As Mark Zuckerberg appeared before the US Senate, Jason Potts and colleagues from RMIT were proposing a very different take on the damage badly regulated big data can do, pointing to unintended possible consequences from the EU’s General Data Protection Regulation. The RMIT team suggest that in attempting to protect peoples’ privacy the EU will devalue data already collected by firms and sold to third parties, who will need consent to use it. “This will create a secondary market in insurance contracts that pay out if data cannot be used. Collateralised Data Obligations (CDO) may also emerge, with data ‘originators’ packaging personal data into tranches of varying risk of consent withdrawal.” Sounds ridiculous? So did the packaged housing debt that started the 2008 US financial crisis which was brought on in-part by poorly designed regulation. “Government intervention into what are deemed to be instances of market failure often has unintended (but foreseeable) consequences when rational market agents endeavour to offset the additional risks or costs the regulatory intervention imposes,” the RMITers remark.
So, is there nothing that can save us from the irresistible force of the state and immutable objects of markets’ will to profit? Funny you should ask that, because the authors, all from the RMIT Blockchain Innovation Hub have an idea;
“Other solutions allowing data protections and addressing privacy concerns should be examined, including the use of technology to allow data subjects greater control over how they disseminate personal information. Research into the concept of self-sovereign identity, and the use of blockchain and distributed ledger technology is one such promising avenue.”
Researchers across the country are researching the blockchain as technology and financial exchange but Professor Potts and colleagues are leaders in analysing its potential to transform the way society is organised.