Bitcoin and the market of revealing personal data. Micro-violations of privacy as payment. Cryptocurrency enabling switch to money payments while preserving privacy. The vulnerability of personal data collections, the dangers of KYC ("Know Your Customer"). A talk about privacy, identity, surveillance, hierarchies and the future of network-centric private and secure money.
Transcript
[AUDIENCE] We have a question [that has been asked] several times. He wants to know your opinion about... centralised systems on the Bitcoin network requiring personal data for usage, and what the future of that is. [ANDREAS] Yes.
I think most of my talk was about this, but I will focus on the "requiring personal data" part. Revealing personal data is not simply a matter of a totalitarian financial surveillance system; it is also a market economy, the [current] system of micropayments on the internet. If you want to buy any content that is effectively priced less than five dollars, the price you pay is a micro-violation of your privacy. That is the micro payment system we have on the internet [right now].
You give your data to be consumed, analyzed, and statistically correlated so that the message... you receive is narrower and narrower, conforming more to what Facebook thinks you want to hear, to what Amazon thinks you want to buy, etc. We pay these micropayments through the micro-violations of [our] privacy. Our private data is the price of entry into the micro- economy, but we can do much better than that.
As we develop micropayments on top of network-centric currencies, we can pay with currency instead, while retaining all of our privacy. Bitcoin doesn't require you to identify yourself. That is not a bug, that is a feature. Bitcoin makes it very difficult to overlay identity on top, [opposed to] the blockchains that banks want to build.
It is not secure when you concentrate personally identifiable information. You will be hacked. We have not found a way to secure data [of that scale]. Nobody can.
Citibank can't secure data. Large internet retailers can't secure data. The NSA can't even secure its data. The idea that some Bitcoin startup, with Know-Your- Customer (KYC) and anti-money laundering (AML)...
collecting all the personally identifiable information, [will protect it], is both ridiculous and disastrous. That information will leak. You will lose your privacy once again. Bitcoin does not do identity because that is [an intentional] and very powerful part of the design.
It is the foundation of having privacy and anonymity, just [two of our] human rights.