Facebook’s blockchain move raises eyebrows


“A lot of us got into technology because we believe it can be a decentralising force that puts more power in people’s hands,” Mark Zuckerberg wrote in his New Year message to his Facebook followers.

The Facebook founder was lamenting how, with the rise of a small number of big tech companies — not least his own — many people believe technology only centralises power, rather than decentralises it.

The remarks were largely read at the time as a riff on the political controversies engulfing his social network, but Mr Zuckerberg also vowed to explore “counter-trends” to centralisation, such as encryption and cryptocurrency.

A few months later, that exploration appears to have stepped up a gear. Mr Zuckerberg last week appointed one of his most senior lieutenants, David Marcus, to head a new team to experiment with blockchain, the decentralised digital ledger technology that is exciting everyone from start-ups to big banks.

Blockchain promises a new way to record transactions, including the transfer of cryptocurrency and other digital assets, without having to go through a central authority, such as Facebook’s own servers.

What the company has not done is say anything, in public at least, about what Mr Marcus and his team will be doing — leaving others in the blockchain world to speculate, and poring over Mr Marcus’s resume for clues. The 45-year-old executive has been given his new assignment after a stint in charge of Facebook Messenger. Before Facebook, he was president of PayPal, the online payments company, and he also sits on the board of Coinbase, a US cryptocurrency exchange.

Facebook could use the technology for payments on the social network, by creating its own cryptocurrency, blockchain experts say. It could use it to try to improve privacy, by giving users a new way to own and control their personal data. Or it might think blockchain will help it fight fake accounts and provide more services by giving users a way to prove their identities.

One particular threat of blockchain to Facebook could come from people building a decentralised alternative that rewards users with a new cryptocurrency for posting on their platform.

“You’ll learn a lot about what Facebook is by what they think they are going to do with some of these technologies,” said Brewster Kahle, a digital librarian and activist trying to help build a decentralised web.

Facebook first dabbled in blockchain research led by Morgan Beller, a corporate development executive, last year.

The exploration of blockchain is about more than satisfying Mr Zuckerberg’s curiosity, or returning to his youthful dreams of giving power to the people. Facebook has long been focused on potential competitive threats, even very long-term ones, and has often moved quickly to squash them.

In the case of Instagram and WhatsApp, it bought the competition. It copied hashtags and public posts from Twitter and the “Stories” photo collection format from Snap. Blockchain cannot be bought but it can be harnessed, and Facebook may be investing in research in case a competitor uses the technology to become a threat.

Spencer Bogart, a partner at Blockchain Capital, which invests in blockchain companies and cryptocurrencies, predicted Mr Zuckerberg will want to make sure he is prepared for competition even if “there might not be an obvious and immediate slam dunk for Facebook in the space”.

And competitors do seem to be moving.

Telegram, the encrypted messaging app with 170m users — a rival to Facebook’s WhatsApp — recently raised $1.7bn through the sale of its own cryptocurrency. Telegram says it is planning to build its own blockchain.

Mr Bogart said the sale “clearly stirred waves” at Facebook, pushing them to invest more heavily.

There are other social apps exploring blockchain, too, including Kik, an ad-free messaging app. It launched its own digital token and said it started work on a blockchain-based payments system last year. Steemit, a social media platform, pays users in a cryptocurrency called Steem to produce content.

It remains unclear if any of these blockchain or cryptocurrency projects will bear fruit for Facebook’s rivals, but Sheila Warren, head of blockchain at the World Economic Forum, said she thought starting a lab to investigate blockchain was a “really smart move” for Facebook.

She said the company could look at creating a coin that would allow “micropayments” on the site, which could lead to an “explosion of applications”. Some publishers who feel that Facebook profits unfairly from their stories might welcome a way to charge readers.

In the wake of revelations that Cambridge Analytica improperly obtained the personal data of up to 87m Facebook users, the social network could also consider blockchain as a way to give uneasy users more control over their data.

A different social network that is able to help people control their data may grow into a significant threat to Facebook, Ms Warren said. “One of the things blockchain is good at doing is creating trust where trust doesn’t exist.”

Blockchain could be used to create smart contracts around who can receive personal information over the Facebook platform. “You set the permissions in such a way that if you say for cat videos, you can take all my data, but for music videos, you can only take my screen name, it is self-executed automatically,” Ms Warren explained.

Facebook could also zero in on how to prove your identity online, using blockchain for a public key to match your private information.

This is a function that would be useful for today’s social network where people are still able to spread hate speech and engage in terrorist recruitment.

Detractors point out that Facebook has so far been the opposite of a decentralised network implied by blockchain. It has 25,000 employees, mostly in California, creating one set of policies and one bank of data for more than 2.2bn monthly active users across the world. In response to controversies about the content on its site, it is taking an even more activist approach to what is, and is not, allowed to appear there.

“Facebook being a hyper centralised entity, I’m interested to see how that fits with the philosophy of decentralisation” which underpins blockchain, said Tanner Philp, director of corporate development at Kik.

