It’s been over a year since COVID-19 appeared, and it’s still painfully apparent that this crisis is far from over. In fact, it may even trigger the largest economic change since World War Two.
According to Arthur D. Little, a management consultancy firm, COVID-19 has been the impetus for an economic shift from a resources-driven to technology-focused economic model, one where the principles of “green” and tech go hand-in-hand.
In essence, it will be data, not natural resources, which plays the fundamental role in keeping the global economy running. One possible implication of this is a full-scale transition to a digital economy. Data will be the fuel which powers our lives – and emerging technologies like the Internet of Things (IoT) and smart technologies will have to hit the ground running.
Having accepted this revolutionary but inevitable change, it will be more vital than ever to keep personal data safe from malware, cybertheft, ransomware, and all other security threats that have become pervasive during COVID-19. Unfortunately, as sad experience shows, data breaches were not uncommon even pre-pandemic.
Among the deluge of recent cases, the one that proved landscape-changing was the Cambridge Analytica scandal – not only because it vividly exposed unauthorized use of data by Facebook, but because it triggered a chain reaction of privacy regulations across the world, the most infamous of which is the General Data Protection Policy (GDPR). The general notion was that data should be handled more securely, and consumers should have the right to decide for themselves how their data should be handled.
Though it’s been three years since advanced data security practices became infused into the everyday normal, in practice they are rarely effective against metadata attacks — typical encryption practices are no guaranteed safeguard against higher-level cybersecurity menaces.
Desperate times call for desperate measures, and that’s where blockchain, often cited as a crucial element of any future economic system, may play a decisive role in restructuring the global economy. By providing a decentralized, trustless solution, blockchain not only provides a buffer against data security pitfalls by guaranteeing unparalleled data security, it also discards the flawed data flows that have threatened to grind to a halt throughout the pandemic. Further properties such as scalability and full accessibility from any point of earth, bolster confidence that this technology will underpin the new era of data management.
Binance, the world’s #1 crypto-exchange by volume, would doubtless agree with this vision of a blockchain-based future for data privacy. Realizing that the howl for strengthening data privacy can no longer go unheard, with the help of Binance Labs, its right-hand responsible for innovation, it kicked off a recent investment cycle with a data security project called HOPR.
HOPR stands at the forefront of Web3 blockchain-led internet transformation, a network-level infrastructure project pledging to return data control back to users, while at the same time providing a previously unattainable level of metadata security. Thus, HOPR hopes to provide a bridge to the next-stage tech economy, where the disadvantages of corporate-led Web 2.0 and its infamous data privacy leaks will be replaced by next-generation blockchain-driven solutions.
Much more than that, HOPR is also a peer-to-peer network which plans to entrust the reins of decision-making to its community, via the decentralized HOPR Association. In exchange for running nodes in the global HOPR mixnet which provides metadata-secure data transfer (a process dubbed as “hopping”), every user can earn rewards in the platform’s native cryptocurrency, the HOPR token. The HOPR network consists of the message layer, which enables safe and private communication through metadata-secure pathways, and the payment layer which provides staking and network rewards for HOPR token holders.
A privacy-based solution in a similar vein to VPNs, HOPR brings a long-sought-after element of decentralization that promises to become the cornerstone of the new data economy, laying the groundwork for the future developments in the field.
Seizing the opportunity to interview Dr Sebastian Bürgel, Founder of HOPR, I used this chance to find out more about innovation, cybersecurity, data privacy, as well as the fundamentals of the new global data economy.
Andrey Sergeenkov: Hi, many thanks for sparing some time for our conversation. For a warm-up, let’s start with the question – how do you see the evolution of the future trends of the economy? Is it changing for better or worse?
Dr Sebastian Bürgel: Things are challenging right now, but I’m optimistic for the future. Even before the pandemic, people were increasingly dissatisfied with the Web 2.0 model of the internet and the power wielded by monoliths like Google and Facebook.
This dissatisfaction has only accelerated since COVID-19, and we’re seeing a real groundswell of interest in decentralized approaches, from both users and companies. You only have to look at the excitement in the crypto markets during a global recession to see the potential people see there.
Andrey Sergeenkov: What are the most essential qualities for succeeding in this new environment? Is the future fundamentally technology driven, or are there other factors we should consider?
Dr Sebastian Bürgel: If you’re a company, it’s important not to get swept up in all the hype of data being the new oil. Sure, if you’re a huge platform like Google or Facebook, almost all data is inherently valuable to you, and you’ll have the resources to secure it. But if you’re a smaller company, new regulation means data is just as likely to be a liability as an asset. One crucial advantage of a system like HOPR is not just that it gives users greater control of their data, it also lets companies collect only the data they need. Companies who have a robust data policy and who really think hard about what data they do and don’t need to gather are most likely to thrive.
Andrey Sergeenkov: In which ways, primarily, can the data become the currency of the 21st century? In what ways can users capitalize on this — and do you think users themselves will be ever able to tokenize it?
