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Introduction

The Senate bill introduced on 19 March 2024 in the United States would require online platforms to obtain consumer consent before using their data for Artificial Intelligence (AI) model training. If a company fails to obtain this consent, it would be considered a deceptive or unfair practice and result in enforcement action from the Federal Trade Commission (FTC) under the AI consumer opt-in, notification standards, and ethical norms for training (AI Consent) bill. The legislation aims to strengthen consumer protection and give Americans the power to determine how their data is used by online platforms. 

The proposed bill also seeks to create standards for disclosures, including requiring platforms to provide instructions to consumers on how they can affirm or rescind their consent. The option to grant or revoke consent should be made available at any time through an accessible and easily navigable mechanism, and the selection to withhold or reverse consent must be at least as prominent as the option to accept while taking the same number of steps or fewer as the option to accept.

The AI Consent bill directs the FTC to implement regulations to improve transparency by requiring companies to disclose when the data of individuals will be used to train AI and receive consumer opt-in to this use. 
The bill also commissions an FTC report on the technical feasibility of de-identifying data, given the rapid advancements in AI technologies, evaluating potential measures companies could take to effectively de-identify user data.

The definition of ‘Artificial Intelligence System’ under the proposed bill

ARTIFICIALINTELLIGENCE SYSTEM- The term artificial intelligence system“ means a machine-based system that—

1. Is capable of influencing the environment by producing an output, including predictions, recommendations or decisions, for a given set of objectives; and
2. 2. Uses machine or human-based data and inputs to

(i) Perceive real or virtual environments;

(ii) Abstract these perceptions into models through analysis in an automated manner (such as by using machine learning) or manually; and

(iii) Use model inference to formulate options for outcomes.

Importance of the proposed AI Consent Bill USA

1. Consumer Data Protection: The AI Consent bill primarily upholds the privacy rights of an individual. Consent is necessitated from the consumer before data is used for AI Training; the bill aims to empower individuals with unhinged autonomy over the use of personal information. The scope of the bill aligns with the greater objective of data protection laws globally, stressing the criticality of privacy rights and autonomy.

2. Prohibition Measures: The proposed bill intends to prohibit covered entities from exploiting the data of consumers for training purposes without their consent. This prohibition extends to the sale of data, transfer to third parties and usage. Such measures aim to prevent data misuse and exploitation of personal information. The bill aims to ensure companies are leveraged by consumer information for the development of AI without a transparent process of consent.

3. Transparent Consent Procedures: The bill calls for clear and conspicuous disclosures to be provided by the companies for the intended use of consumer data for AI training. The entities must provide a comprehensive explanation of data processing and its implications for consumers. The transparency fostered by the proposed bill allows consumers to make sound decisions about their data and its management, hence nurturing a sense of accountability and trust in data-driven practices.

4. Regulatory Compliance: The bill's guidelines call for strict requirements for procuring the consent of an individual. The entities must follow a prescribed mechanism for content solicitation, making the process streamlined and accessible for consumers. Moreover, the acquisition of content must be independent, i.e. without terms of service and other contractual obligations. These provisions underscore the importance of active and informed consent in data processing activities, reinforcing the principles of data protection and privacy.

5. Enforcement and Oversight: To enforce compliance with the provisions of the bill, robust mechanisms for oversight and enforcement are established. Violations of the prescribed regulations are treated as unfair or deceptive acts under its provisions. Empowering regulatory bodies like the FTC to ensure adherence to data privacy standards. By holding covered entities accountable for compliance, the bill fosters a culture of accountability and responsibility in data handling practices, thereby enhancing consumer trust and confidence in the digital ecosystem.

Importance of Data Anonymization

Data Anonymization is the process of concealing or removing personal or private information from the data set to safeguard the privacy of the individual associated with it. Anonymised data is a sort of information sanitisation in which data anonymisation techniques encrypt or delete personally identifying information from datasets to protect data privacy of the subject. This reduces the danger of unintentional exposure during information transfer across borders and allows for easier assessment and analytics after anonymisation. When personal information is compromised, the organisation suffers not just a security breach but also a breach of confidence from the client or consumer. Such assaults can result in a wide range of privacy infractions, including breach of contract, discrimination, and identity theft.

