One of the unique things about cryptocurrency operations is anonymity. As a result, investors, traders, and participants enjoy transacting without fear of exposure to third parties and government agencies.
That’s why even scammers or cyber criminals utilize crypto to perpetrate money laundering activities and other financial crimes. Even though exploiting the mechanisms of crypto operations is unacceptable, anonymity is a feature to appreciate.
But all that might change for Coinbase users, which currently are over 89 million. The digital assets exchange currently faces backlashes from aggrieved crypto users on its platform. A recent report reveals that its analytics program, Tracer, will disclose user data to the US Immigration and Customs Enforcement Agency (ICE).
Many Coinbase users took to Twitter to air their grievances on the issues. Some have stated that they didn’t sign up for their identities to be revealed to the US Homeland Security. Other users maintain that Coinbase will pay them for selling out their data without informing them.
Coinbase signs a three-year contract with ICE
The crypto firm signed a contract with the US government through the ICE arm of Homeland Security. The ICE focuses on protecting the US from illegal immigration and cross-border crime.
According to the report, the ICE will access transaction history and geotracking data. By using Coinbase Tracer, the agency can identify the real-world owners of crypto addresses. This contract between Coinbase Tracer and the ICE will supposedly last for three years and start at a sum of $455,000 but is expected to reach $137M by 2024.
Tech Inquiry, a nonprofit organization known for tracking relationships between nonprofits, companies, and governments, acquired the contract. The firm usually tracks collaborations related to weapons, surveillance, corruption, inner workings, contracts, etc.
Coinbase denies selling users’ data to ICE
The report on the deal emerged on June 30. When Coinbase was asked to make statements about the controversy, its spokesperson Natasha LaBranche simply provided a link to the official website. The links state that Tracer doesn’t use Coinbase user data but gathers its data via public sources.
Fast-forward to July 1, Coinbase released a statement clarifying the deal between the company and ICE. In addition, the firm has denied the accusation of selling users’ data to Homeland Security.
According to the company, the access to its Tracer tool is mainly for financial crimes investigations. It is not selling proprietary customer data. Coinbase reiterated that it prioritizes users’ safe and secure access to its platform above everything else.
Regarding Tracer Tools, the firm stated that they were developed to meet government requirements. The tools gather data to investigate financial crimes such as money laundering and terrorist financing.
Coinbase also clarified that the information the ICE gets from the tools is from public sources and not its users’ data as feared.
How can a user protect their Geo-location data?
Even though Coinbase has assured users that their data is safe, there are other ways your locations can be tracked online. But you can prevent all those unwanted tracking by doing the following things:
- Using a Virtual Private Network (VPN) to access the web. A reliable service masks your location by encrypting your data and passing your traffic through remote servers.
- Turning off or clearing cookies after browsing
- Using anti-tracking software to block tracking websites
- Sharing limited information on social media networks
- Monitoring DNS leakages and Managing plugins
- Learn more about security protocols