According to media reports, Coinbase is selling comprehensive surveillance software to the United States Immigration and Customs Enforcement, ICE. This stems from an internal contract document that had to be released after a Freedom of Information Act request. It can be viewed on the NGO Tech Inquiry platform. Particularly explosive: The deal with ICE also includes the sale of GPS data. From a purely legal point of view, the authorities could apparently do with him what they wanted.
The monitoring software is called Coinbase Tracer. Coinbase markets them for use in criminal investigations and enforcement. Tracer allows businesses and government agencies to “investigate illegal activities, including money laundering and terrorist financing” and “connect cryptographic addresses to real-world entities.” According to the document, Coinbase sold a license to ICE for $1.36 million in August 2021. It also includes the highly controversial department of Homeland Security.
Authorities can use Coinbase Tracer to monitor dozens of cryptocurrencies, including Bitcon, Ethereum, and Tether. Get more detailed information about transfers and better analyze money flows, for example, the use of mixers. These are often used for money laundering.
The contract also includes “historical geolocation data”. What exactly this data consists of or where it comes from is not explained in the contract. Also concerning is that, according to a published email, ICE did not have to agree to an end-user license agreement. This often limits what a client can do with the software.
Coinbase responded yesterday to the accusations via Twitter. They “don’t sell any user data,” she says. Coinbase Tracker was created to “support compliance” and “assist in the investigation of financial crimes such as money laundering and terrorist financing.”
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