The AI consent bill asks the FTC to study data de-identification methods. Data anonymisation is critical to improving privacy protection since it reduces the danger of re-identification and unauthorised access to personal information. Regulatory bodies can increase privacy safeguards and reduce privacy risks connected with data processing operations by investigating and perhaps implementing anonymisation procedures.

The AI consent bill emphasises de-identification methods, as well as the DPDP Act 2023 in India, while not specifically talking about data de-identification, but it emphasises the data minimisation principles, which highlights the potential future focus on data anonymisation processes or techniques in India.

Conclusion

The proposed AI Consent bill in the US represents a significant step towards enhancing consumer privacy rights and data protection in the context of AI development. Through its stringent prohibitions, transparent consent procedures, regulatory compliance measures, and robust enforcement mechanisms, the bill strives to strike a balance between fostering innovation in AI technologies while safeguarding the privacy and autonomy of individuals.

References:

• https://fedscoop.com/consumer-data-consent-training-ai-models-senate-bill/#:~:text=%E2%80%9CThe%20AI%20CONSENT%20Act%20gives,Welch%20said%20in%20a%20statement
• https://www.dataguidance.com/news/usa-bill-ai-consent-act-introduced-house#:~:text=USA%3A%20Bill%20for%20the%20AI%20Consent%20Act%20introduced%20to%20House%20of%20Representatives,-ConsentPrivacy%20Law&text=On%20March%2019%2C%202024%2C%20US,the%20U.S.%20House%20of%20Representatives
• https://datenrecht.ch/en/usa-ai-consent-act-vorgeschlagen/
• https://www.lujan.senate.gov/newsroom/press-releases/lujan-welch-introduce-billto-require-online-platforms-receive-consumers-consent-before-using-their-personal-data-to-train-ai-models/

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Introduction

The world has been surfing the wave of technological advancements and innovations for the past decade, and it all pins down to one device – our mobile phone. For all mobile users, the primary choices of operating systems are Android and iOS. Android is an OS created by google in 2008 and is supported by most brands like – One+, Mi, OPPO, VIVO, Motorola, and many more and is one of the most used operating systems. iOS is an OS that was developed by Apple and was introduced in their first phone – The iPhone, in 2007. Both OS came into existence when mobile phone penetration was slow globally, and so the scope of expansion and advancements was always in favor of such operating systems.

The Evolution

iOS

Ever since the advent of the iPhone, iOS has seen many changes since 2007. The current version of iOs is iOS 16. However, in the course of creating new iOS and updating the old ones, Apple has come out with various advancements like the App Store, Touch ID & Face ID, Apple Music, Podcasts, Augmented reality, Contact exposure, and many more, which have later become part of features of Android phone as well. Apple is one of the oldest tech and gadget developers in the world, most of the devices manufactured by Apple have received global recognition, and hence Apple enjoys providing services to a huge global user base.

Android

The OS has been famous for using the software version names on the food items like – Pie, Oreo, Nougat, KitKat, Eclairs, etc. From Android 10 onwards, the new versions were demoted by number. The most recent Android OS is Android 13; this OS is known for its practicality and flexibility. In 2012 Android became the most popular operating system for mobile devices, surpassing Apple’s iOS, and as of 2020, about 75 percent of mobile devices run Android.

Android vs. iOS

1. USER INTERFACE

One of the most noticeable differences between Android and iPhone is their user interface. Android devices have a more customizable interface, with options to change the home screen, app icons, and overall theme. The iPhone, on the other hand, has a more uniform interface with less room for customization. Android allows users to customize their home screen by adding widgets and changing the layout of their app icons. This can be useful for people who want quick access to certain functions or information on their home screen. IOS does not have this feature, but it does allow users to organize their app icons into folders for easier navigation.

2. APP SELECTION

Another factor to consider when choosing between Android and iOS is the app selection. Both platforms have a wide range of apps available, but there are some differences to consider. Android has a larger selection of apps overall, including a larger selection of free apps. However, some popular apps, such as certain music streaming apps and games, may be released first or only available on iPhone. iOS also has a more curated app store, meaning that all apps must go through a review process before being accepted for download. This can result in a higher quality of apps overall, but it can also mean that it takes longer for new apps to become available on the platform. iPhone devices tend to have less processing power and RAM. But they are generally more efficient in their use of resources. This can result in longer battery life, but it may also mean that iPhones are slower at handling multiple tasks or running resource-intensive apps.

