This week, Uber’s shortcomings were thrust into the public eye.
The company admitted that hackers had stolen personal data from 57 million of its customers. Only this didn’t happen recently. It happened 12 months ago. And Uber had covered it up.
Instead of alerting the public to the breach, they went to extreme lengths to sweep it under the rug. Including paying the hackers US$100,000 to delete the trove of data.
To smooth things over, recently installed Uber CEO Dara Khosrowshahi assured the market:
‘We are changing the way we do business.’
The breach is the latest explosive scandal Khosrowshahi inherited from his predecessor, Travis Kalanick.
Data Theft is a Huge Threat
However — this is not an isolated event. Large data theft is a huge threat to society, and alarmingly common place. Big companies such as Yahoo, MySpace, Target, Anthem and Equifax have all been hacked in recent months.
And despite the media frenzy, this should come as no surprise. The current system of ‘data-silos’ is flawed. Centralised stores of data held in Facebook, Google, and the central banks are not only invasive, but an unnecessary risk.
They are what is known as a ‘high-value target’ for hackers. Meaning, there is high incentive to hack the server, as it carries so much valuable information.
Simply put, these companies had the equivalent of a web banner that read: ‘Rob me’. Because within the current system, data-theft is that common.
So, what is the alternative?
Decentralised Data Storage
Sia, Storj, and Maidsafe are all creating products where data is not stored in one place. It’s distributed across a network, encrypted, and can only be accessed via your personal key. This is known as decentralised data storage.
Or a worldwide free-market for data.
Like most projects designed to decentralise, it is powered by blockchain — my preferred term is the shared record book.
The effort for a hacker to break into such a low-value target isn’t worth it. Because the reward is so much lower.
The internet is kept ‘on’ by server-farms. To understand these projects, you first need to understand the basics of file storage. The web, at its simplest, is millions of ‘always on’ computers around the world — storing and serving files to users on demand.
These computers, otherwise known as servers, are big business.
Amazon is the biggest of them all.
By some estimates, Amazon’s data-centres could power 45% of the internet on their own. That’s far too much responsibility for one company. The energy required for these projects is also completely impractical.
It was estimated in 2015 that Google’s server-farms required as much energy to run as the nation of Turkey.
And it’s only going to get worse.
Consider this: 92% of the world’s data was created after 2012.
This project was born out of the idea that the internet will continue to grow. However, data storage became the biggest bottleneck to its development.
Sia theorised an innovative way of storing files that didn’t require additional servers. Instead, Sia would use the empty storage space on devices we already had: smartphones, tablets and PCs. Essentially, Sia would turn all of our devices into servers, minimising the need for new server farms.
This would be done by ‘renting’ free space from existing devices all over the world — for a small fee.
So where’s the peace of mind for consumers?
Well, the data would be fragmented, to demotivate an attack. A 10-page document might be separated across 30 storage devices, for example. Meaning one device might hold five lines, while another holds two pages.
This information would be largely useless to a hacker. To cap it all off, the files would be encrypted. Meaning neither Sia nor the ‘host’ could access the information.
Access is only granted to the person who the information belongs to — via their ‘private key’.
This solution demotivates hackers, makes use of devices already created, and is far more energy efficient. Not to mention, it’s far harder to hack.
You could say it’s a no-brainer.
Siacoin has a market cap of 191 million and is currently trading at AU$0.0062.
Junior Analyst, Money Morning
PS: To find out more about the secret world of bitcoin, click here.