Dr Sebastian Bürgel: I don’t think the naive dream of individual users monetizing their data is ever going to come to pass. Most data isn’t actually that valuable. Huge platforms like Facebook harvest it now because they can, and because it’s currently low risk and low cost. So why not? Once you start forcing them to put a price on all that, or to distribute their ad revenue to individual users, I think you’ll find they decide most of it is worthless.
Which isn’t to say there’s not smart things to be done with data at the individual level, but I actually think the data privacy revolution will show everyone that the answer is to use far less data much more smartly, and finally wean ourselves off of our indiscriminate data addiction.
Andrey Sergeenkov: What are the core areas of the economy you will see expanding most? Do you see a future where there’s one single data and information space, where everyone controls their own share? If so, what role will the authorities play in regulating it?
Dr Sebastian Bürgel: I think we’re going to see a lot more decentralized versions of things we think of as fundamental parts of the Internet, smaller versions of the huge platforms which currently have all the power. Once we break the data silos and return control to users, it’s much easier for these small nimble services to exist and interoperate.
Building on that, I don’t think there will be a single data and information space. Quite the opposite. I think regulators will have to do a lot of adapting to come up with models of oversight which even make sense in a decentralized digital economy.
Andrey Sergeenkov: What are the biggest future threats to data security, once data becomes fully democratized? In the past, even top-tier exchanges like Binance have been subject to hacks – is there anything that can be done to avoid this in the years ahead?
Dr Sebastian Bürgel: One problem — although I’m not sure I’d call it a threat — with individual control of data is that people have to understand the responsibility that comes with it.
As we move to more decentralized platforms, the hacking risks dramatically reduce, but you’ll get more and more cases of people who simply lose access to their data or funds because they don’t understand that there’s no centralized entity to fix everything when things go wrong.
Andrey Sergeenkov: How can people start managing their data consciously already today? Can you give a few bits of advice on how to improve data security on a day-to-day basis?
Dr Sebastian Bürgel: There are a lot of tools and tricks that people will already be familiar with, like how to manage passwords safely and so on.
But I’d say the most important thing is to take data seriously and educate yourself about how much data, and particularly metadata, we leak all the time.
Many people think that data privacy doesn’t matter because they have “nothing to hide”, but would you really be happy if someone could see everything you did on the Internet and with your phone (including offline metadata like where your phone is physically located) all day, every day, and stored that information for the rest of time?
That’s literally the state of the Internet today.
Andrey Sergeenkov: Is blockchain definitely the last word in data security? What are the advantages and disadvantages, and what other technological trends do you foresee?
Dr Sebastian Bürgel: Blockchain is fundamental to Web 3.0 and the decentralized future, but it’s important not to fetishize it.
Blockchain is slow, expensive, and should be used as a source of truth of last resort.
Most modern decentralized applications like HOPR are focused on problems of how to rely on blockchains LESS, not more.
The biggest trend I see is ways to scale the blockchain layer and retain its trustless properties while minimizing how much data is actually stored there.
Andrey Sergeenkov: How long does it take to build a blockchain-based application? How long did it take to build a solution like HOPR?
Dr Sebastian Bürgel: One major advantage of Web 3.0 is that everything is open and interoperable, so people don’t always have to reinvent the wheel. It’s actually possible to build decentralized applications fairly quickly, and that’s a great thing. HOPR was slightly different, though, because no-one has really tried to provide this level of decentralized metadata privacy before. We’ve had to build a lot of things from scratch. It’s taken our team of around a dozen people almost a year to get where we are today, not including several years of theoretical work before we could start coding.
Andrey Sergeenkov: As one of the early entrants in the market, how do you ensure you maintain a competitive edge once the race heats up? What is your winning selling point against non-blockchain-based propositions? What are the benefits for anyone who has never used blockchain before to incorporate your solution into their business?
Dr Sebastian Bürgel: Firstly, I’d say non-blockchain based solutions don’t even get a look in here. By definition, you simply can’t get the level of metadata privacy HOPR will provide from a centralized solution. You always have to trust that whoever controls the database won’t be misusing your data and passing it on.
Having said that, the blockchain is only a small part of what HOPR does. Companies who need to protect user data and want to use HOPR don’t have to understand about blockchains to get started. In fact, they won’t even notice that it’s underpinned by blockchain technology unless they want to dig into it. Like all good infrastructure, HOPR is designed to work without you having to think about it.
Andrey Sergeenkov: What is the date for HOPR’s token launch? How can anyone acquire HOPR tokens before they’re listed on an exchange?
Dr Sebastian Bürgel: The HOPR token is being launched by our community in the form of the Genesis DAO, a collection of over 3,000 participants in our earlier testnets. The Genesis DAO opted for a private pre-sale followed by a public distribution via a Balancer pool, a decentralized tool for bootstrapping liquidity. That pool will go live at 14:00 CET on February 24th.
We’re keeping things decentralized for now, but we expected to be listed on more centralized exchanges in the near future.
Create your free account to unlock your custom reading experience.