3. PERFORMANCE

When it comes to performance, both Android and iPhone have their own strengths and weaknesses. Android devices tend to have more processing power and RAM. This can make them faster and more capable of handling multiple tasks simultaneously. However, this can also lead to Android devices having shorter battery life compared to iPhones.

4. SECURITY

Security is an important consideration for any smartphone user, and Android and iPhone have their own measures to protect user data. Android devices are generally seen as being less secure than iPhones due to their open nature. Android allows users to install apps from sources other than the Google Play Store, which can increase the risk of downloading malicious apps. However, Android has made improvements in recent years to address this issue. Including the introduction of Google Play Protect, which scans apps for malware before they are downloaded. On the other hand, iPhone devices have a more closed ecosystem, with all apps required to go through Apple‘s review process before being available for download. This helps reduce the risk of downloading malicious apps, but it can also limit the platform’s flexibility.

Conclusion

The debate about the better OS has been going on for some time now, and it looks like it will get more comprehensive in the times to come, as netizens go deeper into cyberspace, they will get more aware and critical of their uses and demands, which will allow them to opt for the best OS for their convenience. Although the Andriod OS, due to its integration, stands more vulnerable to security threats as compared to iOS, no software is secure in today’s time, what is secure is its use and application hence the netizen and the platforms need to increase their awareness and knowledge to safeguard themselves and the wholesome cyberspace.

What are Decentralised Autonomous Organizations (DAOs)?

A Decentralised Autonomous Organisation or a DAO, is a unique take on democracy on the blockchain. It is a set of rules encoded into a self-executing contract (also known as a smart contract) that operates autonomously on a blockchain system. A DAO imitates a traditional company, although, in its more literal sense, it is a contractually created entity. In theory, DAOs have no centralised authority in making decisions for the system; it is a communally run system whereby all decisions (be it for internal governance or for the development of the blockchain system) are voted upon by the community members. DAOs are primarily characterised by a decentralised form of operation, where there is no one entity, group or individual running the system. They are self-sustaining entities, having their own currency, economy and even governance, that do not depend on a group of individuals to operate. Blockchain systems, especially DAOs are characterised by pure autonomy created to evade external coercion or manipulation from sovereign powers. DAOs follow a mutually created, agreed set of rules created by the community, that dictates all actions, activities, and participation in the system’s governance. There may also be provisions that regulate the decision-making power of the community.

Ethereum’s DAO’s White Paper described DAO as “The first implementation of a [DAO Entity] code to automate organisational governance and decision making.” Can be used by individuals working together collaboratively outside of a traditional corporate form.  It can also be used by a registered corporate entity to automate formal governance rules contained in corporate bylaws or imposed by law.”  The referred white paper proposes an entity that would use smart contracts to solve governance issues inherent in traditional corporations.  DAOs attempt to redesign corporate governance with blockchain such that contractual terms are “formalised, automated and enforced using software.”

Cybersecurity threats under DAOs

While DAOs offer increased transparency and efficiency, they are not immune to cybersecurity threats. Cybersecurity risks in DAO, primarily in governance, stem from vulnerabilities in the underlying blockchain technology and the DAO's smart contracts. Smart contract exploits, code vulnerabilities, and weaknesses in the underlying blockchain protocol can be exploited by malicious actors, leading to unauthorised access, fund manipulations, or disruptions in the governance process. Additionally, DAOs may face challenges related to phishing attacks, where individuals are tricked into revealing sensitive information, such as private keys, compromising the integrity of the governance structure. As DAOs continue to evolve, addressing and mitigating cybersecurity threats is crucial to ensuring the trust and reliability of decentralised governance mechanisms.

Centralisation/Concentration of Power

DAOs today actively try to leverage on-chain governance, where any governance votes or transactions are directly taken on the blockchain. But such governance is often plutocratic in nature, where the wealthy hold influences, rather than democracies, since those who possess the requisite number of tokens are only allowed to vote and each token staked implies that many numbers of votes emerge from the same individual. This concentration of power in the hands of “whales” often creates disadvantages for the newer entrants into the system who may have an in-depth background but lack the funds to cast a vote. Voting, presently in the blockchain sphere, lacks the requisite concept of “one man, one vote” which is critical in democratic societies.

