In the crypto industry, few things are as sacrosanct as the privacy of your transactions. That doesn’t mean they’re always anonymous: as Robert Mueller’s long-anticipated report detailed, Russian hackers interfering in the last U.S. presidential election used Bitcoin – which is about as traceable as it gets in crypto.*
So when the portfolio-tracking app with the largest user-base in the world, at five million downloads, introduces a way to connect your phone to your exchange account at no charge… is it time to start expressing some concerns?
Ed Moncada, CEO of Blockfolio, responds forcefully to that question.
“To put it bluntly, no – in fact we’ve deliberately avoided requiring KYC, or AML, or any of the things that would require us to capture your personally-identifiable information.
Moncada points to the launch of a ‘Privacy Philosophy’ the company created last month, explaining that the company’s approach was codified in response to both the demands of its users, and the perceived over-reach of Big Data companies.
With the possibility of major tech incumbents like Facebook entering the crypto space, Moncada believes “The rules of the game are totally different in a decentralized ecosystem where the technology and principles are around trustlessness. As big data enters crypto I won’t be surprised if some of them miss the mark.”
Subpoenas Are Becoming Part Of Crypto Business
Like others in the crypto space, Moncada explains, the company has had to deal with subpoenas related to user data.
“Look at Kraken or ShapeShift. You’ve got an exchange that is literally saying, these subpoenas are creating a barrier to entry in the market, they’ve tripled or more in a year. You’ve got Erik Voorhees saying they had to deal with 60 separate law enforcement inquiries last year.”
But, says Moncada, that’s exactly the reason that Blockfolio has taken a different route.
“We’ve dealt with three of these so far, and in each case the subpoena was dropped because we simply couldn’t provide what the issuers were looking for.”
So What’s The Point Of Exchange Integration?
With all the fear around data privacy, the question Moncada really wants to answer is – why bother?
“Because crypto is still too difficult,” he says. “Everything about it needs to be frictionless, but instead we’re dealing with private keys and separate wallets, and trying to track multiple exchanges and trades. The whole point of Blockfolio is to take some of that pain away, so that people have a better experience of the whole process. And so long as we can do it without exposing our users to risk, we’re going to offer them that feature.”
So far, the Blockfolio 2.2 integration will work with Binance, Bittrex, Coinbase, Coinbase Pro, OKEx and Poloniex: and KuCoin, HitBTC, and Kraken are already in beta testing.
Learning From Big Data’s Mistakes
The cryptocurrency market has changed over the last eighteen months. The fervor surrounding the sector has died down as the astronomical gains of 2017 have been erased, and new entrants are more hesitant to commit to the sector.
But, as has been pointed out repeatedly by crypto bulls, the time since the bubble burst has been spent building a stronger, better, safer market – and products to match.
The Big Data industry is now facing international scrutiny over the collection, analysis, and dissemination of your information. Moncada is hoping that as crypto evolves, it learns some of the lessons that the tech giants are only now confronting. And unlike the ever-penitent Facebook, Moncada is happy to make his feelings on privacy unequivocally clear:
“To be very clear here: we have never, and will never, sell your personally-identifiable or individual portfolio data,” he explains.
Sounding just a little like the WOPR computer learning about a nuclear Armageddon in the 1982 movie ‘War Games’, Moncada sums up Blockfolio’s privacy philosophy succinctly:
“The safest way to protect our users’ data, is not to know who they are.”