’s Go To Market Strategy
We’re taking an enterprise-first approach, targeting industries where the data is the most valuable, because this is where users are the most vulnerable.
During the first phase of Shyft Network, we’re partnering with:
- Organizations that are regulatorily required to share data
- Organizations that already collect and share sensitive data at massive scale
- 3rd party services that utilize this data to create applications and data-driven use cases
We make it easy for organizations to interact with their users for the first time, increasing global accountability and trust between users and organizations.
We believe with this strategy, Shyft Network becomes valuable to users with each new network partner that joins the network, onboarding their users and adding an identity-touchpoint to each user’s interface.
Shyft’s Initial Use Cases: Global Attestation Layer for VASPs
Under the new FATF guidance section 7B, Virtual Asset Service Providers (VASPs) are regulatorily required to share sender and receiver data for every transaction in and out of their platforms.
VASPs include digital asset exchanges, custodians, and OTC desks, are the central point of user-onboarding in the cryptocurrency ecosystem. Working with VASPs gives Shyft Network access to millions of cryptocurrency users who will be onboarded to the Shyft user-facing portal through these partnerships. For context, a US-based VASP has seen 8 million new users sign up in 2019 alone, bringing their total user base to 30 million since 2012.
VASPs have strict KYC requirements. They hold a lot of sensitive data pertaining to the identities of their users.
Impossible to create an audit trail
When a VASP user executes a transaction leaving VASP 1 and heading to VASP 2, VASP 1 has no way to tell where the transaction is headed, or any data around the recipient of the transaction (no chain-of-custody), making compliance impossible. This problem is compounded by users having no insight into which exchanges are custodying their private identity data, or to consent to this data being shared.
Shyft Network has partnered with top VASPs to create a system for passporting KYC information across all participants that must comply with global KYC requirements.
Shyft works with VASPs by offering:
- A user-facing interface where users can see which organizations have custody of their data, and consent to sharing their data with new custodians (governments, IRS, VASPs)
- An attestation network / a global whitelist of exchange addresses, allowing VASPs to share user identity data
- The ability to query within the VASP Federated Coalition to see if any VASP is custodying identity data of a specific user, for no cost
- Increased ease of 7B compliance
- Increased global accountability and trust between VASPs and users
Shyft’s Initial Use Cases: Digital Identity
Jurisdictions are looking for transformative solutions that will provide a more secure and efficient way to manage and share citizen data within a consent-based framework.
Governments recognize that their citizens don’t have consolidated digital identities that include:
- Identity data
- Financial records
- Health and Education records
- Telecom records
- Transit records
- Property records
- Credential validation
- Voter authentication
This makes governance activities harder:
- Tax collection and tax evasion control
- Application of social programs
- Macro and micro management of public resources
- Law and policy enforcement
- Assessment and policy evaluation
- Fraud prevention
And means that people without a valid ID are faced with hardships:
- 1.1 billion “invisible people” globally without ID are precluded from essential life services (i.e. schooling, healthcare, right to vote, etc…)
- Paper-based identity is laden with fraud and scalability problems
- Developing verifiably-accurate credit at an individual level is a global issue for 3.5 billion people that are either “under” or “unbanked”
Data sensitivity and lack of audit trail:
There are strict compliance regulations around the sharing, collection and storage of sensitive data, such as identity data. Governments want transparency and certainty around chain-of-custody.
Shyft Network works with governments by offering:
- A user-facing interface where citizens can leverage organizations having custody of their data and consent to borderless data-sharing with new custodians (governmental organizations, banks, healthcare providers, telecoms) bringing better security, interoperability and efficiencies to legacy services
- An attestation network allowing for trusted data sharing with full transparency and auditability for governments
We’re excited to launch Shyft Network with two major use cases that we believe are perfectly aligned with our team’s vision, and our technology’s capabilities.
Currently we see these as the most achievable milestones ahead. We will continue to integrate more changes as the community of Shyft takes control of this path in the fourth quarter of 2019.
As we build systems that provide individuals with more freedom and choice, we hope to see evolution perpetuate and accelerate revolution. In order to ensure that the crypto revolution is built on the lessons of the past, and the ideas of the future, Shyft’s contributors will continue to build bridges between these networks and ideologies. Shyft represents a change in the way we communicate as a global village in the modern world, and as a fabric for how humanity and citizenship 3.0 can begin to redesign itself.
Sincerely Your Soldiers,
Shyft Network aggregates trust and contextualizes data to build an authentic reputation, identity, and creditability framework for individuals and enterprises.
Join our Telegram (https://t.me/shyftnetwork)
Follow us on Twitter (https://twitter.com/shyftnetwork)
Check out our GitHub (https://github.com/ShyftNetwork)
Other channels (https://www.shyft.network)