2024-5-6 00:07 |
Renowned fugitive CIA whistleblower Edward Snowden has issued a stark warning regarding the future of privacy within the Bitcoin network.
In a tweet on May 3rd, Snowden voiced his concerns, stating, “I’ve been warning Bitcoin developers for ten years that privacy needs to be provided for at the protocol level. This is the final warning. The clock is ticking.”
Snowden raised the warning in response to an announcement by zkSNACK, the developer firm of the Wasabi wallet, via a blog post in which the company revealed its decision to discontinue its “conjoin coordination service” effective June 1st, 2024, after “years of relentless dedication to improving Bitcoin’s privacy.”
A CoinJoin coordination service” is a technology that allows multiple Bitcoin users to combine their transactions, making it difficult for others to track the source of the transactions, more like what crypto mixers do.
The decision by zkSNACKs, according to their blog post, was made with a heavy heart and after careful consideration, citing the need for legal clarity in their operations in the US. The blog post, however, reassured users that Wasabi Wallet will continue to function as a regular Bitcoin wallet, albeit without the coinjoin feature. However, zkSNACKs emphasized that while Wasabi Wallet’s client-side filtering architecture, Tor integration, and custom coin selection enhance privacy, complete privacy remains unattainable without coinjoins.
Notably, the announcement from zkSNACKs follows recent regulatory actions in the United States, where self-custodial cryptocurrency wallet providers have come under scrutiny. Phoenix Wallet and Wasabi Wallet are among the latest to exit the US market in response to the regulatory crackdown sparked by actions against Consensys and Samourai Wallet.
Concerns regarding the regulatory landscape for self-custodial wallets were heightened after Metamask wallet developer firm Consensys received a Wells notice from the U.S. Securities and Exchange Commission (SEC) and the co-founders of Samourai Wallet were arrested on charges of money laundering. The developments have instilled fear among crypto service providers operating in the US and received condemnation from the crypto community.
That said, Snowden’s latest warning echoes his previous defense of crypto privacy, particularly in light of the U.S. Department of Justice’s (DOJ) crackdown on Samourai Wallet last month.
“The Department of “Justice” has once again criminalized the developers of an app that restores financial privacy. The way to fix this it to make money private by default. Privacy must never be “exceptional,” or they will make it criminal,” Snowden had tweeted following the crackdown.
Notably, while European regulators have taken a more relaxed approach to potential regulations concerning self-custodial wallets, concerns about the future of privacy within the Bitcoin network persist, particularly in the US.
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