Blockchain and data privacy: a challenge for the future
Blockchain, a cutting-edge technology, has brought significant innovations across various sectors. However, its interaction with data privacy raises complex issues, especially in light of the GDPR (General Data Protection Regulation).
Blockchain functions as an immutable and secure data ledger thanks to cryptography. Yet, this transparency is in tension with the GDPR, which sets limits on the retention of personal data. Unlike traditional conventions, the blockchain is designed to maintain data permanently. Nonetheless, the French Data Protection Authority has demonstrated that, through innovative technical solutions, it is possible to align blockchain with data protection regulations.
To understand how to safeguard data privacy within the blockchain, it is essential to define the role of the data controller. This entity can be a legal entity or an individual managing personal data as part of their activity. Miners, who validate transactions, are not considered as such, nor are private users who use cryptocurrencies for personal purposes.
In some cases, blockchain users act as data processors, managing data on behalf of the controller. For example, a software developer creating a smart contract application for an insurance company processes data on behalf of the company, but control remains in the hands of the company.
To overcome the problem of permanent data storage in the blockchain, various technical solutions have been developed. One of these is “commitment,” a complex cryptographic mechanism that ensures data immutability without revealing the identities of the individuals involved. Another strategy is the use of “hashing” of data, which converts information into a fixed-length encrypted string, preventing the reconstruction of the original data.
The GDPR grants individuals significant rights over their data, such as the right to erasure (or “right to be forgotten”) and the right to rectification. In the immutable structure of the blockchain, the application of these rights presents challenges. However, measures can be adopted, such as the use of advanced cryptographic tools to make data inaccessible, simulating the effect of deletion. For the right to rectification, a new transaction can be inserted that neutralizes or invalidates the previous one.
Takamaka: Innovation and Privacy in Blockchain
Takamaka stands out as an innovative solution in the blockchain landscape. It uses PoS as a consensus algorithm to timestamp information related to transactions. This system allows for the uploading of data, from financial details to file information, while offering privacy through the transaction of a hash ID. Another method is the aggregation of data into a block, followed by extraction and transfer of the hash onto the blockchain. These approaches ensure data protection and reduce transaction costs.
Takamaka’s model, which allows for the transaction of the hash on the blockchain, offers clarity on costs, facilitating expense planning. This method not only solves the problem of privacy on the blockchain but also strengthens user trust, encouraging broader and more conscious use of this technology.
While blockchain offers advantages in terms of security and transparency, it is crucial to protect the privacy of personal data. The cryptographic solutions and various measures described are fundamental steps towards this goal.
Takamaka is redefining privacy standards in blockchain, paving the way for a future where blockchain technology is used more securely and consciously.
Visit www.takamaka.io
