The author of this article is Paul Bleak (AKA 'pbleak').
Recent news have provided possible evidence for something every self-respecting post-Snowden internet-user has long-suspected. No, not that the government has taken a keen interest in Bitcoin. We already know they have. Rather than corporations that facilitate the use of Bitcoin are beginning to mirror their FIAT cousins in monitoring consumer behaviour. Users on popular discussion site Reddit have been complaining about bans from Coinbase relating to the use of gambling sites, but perhaps the more shocking reason is the use of localbitcoins as a reason to have an account blocked. What links these events is, quite simply, the fact that Coinbase must be monitoring these accounts in order to ascertain what their users are up to. This is, it must be noted, broadly explained away as ensuring the site remains compliant with regulations (since it is located in the United States). However, what this begins to look like, at least to those of us in the cryptocurrency community, is regulation.
Now we have long been aware that banking institutions keep detailed profiles of our both our financial situations and that corporations develop extensive (and shareable) profiles about our consumer spending and patterns of behaviour. Often we are not in a position, unless we refuse to have a bank account, to avoid this, as with banks. With corporations, we are more likely to hand over our details, through loyalty cards and schemes, or blindly accepting terms and conditions.
Now the structure of Bitcoin has an implicit manner to track users in the same manner, since the blockchain is both public and very closely linked to an identity when a user is using Coinbase as the latter requires verification. This means Coinbase begins to represent something close to a Bitcoin bank account or, at least, a database of sorts. It should not come as a surprise, then, that the company engages in tactics used by those that use FIAT currency. This is the nature of our Big Data culture, centralised to its core as applied to Bitcoin. It is for this reason that users seeking to disconnect from the centralised net ought to look at alternative cryptocurrencies such as Dash, which allows for a truly anonymous and decentralised experience through the use of its DarkSend technology. Used in conjunction with other anonymising tools, it fulfils the promise of a currency that is properly untrackable thereby regaining the user the freedom that Bitcoin had once seemed to deliver.
Furthermore, the Coinbase story is surely only the beginning. Recent years have demonstrated that once we enter a state of centralisation online, government and corporations revert to type, i.e. to constructing patterns and profiles of online users. It is imperative that those of us who embrace privacy practise what we preach by deploying those technologies and decentralised tools that carry our core values intrinsically. Of these Dash remains one of the few remaining options in an increasingly centralised cryptocurrency world. As they say in their community, it might be time for Coinbase users to ‘get into the Dark.’