The way data and technology is now being used means that our privacy is under increased threat and on a scale that we couldn’t have imagined 20 years ago.
The ways in which we can be tracked and identified have exploded, alongside the types and scale of information available about us.
Thanks to this, everything you do is tracked, especially anything you interact with digitaily. This creates a new normal where we do not have privacy anymore.
Our justice system treats us all as innocent until proven guilty. When the government wants to spy on our daily activities and private conversations, then law enforcement needs to go to the court with a level of proof that there is a good reason for suspicion.
Good news, with all the current tracking done of you, often companies will just hand over data to law enforcement if they ask for it even without a warrant, so now we can all be treated as guilty and have to prove our innocence.
Privacy used to be regarded as a basic human right, I guess this is not something we have to care about any more as there is no privacy in the digital age.
Well I have done nothing wrong, so I have nothing to hide
The “nothing to hide” argument mistakenly suggests that privacy is something only criminals desire.
It is a great piece of propaganda because if people believe this and hold on to it, it means that companies and the government have the freedom to keep us under surveillance and if we even consider there is something wrong with this, then we must have some criminal intent.
This leaves us with no right to complain about our privacy being completely trampled all over. Governments and companies are free to use this information any way that they like.
Often we are asked to accept policies that ask to trade privacy for greater convenience or perceived security: This could be from smart home devices, to facial recognition scans at the airport, to endorsing legislation such as the Patriot Act.
Much like the right to protest, our privacy is something we notice only when it’s taken away from us and then used against us.
Throughout history, seemingly innocent information about people has been used to persecute them during moments of crisis.
These different bits of information can individually, in isolation, seem like they are nothing and not something to worry about, when you start to collect it into a database and link it together it can start to show information about yourself that you never could have guessed at.
We have trusted these companies/government who are collecting this data that they are not doing anything dishonest or abusing the information. You are trusting that the people who are collecting your data are not doing anything dishonest with your data and have your best intentions.
But what happens to this information if there is a change in the political landscape and then it changes, it shifts dramatically to the left or the right?
In these situations authorities could use the gathered data to find and crackdown on groups that disagree with them, use the information to target journalists, persecute activists and discriminate against minorities.
Having our society constantly under government surveillance can produce long lasting social damage. If people are just a little more fearful, a little less likely to freely associate, a little less likely to dissent, added all together can make us a less free and open society.
With a lot of the information it is not easily accessible, often totally hidden. Tracking is a complicated process and to generate some type of error is possible. The government often likes to make decisions and hide information, calling it for our protection or National defence.
This does not give the ability to correct that data or know how it is being used against us. We also can not make sure the information the government uses is accurate to make sure they are coming to the correct conclusion.
Why do companies track and get as much data as possible?
The main reason is simply greed, they want to make as much money as possible.
The other reason that some businesses gather information about you is not because it is a direct benefit to them, it is that they are forced by legislation (the government where they are operating from) to get easy access to your data in the name of protecting consumers.
The companies want to make sure that they follow the legislation so they do not get fined (protect their money) or do not get shut down (so they can keep making money).
The ways that the company can make money off this information is:
Targeted Ads
As a lot of products are free, they make their money from running ads on their site and in their products. By getting the ads to perform better means that they are making more money and it is a better experience for the consumer.
With the rising adoption of machine learning, marketers are using algorithms to predict consumer behaviour and thereby more accurately target ads towards specific individuals.
Machine learning can be used to uncover details such as sex, religion, age, political beliefs and other personal information without the user ever revealing that information themselves.
Users that are subjected to behaviour-based advertising are more likely to buy something because they will be seeing more things that they are directly interested in. This because the message is more focused on that person’s demographics, who they are, what they like and what they are most likely to purchase.
Websites and digital platforms can gather such information from users’ digital footprints and their behaviour on the different interactions you are doing with the company and where they can get information about you.
It is similar to how the algorithms in social media work.
Privacy concerns over how targeted ads use tracking information has given some users the feeling like they are being stalked and constantly being watched, so companies then look at ways of putting in non relevant ads so that consumers do not notice at the conscious level of how well targeted the ads are for them.
Improving the user experience
Similar to how targeted ads improve the user experience because it is more targeted to the user’s experience. Using that data to change how the users experience the site giving the user a better experience and improving how much they sell.
What about when it comes to buying and selling crypto?
In the early days of crypto the only way to get bitcoin was to mine it yourself, these days it is near impossible to be able to get bitcoins from mine it yourself. The main way to get bitcoin and other cryptocurrencies now is through an exchange.
The exchange has become the on/off road of switching between crypto and fiat money. This is why they are the target of regulators who are putting pressure and penalization if the exchange does not comply.
The regulators see that controlling who can exit/enter crypto then the regulators/governments know what is going on and have more control.
If it was just the exchanges or the way different cryptocurrencies currencies affected your privacy then you could easily use a different one that fitted how you wanted your information to be used.
But the exchange/crypto currency is not really what is affecting your privacy when it comes to buying and selling crypto, it is the regulators that have the greatest in pact on our privacy.
There are 3 main regulations that exchanges have to follow and all 3 impact on your privacy. The exact details of each will vary and certain details will be slightly different based on the country where the exchange is operating.
The 3 main regulations are:
The Bank Secrecy Act (BSA):
This act was originally passed by the U.S. Congress in 1970 and has been updated and expanded over the years. This requires banks to report any suspicious transactions involving sums of money in excess of $10,000.
