Page 0027

"… To determine whether a natural person is

identifiable [and therefore whether data is personal

data that is the subject of the GDPR], account should

be taken of all the means reasonably likely to be

used, such as singling out, either by the controller

or by another person to identify the natural person

directly or indirectly. To ascertain whether means are

reasonably likely to be used to identify the natural

person, account should be taken of all objective

factors, such as the costs of and the amount of time

required for identification, taking into consideration

the available technology at the time of the

processing and technological developments …"

Given the above background, we would suggest that

whether a hash is personal data and so within the scope

of the GDPR will depend on the circumstances of the

particular case. If the personal data being hashed is

something simple like a name, a phone number or an IP

address and the hashing function is a simple one

(not a salted/peppered hash function) the hash is unlikely

to be sufficiently anonymous. However, if the hash is such

that there are no means reasonably likely to be used by

anyone to identify the individual, then there are good

arguments that the hash itself should not be regarded

as personal data. This view is supported by a number

of commentators including the German Blockchain

Federation (Blockchain Bundesverband), which argues

that the deletion of all off-chain data linking a hash to a

data subject renders the hash anonymous,15 and the UK

Anonymisation Network, which argues anonymous data is

not personal data if all reference data that would enable

one to identify a data subject using the anonymised data

is destroyed - i.e., irreversible anonymisation.16

5.2

How to meet the GDPR

challenge, part 2: establish a

robust contractual governance

framework

There are several key obbligations under the GDPR which

mean that any deployment of a commercial blockchain

network will require a governance framework that is

contractually binding on all participants. For the purposes

of this paper, we consider those key GDPR obligations

to be:

1 detailed data processing agreements as between

controllers and processors;

2 clear and transparent agreements as between joint

data controllers (where relevant);

3 restrictions on transfers of personal data out of the

EEA; and

4 the provision of fair processing information

(i.e. privacy notices).

However, as a pre-requisite to any governance framework,

it will be necessary to implement GDPR-compliant

blockchain solutions on a private, permissioned network

(as opposed to a public, permissionless network).

GDPR and the Blockchain I 25

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