Coinbase
In what seems like an attempt to show community compliance, Brian Armstrong, the CEO of the leading US-based veteran exchange Coinbase, said that the company would part with former members of the Hacking Team. But is there more to that story?
In an official blog post dated February 19th, Coinbase announced the acquisition of the blockchain intelligence platform Neutrino.
Per the release, the move was geared at preventing theft of funds, investigating ransomware attacks, and identifying bad actors in general. The post also revealed that Neutrino’s technology is “the best Coinbase has come across in this space”, and that it will help ensure compliance with local regulations and existing legal frameworks.
It wasn’t long after that, however, when things went south: The cryptocurrency community immediately rang the alarm regarding some of Neutrino’s staff members. The blockchain intelligence platform’s CEO, Giancarlo Russo, previously served as the Chief Operating Officer at the Hacking Team – an Italian-based venue with questionable, to say the least, reputation. Other members of Neutrino were also part of the organization.
In a report from 2013, The Verge revealed that the Hacking Team has been selling commercial hacking software to the police. The venue’s spyware supposedly enabled its clients to engage in numerous surveillance activities.
Commenting on the matter was the Director of Institutional Sales at Coinbase, Christine Sandler. As Cryptopotato reported, Sandler revealed that the exchange was well aware of Neutrino staff members’ previous occupation. She also said that client data of Coinbase’s users was sold by third-party providers, hence adding more fuel to the fire.
Sandler justified Coinbase’s acquisition with Neutrino’s proprietary technology that they “could leverage to keep the data safe and protect our clients.”
The cryptocurrency community, however, wasn’t going to have it.
That’s how the trending hashtag #DeleteCoinbase started gaining massive momentum on social media. The movement encouraged cryptocurrency users to delete their Coinbase accounts after the acquisition effectively.
Here’s where Brian Armstrong, Coinbase’s CEO stepped in with an official post he wrote on the matter.
Titled “Living up to our values and the Neutrino acquisition,” Armstrong admitted that they “had a gap” in their diligence process and failed to properly evaluate “everything from the perspective” of their mission and values.
As a result, the exchange, alongside Neutrino, decided to part with the platform’s members who previously worked at Hacking Team, saying that they will “transition out of Coinbase.” The motives: their prior work apparently conflicts the exchange’s mission.
And while Armstrong’s attempt to rectify the situation, providing what seems much like an apology to the cryptocurrency community does look like a step in the right direction, it seems to raise more questions than it answers.
For once, there is an apparent lack of information regarding the exact members who will be transitioned out of Coinbase. No names have been provided whatsoever.
Besides, there’s also a desperate need for more details on the matter of Coinbase selling their own user’s data through third-parties.
The good thing of all this is that the situation revealed that the cryptocurrency community is capable of quickly organizing itself against ambiguity and lack of transparency – something that cryptocurrencies are geared to shake off in the first place.
Final words: Coinbase indeed listened to the community voice. This should serve as a wake-up call for many crypto projects, especially particular ICOs, that favor their founders and team on behalf of the community, who raised money for their project.
