vpn

Ethereum researcher says staking reveals IP address, sparking privacy concerns

A researcher at the Ethereum Foundation says he had “internally” discovered that staking Ether reveals a user’s IP address information.

A researcher at the Ethereum Foundation has revealed that the IP addresses of Ether (ETH) stakers are monitored as part of a broader set of metadata, causing the cryptocurrency community to flag Ethereum for privacy concerns.

In an April 12 interview on the crypto podcast Bankless, EF researcher Justin Drake revealed that he learned this information “internally” — presumably, at the foundation.

The metadata Drake referred to is used to track a wide range of things, he explained:

“There’s a lot of metadata, you can look at deposit addresses, you can look at withdrawal addresses, you can look at fee recipients, you can look at IP addresses.”

Drake’s comments appeared to have taken Bankless host Ryan Sean Adams by surprise.

“So it’s a fairly Sybil resistant dataset of your most involved Ethereum citizens?” Adams asked.

“Exactly,” Drake responded.

The conversation was initiated when Drake predicted that “special airdrops” may become available for solo stakers — but not the industry heavyweights:

“Then you can identify, okay, we know who Kraken is, we know who Coinbase is, and we can just not give them an airdrop if the purpose of the airdrop is to airdrop to specific individuals that are running solo validators.”

The conversation caused a stir on Crypto Twitter.

Related: Crypto privacy is in greater jeopardy than ever before — here’s why

One Twitter user referred to Ether as the “real surveillance coin,” while another mocked Drake by sarcastically rehashing him: “We can stop censorship by censoring those we don’t like.”

Another described the situation as “central governance to a T.”

To resolve the privacy concerns, one Twitter user suggested that Ethereum users take on-chain privacy responsibilities into their own hands by installing a Linux operating system, using a Virtual Private Network (VPN) and storing crypto assets on a hardware wallet such as Ledger:

It isn’t the first privacy-related statement to have caused a stir in the crypto community either.

ConsenSys, the team behind Ethereum wallet MetaMask, began collecting IP addresses in November. The policy amendment was made to ensure that the firm could comply with Know Your Customer (KYC) and Anti-Money Laundering (AML) policies where necessary.

Cointelegraph contacted Drake and the Ethereum Foundation for comment but did not receive an immediate response.

Magazine: ‘Account abstraction’ supercharges Ethereum wallets: Dummies guide

Ethereum researcher says staking reveals IP address sparking privacy concerns

A researcher at the Ethereum Foundation said he had “internally” discovered that staking Ether reveals a user’s IP address information.

A researcher at the Ethereum Foundation (EF) revealed that the IP addresses of Ether (ETH) stakers are monitored as part of a broader set of metadata, causing the cryptocurrency community to flag Ethereum for privacy concerns.

In an April 12 interview on the crypto podcast Bankless, 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 look at deposit addresses, you can look at withdrawal addresses, you can look at fee recipients, you can look at IP addresses.”

Drake’s comments appeared to have taken Bankless host Ryan Sean Adams by surprise.

“So it’s a fairly Sybil resistant dataset of your most involved Ethereum citizens?” Adams asked.

“Exactly,” Drake responded.

The conversation was initiated when Drake predicted that “special airdrops” may become available for solo stakers — but not the industry heavyweights:

“Then you can identify, okay, we know who Kraken is, we know who Coinbase is, and we can just not give them an airdrop if the purpose of the airdrop is to airdrop to specific individuals that are running solo validators.”

The conversation caused a stir on Crypto Twitter.

Related: Crypto privacy is in greater jeopardy than ever before — here’s why

One Twitter user referred to Ether as the “real surveillance coin,” while another mocked Drake by sarcastically rehashing him: “We can stop censorship by censoring those we don’t like.”

Another described the situation as “central governance to a T.”

To resolve the privacy concerns, one Twitter user suggested Ethereum users take on-chain privacy responsibilities into their own hands by installing a Linux operating system, using a Virtual Private Network (VPN) and storing cryptoassets on a hardware wallet such as Ledger:

It isn’t the first privacy-related statement to have caused a stir in the crypto community either.

ConsenSys, the team behind Ethereum wallet Metamask began collecting IP addresses in November. The policy amendment was made to ensure that the firm could comply with Know Your Customer (KYC) and Anti-Money Laundering (AML) where necessary.

