by Jonathan Fry
The recent challenges Facebook have been experiencing using our personal data are not unique to them, but they do raise the issue as to who controls our data, how is it used, and to whom it is being sold.
Companies make assumptions about our spending patterns and risk ratings. While it is now illegal, for years insurance companies rated lady drivers as lower risk and charged smaller premiums. What people are less aware of is your car insurance price can be effected by your email. A recent article by The Sun newspaper in the UK stated that if you had a Hotmail address, your car insurance premiums would be higher. When The Sun challenged the insurance companies they said that historically it was younger people who had Hotmail email addresses. More worrying is that some insurance companies will alter your premium based on you name and will, for example, quote higher premiums if your surname is Mohammed.
Facebook, it seems, have sold data to Cambridge Analytics, the same company that worked with Trump, helping him to become the most powerful man in the world. Allegedly, it improperly obtained information on 50 million Facebook users. For years companies like Facebook and Google have been giving free access to its service to gather data and then resell this data to the highest buyer. It was estimated that in 2016 Facebook was making over $4 from each person who had an account with them, and their model of collecting and selling data has made them one of the biggest companies in the world. Google, meanwhile, seem to be making more than double this ie $10 per registered user on Google.
How can tokenomics help?
To buy and sell tokens you typically need a wallet, whether it be to participate in a firm that wishes to raise capital via an ICO, or to use the tokens from one of the many Air Drops. A wallet can either be a ‘hot wallet’ connected to the internet and potentially open to hacking, or a ‘cold wallet’ which is like a USB stick and only connected and vulnerable when you plug it in to a device that connects you to the internet. There are now over 21 million wallets that hold tokens globally and CNN are predicting that by 2024 there could be over 200 million people holding wallets. One of the other advantages of a wallet is that it potentially gives owners control over their data, enabling them to share it with whom they want, and even be paid for doing so. It will, in time, allow one to vote or change bank account provider or utility provider more efficiently and quickly.
One of the largest and most highly-publicized recent token sales by Telegram (the social media messaging firm), which has just announced that it has over 200 million subscribers on its platform. So, little wonder that Facebook has banned adverts about Telegram’s ICO on its website.
Telegram announced it was going to launch an ICO and issue TON Tokens to help fuel its global expansion, potentially raising over $14.7 billion. Clearly with a pile of cash and the fact that it is reportedly already handling over 50 billion messages a day, Telegram could be a threat to other social media players like Facebook and WhatsApp. Its website states “No” when asked: “Will you have ads? Or sell my data?” Could Telegram do to Facebook what Google did to Yahoo?