“At its highest level, blockchain is a trust layer.”
In nine words, Kaleido Insights founding partner Jessica Groopman succinctly summarized the gist of CDX Academy’s “Blockchain Brand Innovation Summit” on May 11 during her opening remarks.
The summit itself brought together representatives from blockchain startups and incumbent institutions to debate and discuss different use cases for the technology, noting both its advantages and its flaws.
According to various panels, the obvious use for blockchain is in data storage, whether in healthcare or in other private, consumer data. The overreach of many centralized institutions as it relates to personal data, in particular, has made headlines recently, perhaps the most notable being third-party application’s collection of Facebook users’ private information.
Speaking on a panel to the Facebook scandal, Christiana Cacciapuoti, vice president of partnerships and platform operations at Mad Hive said:
I do see a fundamental shift, and especially with Facebook’s [recent disclosures], I think the average consumer is now more aware of how pervasive data collection is.”
Jeremy Balkin, head of U.S. innovation at HSBC Bank, echoed that, saying, blockchain adoption, in general, is being sped up by a lack of faith in existing systems.
Unlike Cacciapuoti who spoke to today’s social media platforms, Balkin pointed to financial systems as an example, where people – in particular, millennials – are looking to the nascent technology as a way to protect their privacy and security.
But it’s not just individuals that are hoping the technology provides a better security architecture for their digital lives, but also large corporates.
Gil Beyda, managing director at Comcast Ventures, said the telecommunications giant is looking into using distributed ledger technology for increased security, not only in preventing networks from being compromised but also in compartmentalizing the potential damage if a system is compromised.
That said, many of the panelists were cautious about how far blockchain really goes to secure systems – at least at present.
For instance, McAfee chief consumer security evangelist Gary Davis warned that blockchain technology has a major flaw: though blockchain itself may be a secure technology, it is surrounded by security holes.
“It rides on the internet, so by definition you’re putting a technology on something that is proven to be very vulnerable, very prone to attack,” he said.
He pointed to the recent MyEtherWallet hack, whereby attackers were able to drain $150,000 worth of users’ ether through a vulnerability in the domain name servers the wallet was using.
On top of that, while many see the immutability of blockchains as an advantage, Comcast Venture’s Beyda said that feature could become a major issue for people who store their identity or financial information on a platform.
“[Right now] it’s inconvenient if our identity is stolen, if our credit card is stolen, but we have mechanisms to recover that,” he said. “If you have a public-private key pair, and you lose that, it’s gone … if you have a private key, you have access to all of the resources.”
As such, he continued, “The first level of attack is not trying to crack the public-private keys, but to steal the private keys.”
Still, Beyda remained hopeful, saying the industry must be patient as the technologists “catch up” with business needs.
Blockchain is an amazing technology, and I believe it has the promise to disrupt some existing businesses.”