Coinbase defended the licensing of its analysis software with the words: If people really wanted privacy, coins are meant for privacy.
Coinbase CEO Brian Armstrong used Twitter to talk about Coinbase Analytics and the company’s practice of licensing the platform and explain why cryptocurrency exchanges must have analytics software to comply with banking regulations.
“Exchanges that maintain connections to the existing financial system (i.e. the ability to connect your bank account, make transfers, etc. so that you can convert Fiat to cryptocurrency) must comply with AML laws, and this often includes the use of blockchain, Analysis software for transaction monitoring. “Armstrong tweeted: “There are many things that could be better than existing AML laws, and we haven’t created them, but these are the rules for legally operating a Fiat-to-Crypto exchange.”
The exchange was criticized on social media over the weekend after approving the use of its blockchain analysis software by the U.S. Secret Service and Department of Homeland Security, such as The Block originally reported it. Armstrong added that Building an analysis platform is expensive, so they wanted to amortize the costs through the sale. He said it was important to have analytics software, especially to encourage greater interaction between fiat money and cryptocurrencies.
In fact, U.S. intelligence has increased its control over cybercrime. The law enforcement agency recently launched the Cyber Fraud Task Force and focused on the role of cryptocurrencies in illegal online activity.
Coinbase’s CEO said transactions in a public blockchain are already traceable, even if the exchange has never sold its analytics platform to other parties.
“If people want real privacy, privacy coins are just the thing for them. I am a fan of privacy coins because I think everyone should have more financial privacy. It will be similar to how the Internet has changed from HTTP to HTTPS over time, ”he said.
Rumor has it that Coinbase is considering going public, but is still waiting for the green light from the Securities and Exchange Commission. The exchange also hired former Facebook deputy general counsel Paul Grewal and his legal team, possibly as he prepares for an IPO.