Cryptocurrency exchanges are no stranger to controversies. Be it money laundering or misleading ads, crypto exchanges have a lot to be accountable for. However, the decentralized ethos of the crypto community puts privacy and confidentiality at the top of the priority list. In a recent chain of events, Coinbase was accused of breaching this fundamental principle by sharing geolocation data to the ICE – Immigration and Customs Enforcement – a federal agency under the U.S. Department of Homeland Security.
As things happen on Twitter, news of Coinbase sharing confidential user data with the ICE spread like wildfire. Many prominent Coinbase users spoke against it, threatening that they’ll leave the platform. Solobase Mac took to Twitter to write that Coinbase users did not sign up to have their data shared with the ICE.
Less than 24 hours after the event, it turns out that the accusations were false. To be more precise, the accusations were lies by the omission of facts, rather. Here’s what’s really going on with Coinbase and the ICE:
As a US-based company, Coinbase is liable to share criminal information with any homeland security unit. Not just Coinbase, any company operating from the United States is bound to do so. Coinbase also shared user data, but only of those users accused of terrorism financing and money laundering. As far as the average Coinbase user is concerned, there’s nothing to worry about. Your data is safe with Coinbase, and it does not share it with any third party. However, it is worth pondering that at a time when Facebook and other tech giants are openly selling user data, why do crypto exchanges continue to be under much harsher scrutiny?