Eyal Hertzog, co-founder of Bancor Network, a blockchain start-up that specialises in digital currency conversions, thinks there is more danger than opportunity in Facebook’s experiment with blockchain.

“Facebook’s power is tied to its centralised database of user content and connections,” he said. “If this becomes decentralised as they access blockchain, Facebook will also lose its grip on users.”


Be the first to comment

Leave a Reply

Your email address will not be published.


*


Privacy Policy

WideBitcoin.com is committed to safeguarding your privacy. Contact us at if you have any questions or problems regarding the use of your Personal Data and we will gladly assist you.

By using this site or/and our services, you consent to the Processing of your Personal Data as described in this Privacy Policy.

Table of Contents

  1. Definitions used in this Policy
  2. Data protection principles we follow
  3. What rights do you have regarding your Personal Data
  4. What Personal Data we gather about you
  5. How we use your Personal Data
  6. Who else has access to your Personal Data
  7. How we secure your data
  8. Information about cookies
  9. Contact information

Definitions

Personal Data – any information relating to an identified or identifiable natural person.
Processing – any operation or set of operations which is performed on Personal Data or on sets of Personal Data.
Data subject – a natural person whose Personal Data is being Processed.
Child – a natural person under 16 years of age.
We/us (either capitalized or not)

Data Protection Principles

We promise to follow the following data protection principles:

  • Processing is lawful, fair, transparent. Our Processing activities have lawful grounds. We always consider your rights before Processing Personal Data. We will provide you information regarding Processing upon request.
  • Processing is limited to the purpose. Our Processing activities fit the purpose for which Personal Data was gathered.
  • Processing is done with minimal data. We only gather and Process the minimal amount of Personal Data required for any purpose.
  • Processing is limited with a time period. We will not store your personal data for longer than needed.
  • We will do our best to ensure the accuracy of data.
  • We will do our best to ensure the integrity and confidentiality of data.

Data Subject’s rights

The Data Subject has the following rights:

  1. Right to information – meaning you have to right to know whether your Personal Data is being processed; what data is gathered, from where it is obtained and why and by whom it is processed.
  2. Right to access – meaning you have the right to access the data collected from/about you. This includes your right to request and obtain a copy of your Personal Data gathered.
  3. Right to rectification – meaning you have the right to request rectification or erasure of your Personal Data that is inaccurate or incomplete.
  4. Right to erasure – meaning in certain circumstances you can request for your Personal Data to be erased from our records.
  5. Right to restrict processing – meaning where certain conditions apply, you have the right to restrict the Processing of your Personal Data.
  6. Right to object to processing – meaning in certain cases you have the right to object to Processing of your Personal Data, for example in the case of direct marketing.
  7. Right to object to automated Processing – meaning you have the right to object to automated Processing, including profiling; and not to be subject to a decision based solely on automated Processing. This right you can exercise whenever there is an outcome of the profiling that produces legal effects concerning or significantly affecting you.
  8. Right to data portability – you have the right to obtain your Personal Data in a machine-readable format or if it is feasible, as a direct transfer from one Processor to another.
  9. Right to lodge a complaint – in the event that we refuse your request under the Rights of Access, we will provide you with a reason as to why. If you are not satisfied with the way your request has been handled please contact us.
  10. Right for the help of supervisory authority – meaning you have the right for the help of a supervisory authority and the right for other legal remedies such as claiming damages.
  11. Right to withdraw consent – you have the right withdraw any given consent for Processing of your Personal Data.

Data we gather

Information you have provided us with
This might be your e-mail address, name, billing address, home address etc – mainly information that is necessary for delivering you a product/service or to enhance your customer experience with us. We save the information you provide us with in order for you to comment or perform other activities on the website. This information includes, for example, your name and e-mail address.

Information automatically collected about you
This includes information that is automatically stored by cookies and other session tools. For example, your shopping cart information, your IP address, your shopping history (if there is any) etc. This information is used to improve your customer experience. When you use our services or look at the contents of our website, your activities may be logged.

Information from our partners
We gather information from our trusted partners with confirmation that they have legal grounds to share that information with us. This is either information you have provided them directly with or that they have gathered about you on other legal grounds. See the list of our partners here.

Publicly available information
We might gather information about you that is publicly available.

How we use your Personal Data

We use your Personal Data in order to:

  • provide our service to you. This includes for example registering your account; providing you with other products and services that you have requested; providing you with promotional items at your request and communicating with you in relation to those products and services; communicating and interacting with you; and notifying you of changes to any services.
  • enhance your customer experience;
  • fulfil an obligation under law or contract;

We use your Personal Data on legitimate grounds and/or with your Consent.

