An extremely unsettling development regarding the infringement of privacy may be upon everyone involved in the cryptocurrency space, especially for those who use regulated cryptocurrency exchanges and custody services like Coinbase, the popular US-based cryptocurrency exchange.
As reported by CoinDesk, the Financial Action Task Force (FATF) is releasing new rules pertaining to cryptocurrencies and how exchanges and custodial services serve their customers.
These new rules will likely require crypto exchange and custodial services to obtain identifying information on their customers before allowing transactions on their platform.
Using Coinbase as an example, CoinDesk states:
“If you hold your coins with Coinbase, you will no longer be able to send or receive crypto to or from just any old bitcoin address if it has been through a KYC process. Once you move your funds into a non-custodial account, you’ll be free to send them to any self-custody address, but if you’ve never formally associated your identity with that address via a regulated entity, you won’t be able to transact with a Coinbase address or one administered by any other regulated custody provider.”
Total Control Over Who Transacts with Whom, How Much and How Often
These new rules by the FATF are a nightmare for privacy advocates, who view them as a descent into a totalitarian way of controling the flow of digital currencies. With the collection of this identifying information, governments and organizations will have the ability to know who everyone is transacting with, how much, and how often.
They’ll be able to plug this information into artificial intelligence and catalog social connections on an unprecedented scale, and it’s obvious why many are concerned about the potential for misuse.
As one deeply concerned crypto enthusiast and privacy advocate stated in a Reddit post:
“Stop giving it [artificial intelligence] your data. Unless we are to become digital cattle, this must be resisted with all our might. If you don’t care about this, you don’t understand the grave danger in having the government and its friendly big corporations knowing everything about everyone. You should come to care about this, and you should come to understand this before it’s too late.”
In light of these new rules coming to crypto, will we see more unregulated crypto exchanges being used to preserve privacy? Let us know what you think in the comment section below.