Cointelegraph contacted Drake and the Ethereum Foundation for comment but did not receive an immediate response.

Magazine: ‘Account abstraction’ supercharges Ethereum wallets: Dummies guide

Jane Street, Tower Research and Radix are Binance’s ‘VIP’ clients in CFTC suit: Report

The firms were cited anonymously in the CFTC’s complaint describing Binance’s alleged facilitation of U.S. clients.

Trading firms Jane Street Group, Tower Research Capital and Radix Trading have been reportedly identified as Binance’s three “VIP” clients that were anonymously cited in the recent lawsuit filed against Binance by the United States commodities regulator.

According to an April 5 Bloomberg report citing “people familiar with the matter,” Radix Trading is “Trading Firm A” as described in the Commodities Futures Trading Commission’s (CFTC) suit, while Jane Street was “Trading Firm B” and Tower Research was “Trading Firm C.”

The firms on the CFTC’s list were examples of U.S. clients allegedly able to access Binance.

The Wall Street Journal (WSJ) first reported on March 28 that Radix Trading was “Trading Firm A.”

Radix co-founder Benjamin Blander told the WSJ in a March 30 report that he believed the firm acted legally even when trading with Binance’s offshore entity.

The claimed “VIP” treatment from Binance included lower transaction fees and faster trading services, the CFTC said in the filing. The firms provided Binance with liquidity on the exchange, and Binance gained the corresponding trading fee revenues.

It was part of a strategy that “actively facilitated violations of U.S. law” by helping U.S. trading firms evade Know Your Customer compliance standards, among other things, the CFTC alleged.

Binance allegedly enabled Radix to sidestep compliance controls by providing them information on accessing Binance.com through a virtual private network to obscure its IP address.

Related: Dubai regulator demands Binance provide info on ownership, governance: Report

The CFTC claimed the trading violations to have come about as Binance prioritized “commercial success over compliance with U.S. law.”

However, Binance CEO Changpeng “CZ” Zhao vehemently denied the claims of compliance and market manipulation violations in a follow-up post on March 28.

Magazine: US enforcement agencies are turning up the heat on crypto-related crime

SBF lawyers to pay for technical expert to aid judge on bail terms

The judge overseeing Sam Bankman-Fried’s fraud case wants some help navigating the world of encrypted messaging, privacy apps, and virtual private networks.

Attorneys working on behalf of former FTX CEO Sam Bankman-Fried have agreed to pay for a security expert to assist the federal judge overseeing his fraud case in navigating modern encryption technology to aid in possibly modifying Bankman-Fried’s bail terms.

Bankman-Fried lawyers Christian Everdell and Mark Cohen sent a letter to Judge Lewis Kaplan on Feb. 21 agreeing with his proposal for a technical professional to aid him.

According to the letter, “the defense has already begun researching and contacting possible experts and anticipates being able to propose one or more potential candidates to the court by the end of the week.”

Judge Kaplan suggested at a bail hearing last week following a tightening of bail terms when it was discovered that Bankman-Fried had been accessing the internet using a VPN (virtual private network).

A VPN obscures and encrypts a user’s internet traffic and is often used to change internet (IP) addresses, to add a layer of security to communications or to access censored content in autocratic regimes.

The judge has been trying to achieve a balance between letting Bankman-Fried access communication channels to prepare his defense and the potential misuse of messaging apps and privacy software.

Judge Kaplan temporarily banned Bankman-Fried from using a VPN or any encrypted messaging apps until his bail terms are settled.

Related: Sam Bankman-Fried may no longer be allowed to play League of Legends

The technical expert will help the judge navigate issues regarding encrypted messages, privacy-focused messaging apps and VPNs.

Bankman-Fried and his attorneys claim he used the VPN on two occasions, to watch the NFL playoffs on Jan. 29 and to watch the Super Bowl on Feb. 12.

Prosecutors have asked for strict bail terms limiting Bankman-Fried’s access to the internet and messaging platforms. They also alleged that VPN use “raised several potential concerns” regarding thepotential access of crypto platforms that have blocked United States users.

