Decentralization and sovereignty: Debunking our approach to digital sovereignty

People have lost control of their destiny — well, control of their digital identity — when navigating the online world. But with more of our interactions taking place online, it becomes increasingly vital to raise awareness of the potential dangers related to our data.

Whether it’s browser data or sensitive information, our digital snail trail is frequently extrapolated and shared under our noses, but its repercussions are becoming more clear. MGM’s recent data breach resulted in around $100 million in losses and innumerable impacted customers. Bankruptcy provider Kroll revealed that FTX, Genesis and BlockFi customers’ data leaked following a cybersecurity hack. While 74% of these hacks are achieved through social engineering, Verizon also found that the volume of ransomware attacks was greater in the past couple of years than the previous five years combined.

While digital sovereignty is often illustrated as a far-fetched fantasy, requiring a complete overhaul of the current system or a total exodus to decentralized infrastructure, must we default to extremes to improve the way people exercise control of their online lives? While blockchain technology offers significant hope, there are other stepping stones to sovereignty that could prove more accessible and approachable to mainstream users.

Sovereignty and decentralization: What’s the difference?

Sovereignty is tied to owning and controlling your online identity and using tools that are fully under one’s control while arbitrating who can access information owned and produced by yourself. It does not require a higher authority for validation or authentication because that authority is you — but sovereignty is more multi-faceted than that.

Relying on a decentralized autonomous organization (DAO) or coded blockchain to make your decisions is sovereign, but a user exercising control over who sees their online data is also sovereign. This is because sovereignty is not a rivalrous resource. If you give someone access to your data, you are empowered to revoke that access at any time.

While decentralization is also about exercising control, it concerns who the power is assigned to or spread out between. Decentralized frameworks are built with the intention of making actions and decisions more fault-tolerant by breaking our cultural status quo: distributing control to a network of many as opposed to an entity of one like traditional financial institutions or large-scale businesses like Apple or Meta.

Current decentralization is largely achieved through shared ledgers and the Bitcoin consensus model, but convincing mainstream tech leaders to wholly adopt these decentralized systems isn’t too practical. Simply put, the motivation is not there — companies enjoy the financial luxuries and lack of government control that come with possessing centralized ownership of their platforms and users. 

However, scalable decentralization can be achieved through sovereign data and processing. These two approaches provide different parts of the benefits of decentralization: the Bitcoin version being good at managing a shared state without a central authority, and the sovereign approach being better at managing individual states that can be trustlessly shared.

Because of this, adopting sovereignty is actually easier since it can be done in varying increments. Adopting decentralization is more difficult because it’s asking people to disavow the current online world they have built their online identity around with browsers, applications, profiles and conforming to a foreign, often confusing, decentralized world. The decentralization of finance through crypto is one example of its potential but it’s not convincing enough to drive mass adoption. 

Although decentralization is freeing, it’s also very limiting in its current state. The ecosystem is still maturing — there is a lot of growth to realize and regulatory understanding to define before we can expand into the decentralized world.

Leveraging digital sovereignty

Fortunately, decentralization is just one technique used in accomplishing sovereignty. To participate in digital sovereignty, even today, we need to hold tight to the following factors. 

The right to use your own data

The battle for control over our data is exemplified by companies that erect obstacles to prevent users from effortlessly obtaining, understanding, moving or using their own data. 

Consider the scenario where you want to shift all of your Facebook posts to Discord. How is this accomplished? Do you obtain a comprehensive dataset or just the data that’s presented to you on the platform? The right to use your own data demands an accessible and user-centric approach to data transfer.

Data’s intrinsic value and independence

Another facet of digital sovereignty revolves around data’s ability to independently hold value and function regardless of the context or the authentication behind it. 

Often, platforms offer limited accessibility to data, constraining users to certain functions tied to their accounts. This limitation curtails your ownership of the data, making it challenging to harness its intrinsic value or function without compromising user privacy.

The right to control access and use of your own data by others with privacy options

Digital sovereignty is also about retaining control over who can access and use your data while maintaining your privacy. The mystifying world of targeted advertising serves as an illustration of this. 

Often, we’re bombarded with ads, but we’re left in the dark about why a particular ad targets us. The ability to understand which datasets are used to profile us and how the conclusion that an ad is relevant is reached is a fundamental part of digital sovereignty. AI can play a pivotal role in allowing users to query their data to identify the reasons behind ad targeting.

Are we prepared for digital sovereignty?

While digital sovereignty is the goal, it demands substantial changes that our society cannot implement overnight. Progress is being made, but there’s still much to unravel before accessible digital sovereignty becomes mainstream. If individuals and companies can shoulder more responsibility in safeguarding data by adopting more sovereign tools, we can move closer to a secure, fair digital reality.

In this journey toward digital sovereignty, the right to control one’s data, data’s intrinsic value and the ability to retain control and privacy over data stand as the cornerstones of a future where individuals are in charge of their digital destinies.

Arie Trouw is the co-founder of XYO and founder of XY Labs.

This article was published through Cointelegraph Innovation Circle, a vetted organization of senior executives and experts in the blockchain technology industry who are building the future through the power of connections, collaboration and thought leadership. Opinions expressed do not necessarily reflect those of Cointelegraph.

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