Many privacy professionals view the European Union's General Data Protection Regulation as a watershed moment in the evolution of data privacy law. And this law, along with the California Consumer Privacy Act will have a big impact on blockchain.

When obstacles associated with a regulatory framework are left in the past, CMOs face a new kind of challenge -- learning how to combine profitability and privacy. So far, it’s largely been a one-way street. Websites collect user data and sell it to advertisers, who then use it for the purposes of advertising personalization.

Entrepreneurs, startups, publishers and advertisers should direct their efforts toward rewarding user attention in exchange for their data usage, which is especially important in regard to the General Data Protection Regulation.

A year-long pilot that uses blockchain to improve online advertising efficiency has yielded promising initial results, according to IBM CMO Michelle Peluso.

The project has already reduced pennies on the dollar of waste in the area of ad reconciliation and brought greater transparency to the complex gauntlet of intermediaries brand advertisers have to deal with, Peluso told VentureBeat in an interview this week. And there’s more to come, she said.

Reconciliation refers to the process advertisers use to ensure contracted agreements are actually delivered. Peluso estimated the average savings at 2 to 3 percentage points, though the company is still collecting results from its multiple brand partners.

Blockchain can help solve one of the advertising industry's biggest challenges: opaque advertising practices.  Publishers, advertisers, and ad tech vendors are exploring blockchain as a tool to boost transparency around ad practices, with the end goal of reducing fraud. Ad fraud is expected to cost the industry $44 billion by 2022, up from $19 billion this year, according to Juniper Research estimates. Through its function as a public database, blockchain can store information about a digital advertisement, like who has created it, while sharing it with everyone else on the network in a verifiable and immutable way. For digital advertising, that means ad impressions can be tracked along the supply chain, and advertisers can record where an ad is delivered. 

Blockchain and AI are now widely used by enterprises to improve their internal processes and products. In a dedicated analysis for Cointelegraph, Julia Magas wrote that by being able to continuously analyze data under a strict protocol required for achieving desired results, AI leads the way by allowing data to be properly stratified and shared.

Blockchain lends its characteristics to make sure the data is handled in an environment that is safe from external interference, as well as tampering of data ownership and sequence.

Accordingly, it’s notable that this month the CFP Board announced that it would be expanding its list of available topics for CFP CE credit to specifically include a component for certain technology content. New technology-related CE topics going forward will include strategies to protect a client’s personal data and privacy, understanding and leveraging technology to diversity portfolios, cryptocurrency and blockchain, and cybersecurity.

The greatest problem of the advertising market is that buy-side receives a very limited amount of information about purchased impressions. Sure, advertisers can track generally available metrics, such as clicks, views, performed actions. Nevertheless, this is only the tip of the iceberg, the real effectiveness of these depend on the quality of traffic, inspection of which is borderline impossible. Likewise, companies see only the total cost of services and stay largely unaware of potential hidden fees and margins.

Every year, the number of brands that no longer want to cope with this situation increase. Based on an immutable decentralized ledger, blockchain ad platforms become a new point of trust which enables complete audit for demand and supply partners on an event-level basis. Blockchain controls the integrity and chronology of transaction data placed in separate repositories. This is extremely important for combating ad fraud and protecting user data.

iBank Digital Asset L.P. (“iBank Digital”, “iBank Exchange”) and iCashRewards (“iCash”) announced today that it is exploring use of the DigitalBits blockchain to tokenize iCashRewards loyalty points.

iCashRewards’ recipients will be able to use the iCash loyalty token as a form of payment on iBankEx and iCash Ecosystem, allowing users to benefit from reduced exchange and transaction fees.

David Chaum challenged the blockchain industry to focus on quantum-resistant blockchains and digital currencies: “We have no way of knowing how far along nation states are in developing quantum computers.  In the past, government entities have broken codes and possessed cryptographic capabilities for many years without anyone knowing.  The news that Google has achieved quantum supremacy strengthens my belief that quantum computing is coming and as a consequence, I believe we should all use approaches that are quantum-resistant.”

Chaum also shared details of his own new digital currency technology supported by the quantum-resistant blockchain, Praxxis which features a new approach to consensus.

The Praxxis protocol uses quantum-resistant signatures based on large random numbers while simultaneously overcoming the scalability, privacy, and security challenges faced by legacy blockchains.  The result is a useable  “purely peer-to-peer version of electronic cash” as Satoshi called for in the first few words of his whitepaper.  The protocol also addresses the consensus requirements for Chaum’s Elixxir project which protects user metadata.

Gartner said blockchain for advertising holds tremendous promise, but must first overcome significant challenges with scalability, performance and adoption. Dozens of companies have used experimental blockchain platforms for advertising, but none have been able to demonstrate ongoing viability.

How much of your job can you do without having access to unencrypted data? For example, in the marketing research space, there are vendors for survey respondents, reporting tools and survey platforms that operate as intermediaries between the consumer/research participant and the research organization (a brand or agency). This service can actually be provided without having direct access to any unencrypted data, and without drawing from a centralized database. This is analogous to apps like WhatsApp where end-to-end encryption is utilized to ensure secure communication. Any entity that potentially handles any sensitive data, including user and health data, can benefit from employing these techniques to ensure data is protected and unnecessary liability is avoided. Fortunately, along with the interest in blockchain and bitcoin technologies, we’ve seen considerable advancement in cryptographic techniques which enable new opportunities for secure communication.

But there might be a solution on the horizon. Blockchain-based ads could eliminate fraud and substantially streamline the ad industry. Plus, a decentralized ad option would level the playing field for marketers and enable smaller organizations to compete with digital giants. But marketers beware — some blockchain solutions might expose new vulnerabilities to large-scale exploits. 
Blockchain is just one of the innovative technologies included in the 2019 Gartner Hype Cycle for Digital Marketing and Advertising that marketers should focus on to drive real value.