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Cambridge Analytica and Decentralised Social Media

In a similar vein to Bitcoin emerging as a response to the 2008 financial crisis, can the uncovering of Cambridge Analytica's data-harvesting and election-swaying prove a strong enough catalyst for a similar phenomenon to take hold of social media?

Replicated across each of the (currently 10,000+) nodes participating in the Bitcoin network is a copy of the genesis block. Alongside standard data, it contains an immutable copy of the then recently published headline:.

The Times 03/Jan/2009 Chancellor on brink of second bailout for banks

Bitcoin has strong roots in the cypherpunk movement, where peer-to-peer cash was a long-time vision, with several incarnations before Bitcoin that never quite took off. But this time, the heavy disillusionment created by the financial crisis resulted in the perfect storm for a decentralised alternative to the current financial system, which didn't rely on trust in any central authority, to gain support and traction. The libertarian side had a strong argument for why the monetary system may make more sense outside Government, and the technical innovations in Bitcoin's whitepaper solved the double spending problem of previous peer-to-peer cash attempts, making a truly trustless and peer-to-peer monetary system a real possibility.

Although in a completely different domain, I think parallels can be drawn with the Cambridge Analytica story, the "#deletefacebook" movement, and so on. A large majority of the population trusted Facebook with their data, allowed it to grow to one of the world's largest institutions, and in return expeced a fairly straightforward service of being able to share status updates, photos and events with their friends.

Facebook's rebuttal to the situation is that Kogan/CA exploited a personal data extraction loophole which has long since been patched. But in my view this misrperesents the larger issue. Facebook's core business model, leading to its tens of billions in yearly revenue, is marketing, a key feature of which is tools for targeting. And as Facebook knows, more granular targeting leads to higher bids. So while the current PR storm may require Facebook to temporarily step back with these, it's certainly not its natural desire or direction.

Even if Facebook ends up completely pivoting away from trying to be a platform for apps, closing all potential means for data harvesting, that just enables Facebook to take a bigger cut of the funds flowing from, in this case, political donations funneling towards micro-targeted advertising campaigns, as the targeting needs to be done inside Facebook's black box instead.

Taking a step back, the idea that it's necessary to contend with these forces when trying to communicate online with friends seems bizarre. Over the last decade Facebook has done a great job of maintaining the same friendly facade of the generally useful service it initially offered, while gradually becoming more and more insidious with its underlying motivations and revenue stream.

While marketing, targeting, and playing on emotions has been an integral part of political campaigns for decades, the insight that technology has now reached a point where data-mining and targeted advertising can play on these psychological weaknesses, in a manner that's largely automated by computers, has some worrying implications. Perhaps the biggest flaw in democracy is that voters can be manipulated by those in positions of power who want to maintain it, and while there was previously at least a bandwidth limit to this while it was done manually by humans, this just accelerates the trend towards its natural conclusion, where the result of a democratic process is a direct representation of who spent the most money influencing a certain result.

Thinking about where this can be tackled is a tricky issue. No matter how savvy one thinks they are, if something knows them well enough (maybe even better than their friends and family do), it's extremely likely that a certain type of messaging could be crafted that plays on their exact curiosities, dreams, and fears, to drive their opinion.

Probably a good first line of defense would be to stop giving up personal data. With no input data to work with, an algorithm, by definition, can't produce any targeted output. This would mean a move towards platforms which have business models that don't rely on collecting user data as their value proposition to their real clients.

Has it finally reached a point where people will start to question whether a central service should actually be given this responsibility, or if it's time for a decentralised/peer-to-peer to solution to emerge? Has Facebook finally peaked, and its network effects been weakened enough that an alternative can gain real traction? Will people appreciate and be able to articulate the values that could be provably built in to a decentralised social network solution?

While it would be nice to see this kind of movement towards peer-to-peer technologies apply to social media too, I think there is one factor unique to Bitcoin which can help explain its unprecedented rise in global popularity and even degrees of acceptance by the very institutions it was designed to replace -- by nature being a new monetary system with strictly limited supply, it's become clear to any observer the potential for huge profits to arise. A capitalist will sell you the rope to hang him with, if he thinks he can make a profit on it.