An Ethereum Foundation (EF) researcher revealed that the IP addresses of Ether (ETH) participants are monitored as part of a larger set of metadata, prompting the cryptocurrency community to flag Ethereum for privacy concerns.
On a April 12 interview On the Bankless crypto podcast, EF researcher Justin Drake revealed that he learned this information “internally”, presumably at EF.
The metadata Drake referred to is used to track a wide range of things, he explained:
“There’s a lot of metadata, you can see deposit addresses, you can see withdrawal addresses, you can see fee recipients, you can see IP addresses.”
Drake’s comments seemed to have taken Bankless host Ryan Sean Adams by surprise.
Ethereum = 1984 chain
Justin Drake, who works as a “Researcher” at the Ethereum Foundation, said today that when you stake your ETH, it can be tracked via IP address.
He says that he knows information “inside” that such databases exist. pic.twitter.com/2V6DvTobL3
— Debtor (@debtor) April 13, 2023
“So it’s a pretty Sybil-resistant dataset of its most involved Ethereum citizens?” Adams asked.
“Exactly,” Drake replied.
The conversation started when Drake predicted that “special airdrops” might be available to solo entrants, but not industry heavyweights:
“So you can identify, okay, we know who Kraken is, we know who Coinbase is, and we just can’t give them an airdrop if the purpose of the airdrop is to airdrop it to specific people running solo validators.”
The conversation caused a stir on Crypto Twitter.
Related: Cryptocurrency privacy is in greater danger than ever: here’s why
A Twitter user referred to Ether as the “real surveillance coin”, while other mocked Drake by sarcastically repeating it: “We can stop censorship by censoring those we don’t like.”
Other he described the situation as “central government done perfectly”.
To resolve privacy concerns, one Twitter user suggested Ethereum users take on-chain privacy responsibilities by installing a Linux operating system, using a virtual private network (VPN), and storing crypto assets on a hardware wallet like Ledger:
DeFi Security Settings:
– linux system
-VPN 24/7
– Ledger (hardware wallet)Protect yourself from data mining and scams
I’m missing something? https://t.co/X2YrGwpbdx
— DeFi Crypto Vaults (@DefiVaults) April 13, 2023
It’s also not the first privacy-related statement to have caused a stir in the crypto community.
ConsenSys, the team behind the Ethereum Metamask wallet, began collecting IP addresses in November. The policy change was made to ensure the company could comply with Know Your Customer (KYC) and Anti-Money Laundering (AML) where necessary.
Cointelegraph reached out to Drake and the Ethereum Foundation for comment but did not immediately receive a response.
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