Fintech firm 360 Finance has set up a research institute aimed at developing technologies to improve privacy and digital security in the financial services industry.
Why it matters: The move comes as China doubles down on cryptography regulation, passing a dedicated law in the hopes of enhancing information security in cyberspace.
- The new law supports the research of cryptographic methods for privacy protection as data breaches and theft in China remains a widespread issue.
- Chinese regulators have clamped down on the financial services sector, increasing scrutiny on how user data is used and where it comes from.
- Police raided Hong Kong-listed 51 Credit Card’s office in the eastern Chinese city of Hangzhou after the company was accused of improperly acquiring client data from a Chinese bank.
- 360 Finance’s parent company, cybersecurity firm Qihoo 360, has not been free from controversy. In 2012, the firm was accused of stealing user information, an accusation it dismissed as being made up by competitors.
Details: 360 Finance’s Privacy Protection and Secure Computing Institute will be led by Shen Yun, the company’s chief data scientist.
- The dramatic increase in the availability of data, the increased diversity of data types, and the number of application scenarios will have an adverse effect on privacy and information security, Shen said in a statement.
- 360 Finance implements homomorphic encryption, which allows for computation on encrypted rather than plaintext data, and federated learning—creating centralized machine-learning models by running computations on a user’s device so personal data is not transferred in the process.
- The goal is to “open up data silos” while ensuring privacy protection to enable “data sharing and value transfer,” Shen said.
Context: Data leaks remain a widespread issue in China even as the country imposes numerous laws and frameworks to protect consumer information.
- With an increasing portion of the country moving online, more data could potentially be at risk of falling into the wrong hands.
- Personal information also comes cheap. An investigation last year found that hackers were selling stolen personal information from internet users for as little as $0.01.