Cryptocurrency Regulations: Wallet Privacy and Anonymity remains important.

Cryptocurrencies continue to make progress towards mass-adoption, heist continue to remaining relatively high and governments around the world seemingly unable to discourage its adoption; many governments are turning towards cryptocurrency regulations as a means of retaining financial control of their national space; invariably this also means an increase in data and information collection to meet regulatory benchmarks. More collected data on you and about your crypto activities exposes you to crime.

Although governments across the world make the argument that as long as cryptocurrency continue to use stablecoins (i.e cryptocurrency that draws its value and stability by being backed by Fiat currency reserves) then they must be regulated because of their possible impact on banks and the fait currencies from which they draw their value-Hmmm; I would add that, the Crypto space continues to invite regulations to itself with near daily heist and hacks to the tune of millions of dollars; So regulations are definitely coming, and more data collection about your crypto activities.

Standard Financial Regulators Data Collection Request: KYC, AML,

Regulators can request for any information about you to be collected and stored as long as this is legal; some standard regulators data collection include KYC and AML, and crypto services providers may be required to follow this 

1.       Know-Your –Customer (KYC) which means gather all identification information about a user/client/customer so as to be able to tell each person uniquely from the other.

2.       Anti-Money-Laundering (AML) which means know the details of the transactions so as to be able to tell who did what, when , how and what value and store same for a period of time.

What this means

The sum of this is that, an era of where your crypto activities will be subject to more data collection approaches; and this has implications including

1.       The potentials for more data availability for crime fighting, and apprehending bad actors

2.       OR as has often happened; poor data management has often led to data breaches which are then used to perpetrate crime, so users could end up being more exposed than protected.

Maintaining Privacy and Anonymity in a Regulated Crypto Market

Yes maintaining privacy and anonymity in a regulated crypto market remains important, one way to maintain privacy and anonymity will be to use services that does not have the ability to gather user data; how will that happen if the regulator insists on data collection right? It’s important to note that generally, regulators are less concerned about your privacy and more concerned about your anonymity.  Privacy and anonymity could be maintained by -

1.       Using crypto privacy focused products and solutions such as BlockWallet, who use Zero-Knowledge proofs like zk-SNARKS to ensure the privacy of your crypto activities.

2.       This does not mean that the service providers does not know details of your internet data and so still have some info albert to a lesser degree.

3.       To make all your internet data also private, you will have to use crypto privacy focused solutions that have integrated privacy focus internet provider/browser like Tor.

4.       This combination protects both your privacy on the blockchain as well as protect your internet activities and data such that, even your crypto wallet providers do not have the entirety of your activities and at best can only provide incomplete information.

This may seem further provision of cover for criminals- far from it, think about it like this, there are good intentioned people that genuinely want privacy and anonymity; also there are many possible good outcomes from this, including

1.       Reducing crypto crime; because criminals have less access to the information they need to perpetrate crime this will translate to less crime in the crypto space and a correspondent increase in credibility. Access to wallets has been a big source of Crypto Crime.

2.       Good people, who do the right things and who sincerely want privacy and anonymity, will be able to use crypto more comfortably leading to more crypto adoption.

3.       Recent developments have shown that Crypto has a very large percentage of bad actors, including service providers, criminals etc. So you are best protected from all kinds of bad actors.

BlockWallet working on TOR integration.

BlockWallet’s goal is to have zero information on users, and they aim to achieve this by working on features such as TOR integration to allow our users to completely protect their data even from BLOCKWALLET. This means if BlockWallet has no information or data about you there is nothing to share or to be manipulated, there is simply nothing we can help with even if they get asked.

About BlockWallet

Reclaim your financial privacy on blockchain

BlockWallet uses privacy-enhancing smart contracts to make your crypto transfers as private and secure as bank transfers, this is important because, you leave a trail of digital information on the blockchain. Anyone can find it and see what DApps you’ve used, transfers you’ve made, and the crypto assets you hold. What BlockWallet does

1.       Protects Your Finances:- Your finances are a personal matter, and so you don’t have to reveal your balance and transaction history when making bank transfers. BlockWallet enforces these same fundamentals on blockchain and render your funds untraceable to everyone but you.

2.       Your protected gateway to Unlock the full potential of Web 3.0, BlockWallet is your gateway to the decentralized web. Explore Web 3.0 with privacy-enhancing smart contracts at your fingertips. Connect to any DApp, across multiple chains.

3.       Take back control of your data: BlockWallet empowers users by giving them full control of their digital assets. As a non-custodial wallet that collects no data whatsoever, you’re always in the driver’s seat.

CAVEAT:

1.       Note- This is not a financial investment advice.

2.       All financial investments  involve risk DYOR (Do your own research) before making any financial investments

3.       This article are my thoughts and opinion about the subject matter.

References

1.       Kumar,A. XRP Lawyer Predicts SEC Will Come After Crypto Exchanges Next. (2022,04,02). https://coingape.com/xrp-lawyer-predicts-sec-will-come-after-crypto-exchanges-next/