On the grounds of entering into a contract or fulfilling contractual obligations, we Process your Personal Data for the following purposes:

  • to identify you;
  • to provide you a service or to send/offer you a product;
  • to communicate either for sales or invoicing;

On the ground of legitimate interest, we Process your Personal Data for the following purposes:

  • to send you personalized offers* (from us and/or our carefully selected partners);
  • to administer and analyse our client base (purchasing behaviour and history) in order to improve the quality, variety, and availability of products/ services offered/provided;
  • to conduct questionnaires concerning client satisfaction;

As long as you have not informed us otherwise, we consider offering you products/services that are similar or same to your purchasing history/browsing behaviour to be our legitimate interest.

With your consent we Process your Personal Data for the following purposes:

  • to send you newsletters and campaign offers (from us and/or our carefully selected partners);
  • for other purposes we have asked your consent for;

We Process your Personal Data in order to fulfil obligation rising from law and/or use your Personal Data for options provided by law. We reserve the right to anonymise Personal Data gathered and to use any such data. We will use data outside the scope of this Policy only when it is anonymised. We save your billing information and other information gathered about you for as long as needed for accounting purposes or other obligations deriving from law, but not longer than 1 year.

We might process your Personal Data for additional purposes that are not mentioned here, but are compatible with the original purpose for which the data was gathered. To do this, we will ensure that:

  • the link between purposes, context and nature of Personal Data is suitable for further Processing;
  • the further Processing would not harm your interests and
  • there would be appropriate safeguard for Processing.

We will inform you of any further Processing and purposes.

Who else can access your Personal Data

We do not share your Personal Data with strangers. Personal Data about you is in some cases provided to our trusted partners in order to either make providing the service to you possible or to enhance your customer experience. We share your data with:

Our processing partners:

  • facebook.com
  • google.com
  • bing.com
  • twitter.com
  • pinterest.com

Our business partners:

  • facebook.com
  • google.com
  • bing.com
  • twitter.com
  • pinterest.com

Connected third parties:

  • facebook.com
  • google.com
  • bing.com
  • twitter.com
  • pinterest.com

We only work with Processing partners who are able to ensure adequate level of protection to your Personal Data. We disclose your Personal Data to third parties or public officials when we are legally obliged to do so. We might disclose your Personal Data to third parties if you have consented to it or if there are other legal grounds for it.

How we secure your data

We do our best to keep your Personal Data safe. We use safe protocols for communication and transferring data (such as HTTPS). We use anonymising and pseudonymising where suitable. We monitor our systems for possible vulnerabilities and attacks.

Even though we try our best we can not guarantee the security of information. However, we promise to notify suitable authorities of data breaches. We will also notify you if there is a threat to your rights or interests. We will do everything we reasonably can to prevent security breaches and to assist authorities should any breaches occur.

If you have an account with us, note that you have to keep your username and password secret.

Children

We do not intend to collect or knowingly collect information from children. We do not target children with our services.

Cookies and other technologies we use

We use cookies and/or similar technologies to analyse customer behaviour, administer the website, track users’ movements, and to collect information about users. This is done in order to personalize and enhance your experience with us.

A cookie is a tiny text file stored on your computer. Cookies store information that is used to help make sites work. Only we can access the cookies created by our website. You can control your cookies at the browser level. Choosing to disable cookies may hinder your use of certain functions.

We use cookies for the following purposes:

  • Necessary cookies – these cookies are required for you to be able to use some important features on our website, such as logging in. These cookies don’t collect any personal information.
  • Functionality cookies – these cookies provide functionality that makes using our service more convenient and makes providing more personalised features possible. For example, they might remember your name and e-mail in comment forms so you don’t have to re-enter this information next time when commenting.
  • Analytics cookies – these cookies are used to track the use and performance of our website and services
  • Advertising cookies – these cookies are used to deliver advertisements that are relevant to you and to your interests. In addition, they are used to limit the number of times you see an advertisement. They are usually placed to the website by advertising networks with the website operator’s permission. These cookies remember that you have visited a website and this information is shared with other organisations such as advertisers. Often targeting or advertising cookies will be linked to site functionality provided by the other organisation.

You can remove cookies stored in your computer via your browser settings. Alternatively, you can control some 3rd party cookies by using a privacy enhancement platform such as optout.aboutads.info or youronlinechoices.com. For more information about cookies, visit allaboutcookies.org.

We use Google Analytics to measure traffic on our website. Google has their own Privacy Policy which you can review here. If you’d like to opt out of tracking by Google Analytics, visit the Google Analytics opt-out page.

Read more about cookies on our Cookie Policy

Contact Information

email: contact@widebitcoin.com

Changes to this Privacy Policy

We reserve the right to make change to this Privacy Policy.

You can configure your Internet browser, by changing its options, to stop accepting cookies completely or to prompt you before accepting a cookie from the website you visit. If you do not accept cookies, however, you may not be able to use all portions of the WideBitcoin Websites or all functionality of the Services.

Please note that disabling these technologies may interfere with the performance and features of the Services.

You may also disable cookies on the WideBitcoin Sites by modifying your settings here:

Visitor comments may be checked through an automated spam detection service.

Last Update: May 25, 2018