Alastair Johnson wanted to find a way to give people back control over their personal information and identity. His company Nuggets, a UK-based blockchain startup he cofounded with a co-worker from his tenure at Skype, is the result.
The desire to launch a blockchain-based startup was personal. A few years ago, Johnson’s credit card was compromised in a security breech of consumer data.
After receiving notice that his card had been compromised, Johnson contacted his credit card company to sort out his information. To regain access to his account, Johnson was shocked the security protocol was to simply answer the security questions he set when he created his account—the same exact answers that had been compromised in the hack, meaning anyone with access to the hacked data could’ve supplied the answers and recovered his account as if they were him.
In any case, his card was cancelled. A new one was sent in the mail. In the meantime, no longer able to run a transaction on the void card, the subscription services linked with his credit card—like Netflix and Amazon—stopped. When his new card finally did arrive in the mail, it was painfully tedious to update his informaiton accross every merchant and service provider.
“I just thought, ‘Oh my god, this is the worst experience,’” Johnson said.
This isn’t by any means an isolated incident. According to Digital security firm Gemalto, over 1.9 billion personal records have been compromised in the first half of 2017 alone and more than 1.5 billion people, or roughly a quarter of the world’s population, are projected to be affected by data breaches by 2020. And updating credit card informaiton across services can be quickly become a consumers’ least concerns if information is used to steal their identity. In recent weeks, it came out that the stolen identity information of Americans and chatbots were used to submit fake citizen requests for the repeal of net neutrality.
“The strange thing is, you wouldn’t write down on a post-it note your credit card details, your address, your date of birth,” he said. “Online, we effectively do it all over the place, with like a hundred-plus locations.”
Nuggets gives power over personal information and identity back to consumers by encrypting the names, email, phone numbers, and mailing addresses of consumers into blocks on the blockchain to enable secure transacting on Nugget’s blockchain-based consumer platform.
Serving as an intermediary between banks and retailers, Nuggets wants to allow customers to make purchases online without giving up their most private information. Nuggets will also empower consumers over their own data by rewarding them with its digital token “Nugget”, which can in turn be spent with retailers on the platform, whenever they decide to share a portion of their personal information, like their name or mailing address, with a retailer.
And, because your encrypted information is associated with a Nuggets-designated email address that links back to the application interface on your smartphone, which can only be accessed via device biometric security, customer representatives directly ping a user to verify their identity. According to Johnson, this means it isn’t vulnerable to social engineering.
While businesses are certainly incentivized to leverage information to target their customers, and retailers on Nuggets’ platform will still receive aggregated data so they can tailor offers to users, many companies and retailers would rather not take on the monetary and social risk that come with holding onto data. Especially sensitive information, like your name, credit card, or billing address.
“The funny thing is, we thought the retailers would actually be the most difficult to get on board,” Johnson said. “But they’ve basically got open arms. They want it yesterday. Because they see a problem of people forgetting passwords all the time, and they have no interest of keeping that credit card information or that personal information. All they want to do is log you in every time.”
COO and co-founder Seema Johnson emphasized that Nuggets wasn’t created just to build a blockchain company and that the product isn’t nich, even though it employs blockchain technology. Blockchain technology just happened to be the technology that allowed for the features and functionality to deliver security and control of identity for consumers they were looking for. Brooklyn-based Loomia is another startup using blockchain technology to give consumers more power over their own data.
In the future, Johnson said he would like to see Nuggets as the sole intermediary between customers and businesses, creating a world where no silos of information—vulnerable to hackers—exist.
Cadence is a fintech reporter and writer at Fintech Unltd, where she covers the changing landscape of financial technologies. Previously, Cadence interned at Psychology Today, Business Insider and the Wisconsin State Journal. Cadence is interested in how science and technology intersect with power and culture and is curious about the world we are creating for tomorrow, consciously or not. She graduated from the University of Wisconsin–Madison in 2017 with degrees in Journalism and Chinese. Send tips and story ideas to Cadence at [email protected] You can also follow her on Twitter @cadencebambenek.