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US CLOUD Act passes, privacy concerns rise in cryptocurrency circles

US President Donald Trump has officially signed the CLOUD (Clarifying Lawful Overseas Use of Data) Act into law, prompting fears of increased surveillance from cryptocurrency pundits.

Shortly after whistleblower Edward Snowden revealed the extent of the US National Security Agency (NSA)’s Bitcoin monitoring operations and offered his own thoughts on the pseudonymity offered by cryptocurrencies, President Donald Trump has now officially signed the CLOUD (Clarifying Lawful Overseas Use of Data) Act into law.

The CLOUD Act – a controversial addition to the United States’ $1.3 trillion USD spending bill – is designed to accommodate foreign governments with access to US-based companies when querying data gathered from their own citizens.

Notably, the bill offers the US government with greater access to the private data of citizens for the purposes of law enforcement.

The bill – which passed 256-167 in the House of Representatives, and 65-23 in the Senate – has been bitterly opposed by several privacy advocates. In an official statement, the Electronic Frontier Foundation (EFF) derided the bill as a “final, tacked-on piece of legislation” that will “erode privacy protections around the globe.”

Interestingly, many homegrown technology giants have supported the adoption of the bill – with  Apple, Facebook, Google, Microsoft, and Oath providing a joint letter advocating for the quick adoption of legislation.

In a joint statement, the firms elaborated that “Our companies have long advocated for international agreements and global solutions to protect our customers and Internet users around the world. We have always stressed that dialogue and legislation – not litigation – is the best approach. If enacted, the CLOUD Act would be notable progress to protect consumers’ rights and would reduce conflicts of law.”

The move has been met with derision in cryptocurrency circles, with several prominent figures urging users and enthusiasts to pivot to privacy focussed coins as a means to escape surveillance.

The adoption of the CLOUD Act hinges closely on a contentious issue within cryptocurrency circles. While the benefits of distributed ledger technology offer a transparent and publically accessible means of transaction for peer-to-peer traders around the world, the question of the privacy behind personal data is yet to be resolved.

In a recent statement, Snowden himself quipped that Bitcoin’s “the long-lasting flaw is its public ledger” – elaborating that “you cannot have a lifelong history of everyone’s purchases available to everyone and have that work out well at scale”.

Snowden’s comments come in the wake of revelations that have depicted the NSA’s extensive Bitcoin monitoring operations. New reports have revealed that the NSA has not only proceeded to track transactions on the Bitcoin network, but has further analyzed global internet traffic and collected user passwords and device identifiers to undermine the pseudonymity of users leveraging Bitcoin to transact.

Other international authorities, such as the International Monetary Fund head Christine Lagarde, have called for the development of blockchain technology to undermine the pseudonymity – or in some cases, anonymity – of participants.

It remains to be seen if legislation such as the CLOUD Act – or the pervasive operations of entities such as the NSA – might offer a wider adoption of privacy-focussed coins.

Posted: Mar 26, 2018 Author: Bryan Smith Categories: Popular Tags: Tags: