The crypto industry has royal tightened its privacy

Data protection is a complex issue. Few people think that privacy is not important. It is generally more interesting to talk about controversial matters. The restrictive arguments against data protection actually make the discussion boring and easy to take for granted. As Edward Snowden famously said, “The argument that you don’t care about privacy because you have nothing to hide is like the argument that you don’t care about freedom of expression because you have nothing to say.” crypto 

But what if your privacy isn’t a priority? What if your privacy isn’t guaranteed? What if everything you do is constantly monitored?

You can resist.

Unfortunately, this really is the state of the crypto industry and there aren’t enough people joining the fight for privacy protection.

Transparency and data protection

When I first read the Bitcoin (BTC) whitepaper in 2011, I fell in love with the vision of a peer-to-peer e-cash system. Most societies have physical cash – legal tender – so what is the physical cash equivalent in a digital society? Satoshi Nakamoto seems to have come up with a great answer to this question and a trillion dollar market has sprung up around her. Unfortunately, Satoshi’s original idea fell short in at least one area, and that was privacy.

Legal tender is private. When someone exchanges coins or bills (also known as “bills” in the United States and Canada) for goods or services, only the two parties involved are aware of the transaction. Requires identification if goods or services are restricted to certain age groups (beer is not for everyone). Also, if you give the woman a $ 10 bill at the local farmers’ market, she won’t be able to see how much you have left in her bank account.

However, transactions on the Bitcoin blockchain are completely transparent. This means that the transaction amount, frequency and balance are public to the entire public. The Bitcoin whitepaper only devotes half a page to the subject of data protection with suggested solutions that do not always work as intended, especially with second-generation account-based blockchains such as Ethereum.

There are user guides on how to get more privacy with Bitcoin, but they are extremely complicated and often recommend the use of tools that can be dangerous for users. There are also some blockchain networks that are designed with data protection by default, but most do not support more complex programmability such as smart contracts, which enables new use cases related to Logic.Business in decentralized finance (DeFi).

Related: DPN vs VPN: dawn of decentralized web privacy

Leave privacy

Why is the blockchain community failing to make data protection a top priority? For a, Data protection was referred to three other priorities: Security, decentralization and scalability. Nobody would argue that these three components are not important either. But are they mutually exclusive in terms of privacy?

Another reason privacy isn’t a priority is It’s very hard to guarantee. In the past, privacy tools like zero-knowledge proofs were slow and inefficient, and scaling them was hard work. But just because privacy is difficult, does that mean it shouldn’t be a priority?

The last reason is perhaps the most worrying. There’s a myth in the media that Cryptocurrency transactions are completely anonymous. You are not. This means that many people are actively using cryptocurrencies under the mistake that their transactions are private. As the tools for analyzing blockchain networks become more sophisticated, the lack of anonymity will increase. When is data protection important enough to prioritize?

Related: Bitcoin can no longer be viewed as an undetectable “criminal currency”

Financial privacy

A friend of mine, who has been working full-time in the crypto industry since 2015, recently asked me: “Is WTF PriFi?” PriFi or “Security Finance” is the confirmation from the crypto industry that we take data protection seriously. We have gotten into such trouble that after 12 years of developing this industry, we have now reached the point where privacy is important enough to have our own hashtag.

So where do we go from here to create more privacy, protect everyday crypto users and achieve digital privacy equal to cash?

The first step is more education. As society becomes more and more digital, it becomes more and more difficult to achieve privacy. This starts with educating the media about the difference between secrecy and privacy. The secret is not lacking whoever What you should know. I don’t want privacy the whole world What you should know. Confidentiality is a privilege. Privacy is a right.

The next step is to simplify privacy. Achieving data protection in crypto shouldn’t require sophisticated solutions, dodgy tools, or in-depth knowledge of complex cryptography. Blockchain networks, including smart contract platforms, support optional data protection that is as simple as the click of a button.

The last step is to protect privacy. Data protection is a topical issue. The latest U.S. infrastructure bill includes a provision that extends Section 6050I of the Tax Code, requiring individual partners to collect their personal information for cash transactions over $ 10,000 and apply it to cryptocurrencies. The Coin Center, a non-profit advocacy and research group for cryptocurrencies, is preparing to question the constitutionality of this cryptocurrency change. You can stay here too.

Equipped with the right education, intuitive user experience and the motivation to prioritize data protection in cryptocurrencies, we can protect our rights without carelessness and maintain adequate data protection on our own terms.

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