What is privacy?

It’s unlikely that many of us ask this question as often as we should, but in a world where almost every piece of technology is tracking our preferences, movements and opinions, our personal data has become one of the most valuable commodities in the world: So, should we be taking privacy more seriously?

In order to get an understanding of what privacy is, we first need to define it. The Cambridge Dictionary defines privacy as:

‘The right that someone has to keep their personal life or personal information secret or known only to a small group of people: Among the three industries studied, concerns about privacy and security of data were highest in the financial sector.’

Why have we lost it?

Vast amounts of data are collected as a matter of routine from every interaction that can be tracked, monitored, and analysed. Data is hugely valuable to businesses and governments for legitimate planning and efficiency needs, but as is always the way, corporate greed and overreach by organizations has become endemic. Additionally, the cost of storing digital information continuously trends lower, pricing the creation of a permanent record for everyone at essentially zero.

The majority of the population has not even recognised this is happening, let alone appreciated the impact. Our loss of privacy is one of the biggest threats to personal autonomy and our rights as individuals in a functioning society. 

More details can be found in this report: https://internationalbanker.com/technology/why-data-is-the-new-commodity-in-the-global-economy/

Why does it matter?

Whilst many forms of data collection may seem innocuous, you may ask yourself “So what if a shop knows my shopping habits? It just makes my online experience easier and quicker”. This is a valid point, but suffice to say it is just the first step to losing far more privacy and rights than you may think.

Privacy is not an opportunity or tool to exclude yourself from contributing to a functional society. It is not a way to avoid being part of the established systems that exist in support of a fair and just world.

Financial Privacy

So, onto the most important aspect of privacy…That of your money. Money describes what you trade your lifetime and skills for, what you desire and value in exchange for these sacrifices. This detailed record of exchange with the rest of society encompasses a substantial portion of the most private information there is about you.

Therefore, the loss of privacy in your financial affairs is by far the most fundamental shift in power a person can experience.

The risks of no privacy

Not having financial privacy brings many potential risks, not only for the businesses and institutions that carry out many billions of transactions daily, but equally as important, for the individual going about their daily life. 

It is essential for people to have the right to transact in private, and this could be summed up by the following statement:

‘The freedom to transact is given by the ability to detach from your identity’

…meaning that without a certain level of financial privacy you do not have the right to send or store money where you want or need to, and cannot have full ownership of your financial assets.

For many thousands of years the human race has flourished and advanced thanks in large part to our ability to transact freely and without hindrance. It is this free trade that has allowed the exchange of technology, food, commodities, and all manner of useful goods. The person to person exchange of value served mankind well for many centuries, but as our reach grew and trade was conducted over longer distances, it was no longer feasible to exchange large quantities of whatever constituted as a currency.

Money goes digital

With the eventual creation of the internet, true global trade became a reality with the advent of digital value transfer, and with it the challenges this technology brings.

The advent of blockchain technology has heralded a potentially seismic shift in global finances and could represent the greatest opportunity for opening up access to many more people globally who are underserved by the current systems.

There is, however, one major flaw in the vast majority of cryptocurrency ledgers, that of all-encompassing transparency. Most coins have publicly viewable addresses that can be linked to balances and transactions, and potentially expose the user to criminal activity or other bad actors having visibility of sensitive financial information.

Transparent ledgers carry additional risk for users with the coins they hold potentially being linked back to criminal activity. This is due to the lack of fungibility (each unit being the same like bank notes) that could lead to a person’s money being frozen or seized despite them carrying out their business legitimately. 

Although existing bank accounts have a certain level of privacy to provide user security, account and transaction details are increasingly being monitored and the data sold to analytics companies for profit.

Why we should expect privacy.

Privacy only makes a real difference if it is made integral to our daily lives and to do that successfully it requires a majority of a given population to demand it. 

If no-one expects it then it will be eroded, either deliberately or through the lack of demand, and once it reaches a critical mass then it becomes very difficult to regain. Transparency in itself, and in the right circumstances, can be a helpful and useful tool but only when it is with the explicit consent of those directly impacted.

Privacy really is not about hiding anything. It’s about the empowerment and control to share the information you’re comfortable sharing with those you want to share it with.

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