Smart contract vulnerabilities and external threats

Smart contracts, self-executing pieces of code on a blockchain, are integral to decentralised applications and platforms. Despite their potential, smart contracts are susceptible to various vulnerabilities such as coding errors, where mistakes in the code can lead to funds being locked or released erroneously. Some of them have been mentioned as follows;

Smart Contracts are most prone to re-entrance attacks whereby an untrusted external code is allowed to be executed in a smart contract. This scenario occurs when a smart contract invokes an external contract, and the external contract subsequently re-invokes the initial contract. This sequence of events can lead to an infinite loop, and a reentrancy attack is a tactic exploiting this vulnerability in a smart contract. It enables an attacker to repeatedly invoke a function within the contract, potentially creating an endless loop and gaining unauthorised access to funds.

Additionally, smart contracts are also prone to oracle problems. Oracles refer to third-party services or mechanisms that provide smart contracts with real-world data. Since smart contracts on blockchain networks operate in a decentralised, isolated environment, they do not have direct access to external information, such as market prices, weather conditions, or sports scores. Oracles bridge this gap by acting as intermediaries, fetching and delivering off-chain data to smart contracts, enabling them to execute based on real-world conditions. The oracle problem within blockchain pertains to the difficulty of securely incorporating external data into smart contracts. The reliability of external data poses a potential vulnerability, as oracles may be manipulated or provide inaccurate information. This challenge jeopardises the credibility of blockchain applications that rely on precise and timely external data.

Sybil Attack: A Sybil attack involves a single node managing multiple active fake identities, known as Sybil identities, concurrently within a peer-to-peer network. The objective of such an attack is to weaken the authority or influence within a trustworthy system by acquiring the majority of control in the network. The fake identities are utilised to establish and exert this influence. A successful Sybil attack allows threat actors to perform unauthorised actions in the system.

Distributed Denial of Service Attacks: A Distributed Denial of Service (DDoS) attack is a malicious attempt to disrupt the regular functioning of a network, service, or website by overwhelming it with a flood of traffic. In a typical DDoS attack, multiple compromised computers or devices, often part of a botnet (a network of infected machines controlled by a single entity), are used to generate a massive volume of requests or data traffic. The targeted system becomes unable to respond to legitimate user requests due to the excessive traffic, leading to a denial of service.

Conclusion

Decentralised Autonomous Organisations (DAOs) represent a pioneering approach to governance on the blockchain, relying on smart contracts and community-driven decision-making. Despite their potential for increased transparency and efficiency, DAOs are not immune to cybersecurity threats. Vulnerabilities in smart contracts, such as reentrancy attacks and oracle problems, pose significant risks, and the concentration of voting power among wealthy token holders raises concerns about democratic principles. As DAOs continue to evolve, addressing these challenges is essential to ensuring the resilience and trustworthiness of decentralised governance mechanisms. Efforts to enhance security measures, promote inclusivity, and refine governance models will be crucial in establishing DAOs as robust and reliable entities in the broader landscape of blockchain technology.

References:

‍https://www.imperva.com/learn/application-security/sybil-attack/

‍https://www.tripwire.com/state-of-security/blockchain-security-understanding-vulnerabilities-and-mitigating-risks

‍https://medium.com/@RedStone_Finance/the-oracle-problem-and-its-implications-for-blockchains-c0c0ad9cf5a7

‍https://www.linkedin.com/posts/satish-kulkarni-bb96193_what-are-cybersecurity-risk-to-dao-and-how-activity-7048286955645677568-B3pV/ https://www.geeksforgeeks.org/what-is-ddosdistributed-denial-of-service/ Report of Investigation Pursuant to Section 21 (a) of the Securities Exchange Act of 1934: The DAO, Securities and Exchange Board, Release No. 81207/ July 25, 2017

‍https://www.sec.gov/litigation/investreport/34-81207.pdf https://www.legalserviceindia.com/legal/article-10921-blockchain-based-decentralized-autonomous-organizations-daos-.html