As technology grows, parallelly the privacy concerns over them also grow. It is important to secure data privacy since it impacts the users if it gets breached. Reportedly blockchain faced a lot of data breach incidents and it is time to mitigate them.
Blockchain
In 2008, blockchain technology was developed. It is a distributed database or ledger shared among a computer network’s nodes. They were initially developed as a cryptocurrency technology. They play a crucial role in cryptocurrency by maintaining a secure and decentralized record of transactions. Blockchain technology has greatly evolved from initial cryptocurrency to smart contracts. They are not only limited to cryptocurrencies, many industries are benefitted by using this blockchain technology. Many industries face blockchain security issues that question the security of blockchain it is important to mitigate them to reduce further risks and ensure security.
Types of blockchain
Permissionless and permissioned blockchains are the types of blockchains.The permissionless blockchain is with no restrictions on participation and permissioned blockchain with restrictions on participation. There are private keys and public keys that are used in blockchain, where the private keys are used in private for authentication and encryption. The public key is publicly known and is used for identification.
The Public blockchain falls under the category of permissionless blockchain with no central authority. The Private and Consortium blockchain falls under the category of permissioned blockchain where they are controlled by one authority and by a group respectively. The Hybrid blockchain falls under the category of both permissionless and permissioned blockchain.
Applications of blockchain
The following are the applications of blockchain, which include,
- Smart contract development
- Asset registers
- Supply chain management
- Record keeping tools
Their application is seen in various industries such as fintech, real estate, healthcare, and retail.
Blockchain privacy issues and challenges
Even though blockchain has various advantages, it also has challenges that are associated. The following are some of the privacy and technology challenges in blockchain.
Data Privacy: Considering blockchain, there exists a concern about data privacy reason which anyone can see and retrieve data in transactions.
Scalability: Scalability can become a constraint when implementing blockchain, mostly due to block size and response times. In this technology, every node stores, processes, and maintains transactions in a block to ensure security and privacy. But as the number of transactions increases, small and medium-sized businesses struggle to accommodate a growing number of transactions in a block. Those increases can also slow the validation process
Regulations: With the emerging regulations organizations are finding it difficult to comply with the evolving data privacy laws and regulations. The right to be forgotten, as stated in the General Data Protection Regulation (GDPR) is difficult to implement as blockchain prevents the parties from modifying or deleting the data, which results in violating the government rules.
Blockchain and GDPR
General Data Protection Regulation (GDPR) was introduced by the European Union in 2018 which protects the data of European data subjects. In blockchain personal data and transaction history are being stored, this falls under the purview of GDPR. Since GDPR deals with the protection of personal data. so there exists a relationship between blockchain GDPR in the case of privacy.
Europe’s General Data Protection Regulation (GDPR) and similar laws allow individuals to demand that their data be deleted; these laws also create a “right to be forgotten” in certain cases. Since blockchain prevents parties from modifying or deleting data, the technology risks violating government rules.
In the case of Blockchain the “right to rectification” is also something challenging, where the data in the blockchain is immutable. So they cannot be modified or deleted.
With regard to the GDPR principles, blockchain consent management is difficult to implement.
As a result, permissioned blockchain can be adapted for supporting the governance models, since permisionless blockchain possesses a great risk.
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