Last month, the French data protection authority (the CNIL) issued initial guidance addressing issues that applications utilizing blockchain technology should consider in order to comply with the European General Data Protection Regulation (GDPR).
As recognized by the CNIL, there are certain natural conflicts between GDPR and blockchain technology. A critical feature of the blockchain is its immutability – the fact that once information is entered into the public ledger regarding a transaction, that information cannot be changed or removed from the ledger. The benefits of providing a transparent and permanent public ledger will have to be reconciled with the data subject rights granted by GDPR, including the right to be forgotten and principles of data minimization. Blockchain applications also raise thorny questions about whether participants in the network are acting as data controllers or processors, subject to the GDPR’s requirements. Additionally, how can a worldwide network of computers involved in data processing activities comply with GDPR requirements related to cross-border data transfers outside of the EU?
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