How Blockchain Can Help You Earn On Your Data, Explained

Many tech giants make millions out of their customers’ data, but Blockchain could enable this revenue to go to the users themselves.

What is personal data?

Personal data is tricky to define sometimes, but at its most basic level, its information which can identify a person either directly or indirectly.

One of the most significant laws governing privacy is the General Data Protection Regulation, which goes into force across the European Union on May 25th.

According to the European Commission, examples of your personal data include your name, where you live, your email address, location records gathered by your mobile phone, your IP address and medical history.

Even if your details have gone through an anonymization process, it still counts as personal data if the pseudonyms or encryption used can still result in you being identified.

What do social media companies do with my data?

This depends on their data use and privacy policies. Thankfully, many companies are starting to realize they need to become more transparent.

Up until now, users of the biggest social networks have been expected to read thousands of words to understand how their data is used. And, let’s all be honest now, we don’t always read the terms and conditions we agree to.

For example, if you request to download all of the data that Facebook has on you, it’s likely to include your entire history of messages, and a full list of your mobile phone contacts. The items that come up prominently in your News Feed are often based on the things you have liked and commented on in the past.

Staying logged into a social network can mean it can see practically all of the other sites you visit and this information is sometimes used to serve up adverts you might be interested in. Some companies also aggregate your data so advertisers can reach very specific demographics, such as a 30-something male, living in New York, who owns a dog and likes burgers.

Public awareness about the use of private data by social networks has been heightened by the recent scandal engulfing Facebook. Cambridge Analytica, a data analytics company, allegedly harvested personal data from at least 50 mln Facebook profiles without consent developing an algorithm that targeted voters during the US election.

Is my data valuable to them?

For certain companies, Google, LinkedIn and Facebook as prominent examples, your personal data is extremely valuable.

Advertising represents a significant chunk of their annual revenues, with both companies becoming giants in this sector. Although many of their services are free at the point of use, the trade off is that the data gleaned from your online habits can be used to attract advertisers.

However, your personal data can prove profitable in other ways. For example, if you are a high-flying professional who has registered with a recruitment site, this company could make other users pay for access to your contact details and your full profile.

Can I profit from the data I give to social networks?

Blockchain has the potential to give the public greater control over their personal data and help them earn money whenever their information is used.

By using decentralized systems, people have the potential to decide who can obtain their information, and how much it is worth.

This exchange of data would normally be facilitated by the company running the Blockchain platform and in many cases, they will only take a small fee at the end of every transaction.

How would that work?

This would depend on the type of personal data you’re willing to sell, and the type of business that’s looking to purchase it.

For example, you might be able to bring together your social network profiles on a Blockchain-powered data exchange and opt into a scheme where you are rewarded when this information is shared with companies.

In other cases, such as a professional network or a freelancer marketplace, a business would search massive data sets for profiles that meet their requirements – and then pay a fee through a smart contract.

How much can I earn… and how would I be paid?

In many cases, this would be down to you.

Some Blockchain-based platform will allow you to set the price others must pay to see your personal data. However, it’s worth remembering that this information is only going to be valuable if it isn’t easy to access on your website or elsewhere online.

You might get paid in tokens which can then be used to purchase other services on the same platform or converted into other cryptocurrencies and fiat.

In other cases, you might be rewarded by different means. For example, allowing access to your personal data may help you gain cashback or generous discounts when purchasing items online.

Who is going to pay for my data?

For a start, companies trying to advertise their products ethically may prefer to use this system over one that captures data en masse without a person’s knowledge.

Some businesses and individuals might like to buy data because it allows them to be more specific with the people they are targeting. Plus, it prevents them from wasting money on reaching consumers who will never be interested in what they have to say.

In addition, because you have control over your data, the information you’re offering is much more likely to be accurate. Oftentimes, advertisers are working off “inferred data,” where conclusions are drawn based on the information you have given voluntarily and the data gathered automatically through your online activity. Incorrect conclusions would be more preventable if you knew the information being disseminated in advance.

One example of a Blockchain platform where you can be paid for your data is Profede. This company offers a protocol where businesses can search for talented professionals who match their requirements. And, whenever a business wants to access someone’s personal data to get in touch, it is the professional themselves, not a middleman, who gets the reward.