Crypto exchange Coinbase has been in the news several times recently, and not in a positive way. First, the company had to emphasize that your tokens on the exchange are just safe, and that bankruptcy is not around the corner. Now Coinbase seemed like your location sells to the US government, but the company denies this.
Strange situation at Coinbase
The Intercept wrote two days ago that Coinbase passes on users’ geolocation to the Immigrations and Customs Enforcement (ICE) in the U.S. The abbreviation ICE should not be confused with the financial services company of the same name. A legal document confirms that it is indeed about selling your location to the US government.
The document mentions Coinbase Tracer, a series tools with which you can track transactions on different blockchains and link them to other transactions and wallets. Along with the identification requirement of accounts on exchanges to be so this is the ideal surveillance tools† There is support for a few dozen blockchains, including Bitcoin (BTC), Ethereum (ETH) and Tether’s USDT. ICE would have gained access to this now.
The information surrounding the sale of location data is a lot more unclear. It is unknown whether this data comes from the Coinbase trading platform or if it comes from elsewhere. The software is for general use with cryptocurrencies, not just for the trading platform.
Coinbase denies
Highlighted on Twitter Coinbase that it sells your customer information to users. “Our first concern will always be to provide the most secure crypto experience to users,” the company states. Furthermore, the tools are said to have been developed to comply with regulations related to crime, such as money laundering and terrorist financing. “The data comes from public sources and does not use Coinbase user data,” Coinbase points out. So the tool will cost money, not the user data.
1/ We want to make this incredibly clear: Coinbase does not sell proprietary customer data. Our first concern has been and always will be providing the safest and most secure crypto experience to our users.
— Coinbase (@coinbase) June 30, 2022
Yet it is remarkable that location data is mentioned at all. After all, the information has to come from somewhere. It is quite possible that a law will be passed in the near future that will make it mandatory for exchanges to pass on this type of data. After all, many apps and websites also use cookies, which was not the case not so long ago.
