This article bounces around a bit as it explores all the ways we are about to lose our privacy due to crypto and CBDCs. While I understand the author’s angst, after all I grew up in the late ’60s, the fact is that 20+ years working in payments has tempered my perspective on privacy and freedom. Freedom from the man gives every individual that wants to become a criminal online the power to do so with almost no mechanism to gather proof which could be used to bring that person to justice. In fact, the global scale of the internet and the geographically fractured justice and political systems have already accomplished much of that.
So as I’ve written here, here, here, here, here and here; I believe in crypto and NFTs but I also believe we are entering a dark time where online identity remains too murky, which enables an extraordinary amount of crime on the unsuspecting. Assuming the vast majority of users have the wherewithal to understand technology and protect themselves is ignoring the obvious truth. The majority of people need law enforcement and our justice system to keep the idiots in fear of being caught. If the current insanity around NFTs doesn’t make that clear, nothing will:
“It turns out that the cryptocurrency does not, in fact, guarantee anonymity. Users’ digital identities can, with some effort, be connected to their real identities. Moreover, in an ultimate irony, the revolution that bitcoin started might end up destroying whatever vestiges of privacy are left in modern financial markets. As the technology goes mainstream, it threatens to give big corporations and government a better view into our financial lives and greater control over how we spend our money.
Bitcoin’s reputation as a tool for shady dealings is perhaps overstated. While it has played a role in allowing hackers to obtain payoff money for ransomware attacks, this requires a level of technical sophistication beyond that of most garden-variety criminals. Bitcoin’s use in transactions that once fueled the “dark Web,” where unsavory and illicit commerce is conducted, has fallen sharply. The Russian government can scarcely count on bitcoin to evade the sanctions levied for its war in Ukraine — after all, payments for international transactions still need to be settled in real money such as dollars or euros.
Still, the ability to conduct secure, somewhat private financial transactions helps explain cryptocurrency’s growing appeal. That’s largely thanks to its groundbreaking blockchain technology. A blockchain is, in effect, a digital ledger of transactions or ownership records. The bitcoin blockchain contains a publicly visible record of all transactions ever undertaken using this cryptocurrency: the dates and amounts, as well as the digital — but not real-life — identities of the transacting parties.”
Overview by Tim Sloane, VP, Payments Innovation at Mercator Advisory Group