Bitcoin’s biggest flaw is its lack of privacy, said Edward Snowden at the Bitcoin 2019 conference.
The cybersecurity expert noted the importance of privacy as a source of liberty.
“The lack of privacy is an existential threat to bitcoin. Is the only protection users have from political change,” Snowden said.
Snowden also stated that he was a bitcoin supporter and even used an encrypted service that he paid for with bitcoins in order to communicate with journalists in 2013.
Threats to and From Exchanges
Talking about his experience being pursued by the United States government for sharing NSA data, Snowden pointed out the unrealistic expectations from regulators who want to be in control of cryptocurrencies.
Going in-depth about the regulations from banks and governments, Snowden also exposed the necessity for exchanges to defend their users’ privacy. He fears that if one of the exchanges gave up information, soon all of them would follow.
“If you actually go into the terms of big exchanges like Coinbase, they only want to cover themselves. They expose you, they close your account and keep your funds,” Snowden said.
He also disliked the development of financial cryptocurrency services, claiming that many of them are starting to look too much like banks.
“Something unforgivable is that you guys keep developing services trying to be banks, and the world doesn’t need more banks,” he said.
Leave No Trace
Snowden also talked about the Shadow Brokers, a group of hackers that auctioned NSA information in exchange for bitcoin in 2016.
He noted that the hacking case was the starting point of a governmental war on cryptocurrencies. In short, he said, regulation doesn’t work unless it becomes overly intrusive.
“If tracking bitcoin was possible then the NSA would have caught them,” he said. He said Satoshi Nakamoto was in the same position: he could navigate the system and leave no trace.
“If you know how the system works, you can still have privacy,” he said.