The argument at the time was that it would not affect the privacy rights of people in general as it was a reasonably high amount.
You might think that $10,000 USD is a lot of money, but that $10,00 USD was not indexed to inflation so $10,000 USD in 1970 would be worth $76,000 USD in 2022.
Not indexing it to inflation means they are dropping the value each year without having to get anyone to approve the change and more and more people are going to be caught in it as inflation keeps reducing the value.
Know your customer (KYC):
This is where an exchange is obligated to carry out certain identity and background checks on the users before they can use its product or platform.
Often you have to provide a government issued ID, where you live and a photo of you, so they know exactly who you are. The exchange also has to keep that information for as long as you are a customer and for another 5 years after you stop using their services.
The idea is if there is a crime where someone acquires crypto then they want to be able to identify who switches between crypto and fiat.
Travel Rule:
When a transaction is over a certain threshold (Sometimes $3,000 USD but more often $1,000 USD depending on countries implementation) then the exchange will need information about where the money is being transferred too. who it is going to and then send the information about the sender to the destination so they know who is sending the money.
There are some checks on who the crypto is being sent to, if everything is fine then the crypto is sent with the information about the sender. This will mean that the destination exchange will now have your details.
To be able to fulfil the requirements of this particular regulation, the exchange will have to have done KYC on you so they can pass on those details to the target exchange.
This rule comes from the banking world where the regulation was designed for bank to bank transactions. This has been placed on crypto exchanges, without caring about the nature of crypto and how it functions differently than a bank to bank transaction of fiat currency.
As this does not directly translate, there are different problems with trying to force it on exchanges that have not been fully worked out yet. For example blockchains are not designed to send personally identifiable information alongside transactions. So more work needs to be done here.
How do these regulations hurt individuals’ privacy?
There is a lot of propaganda around how these regulations make things better and that these regulations are a good thing for the crypto industry.
For example, these financial regulations help provide a safe and crime-free environment for businesses to thrive. That Money laundering and other scams are less likely to occur. That vigorous identity verification can significantly reduce fraudulent activity and improve market reputation.
In truth the main reason that scammers like crypto is not because of the lack of restrictions. It is because it is a more effective method of transferring value around the world, so if it can make it more burdem and harder to use then scammers and other users will not want to use it.
Often these regulations are just an excuse to destroy privacy, if I want to just try bitcoin to see how it works to buy something with it to see how it works, then I have to give a lot of personal information to the exchange. For any small amount of money there is no justification for this.
The easiest way to keep something secret is never to share it in the first place. The information that is given to these exchanges can then be passed on to the government or other exchanges with no direct oversight to how that data is kept safe or how it is being used.
We are meant to give up our own private data but how they use it for them to keep private.
There have been plenty of data breaches of large companies. Forcing the exchange to hold this information makes them a target to be attacked.
So that this makes the consumer safer is a complete lie, it actually makes us more vulnerable.
Could you make a donation to a political party and now that information is in the government where they can use that information against you.
There is also a huge burden put on these exchanges. Collecting, maintaining, protecting this data. Having staff trained on how to manage it, what to look for so they can make sure they report if there is anything suspicious.
If the exchange gets anything wrong then there are huge fines from the regulators, or they can be shut down, so they are more likely to be extra zealous in making sure they have as much information as possible.
Does this actually reduce crime at all or just make it move difficult so it moves to a different location and the general user and the exchange is hit with extra costs and risks?
Are there any valid cost-benefit analyses done with these regulations?
Or is it just to strip away everyone’s privacy and hope to catch someone doing the wrong thing with no care about the end users privacy?
Could there be better ways to detect crime without destroying people’s privacy and putting these burdens on the exchanges.
Why Privacy actually matters
Like breathing air, it is something we do and take for granted and often give it no thought at all.
Every day we do things in our homes that we wouldn’t do in public. Sing in the shower, make love, confide in family and friends, explore ideas, challenge beliefs.
We have fences and curtains as a way to create a boundary around our personal space where we are free to be ourselves.
Privacy is about the freedom to make choices without fear, how we want to live, what we believe in, who we are friends with, and what you want to share with whom.
A lack of privacy leads to uniformity and self-censorship, which pushes our opinions to the edges and erodes our ability to engage in healthy debates.
Ultimately, privacy also protects us from the unknown.
Circumstances change. Something that can be harmlessly shared today may someday be worth concealing, whether its political beliefs, or your ethnic or religious background.
Privacy is the ultimate insurance against a rapidly changing corporate and political climate. Once we lose our privacy, we won’t get it back.
Evidence also suggests that knowing we are being monitored changes our behaviour. As we become more aware of the computer algorithms and databases used to predict behaviour and use that information, we will become more wary of what we say and do online.
We will start to avoid saying or doing anything controversial, in case it is misconstrued. As a result, societies will become very conformist, with no-one willing to challenge the status quo.
Privacy gives us choice, it gives us the freedom to decide who we tell what, to establish boundaries, to limit who has access to our bodies, places and things, as well as our communications and our information.
It allows us to negotiate who we are and how we want to interact with the world around us, and to define those relationships on our own terms.
Privacy is how we seek to protect ourselves and society against arbitrary and unjustified use of power, by controlling what can be known about us and done to us, while protecting us from those who aim to exert control over our data, and ultimately all aspects of our lives.
It gives us space to be ourselves free of judgement, and allows us to think freely without discrimination.