Blockchain technologies will ignite the era of decentralization, where customers own their data and decide how it is used. IT leaders should start to rethink their strategies.
Blockchain has introduced alternative methods for tracking and managing customer data. IT leaders need to understand the direction of decentralized technologies — or risk falling behind.
Scan the latest news: Many tech sector reports mention the misuse of data and the erosion of privacy. Among the disconcerting newsflashes are also new terms such as “surveillance economy,” where customers sacrifice data privacy for “free” services. In an effort to combat such erosion, pieces of legislation like the California Consumer Privacy Act give consumers the right to learn what data companies are collecting about them and demand they not sell it.
Technology solutions, like advancements in blockchain, are less often discussed but perhaps even more seismic.
As Gartner defines it, “Blockchain is an expanding list of cryptographically signed, irrevocable transactional records shared by all participants in a network.”
Because these time-stamped records are decentralized and immediately duplicated across all participating parties, blockchain is exponentially more difficult to hack. Blockchain is also more transparent: Anyone with access rights can learn about a transactional event at any point in its history.
For businesses, the centralization of customer data poses a risk from a security and single-point-of-failure standpoint. Centralization also represents a restriction on new business models and customer dynamics.
Blockchain — because it ensures the immutability of records and makes records traceable without the need for a centralized authority — can introduce alternative methods for tracking and managing specific customer data. This is especially true when the cost of adding data sources, and the increased liabilities that come with it, exceed the benefits. Considering the exponential growth of customer data usage of emerging technologies such as AI and IoT, all of this becomes extremely relevant to customers.
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