Sam Bankman-Fried’s use of a VPN on Super Bowl Sunday ‘raised concerns’, say prosecutors

Lawyers representing the former FTX CEO and U.S. prosecutors requested until Feb. 17 to discuss the impact using a VPN could have on Bankman-Fried’s bail conditions.

Prosecutors behind the criminal case against former FTX chief executive officer Sam Bankman-Fried have requested additional time to consider the legal implications of him using a virtual private network, or VPN.

In a Feb. 13 filing with the United States District Court for the Southern District of New York, U.S. Attorney Damian Williams said the Justice Department had uncovered that Bankman-Fried accessed the internet on Jan. 29 and Feb. 12 — the second date being Super Bowl LVII. According to Williams, the government’s view was that using a VPN “raises several potential concerns”, citing examples of U.S.-based users accessing certain international crypto exchanges, and obscuring data from websites Bankman-Fried may be visiting.

“A VPN allows data transfers without detection through a secure, encrypted connection [and] is a more secure and covert method of accessing the dark web,” said the filing. “The defense maintains that the defendant was not using a VPN for any improper purpose and has indicated that it would like the opportunity to engage in discussions with the Government about the issue.”

According to Mark Cohen of the law firm Cohen & Gresser — representing SBF in the criminal case — the former FTX CEO used the VPN to watch sports coverage including the Super Bowl. He added that until the issue was resolved among lawyers, Bankman-Fried would not use a VPN.

“On January 29, 2023, he watched the AFC and NFC Championship games and on February 12, he watched the Super Bowl. This use of a VPN does not implicate any of the concerns raised by the Government in its letter.”

The court document suggested that Bankman-Fried’s legal team was discussing whether the former FTX CEO’s use of a VPN could be included as a condition of his bail. Since SBF’s arrest, prosecutors have already asked the court to restrict Bankman-Fried’s use of certain messaging apps and refrain from contacting current or former FTX and Alameda Research employees. Both Bankman-Fried’s lawyers and U.S. prosecutors requested until Feb. 17 to discuss the impact SBF using a VPN could have on his bail conditions.

Related: Sam Bankman-Fried seeks to access FTX funds

Bankman-Fried’s criminal trial is scheduled to begin in October, when he will face eight counts related to wire fraud and violations of campaign finance laws. A judge ruled on Feb. 13 that civil cases SBF faces from the U.S. Securities and Exchange Commission and Commodity Futures Trading Commission will wait until the conclusion of the criminal case.

Sam Bankman-Fried’s use of a VPN on Super Bowl Sunday ‘raised concerns,’ say prosecutors

Lawyers representing the former FTX CEO and U.S. prosecutors requested until Feb. 17 to discuss the impact using a VPN could have on Bankman-Fried’s bail conditions.

Prosecutors behind the criminal case against former FTX CEO Sam Bankman-Fried have requested additional time to consider the legal implications of him using a virtual private network, or VPN.

In a Feb. 13 filing with the United States District Court for the Southern District of New York, U.S. Attorney Damian Williams said the Justice Department had uncovered that Bankman-Fried accessed the internet on Jan. 29 and Feb. 12 — the second date being Super Bowl LVII. According to Williams, the government’s view was that using a VPN “raises several potential concerns,” citing examples of U.S.-based users accessing certain international crypto exchanges and obscuring data from websites Bankman-Fried may be visiting.

“A VPN allows data transfers without detection through a secure, encrypted connection [and] is a more secure and covert method of accessing the dark web,” said the filing. “The defense maintains that the defendant was not using a VPN for any improper purpose and has indicated that it would like the opportunity to engage in discussions with the Government about the issue.”

According to Mark Cohen of the law firm Cohen & Gresser — representing SBF in the criminal case — the former FTX CEO used the VPN to watch sports coverage, including the Super Bowl. He added that until the issue was resolved among lawyers, Bankman-Fried would not use a VPN.

“On January 29, 2023, he watched the AFC and NFC Championship games and on February 12, he watched the Super Bowl. This use of a VPN does not implicate any of the concerns raised by the Government in its letter.”

The court document suggested that Bankman-Fried’s legal team was discussing whether the former FTX CEO’s use of a VPN could be included as a condition of his bail. Since SBF’s arrest, prosecutors have already asked the court to restrict Bankman-Fried’s use of certain messaging apps and refrain from contacting current or former FTX and Alameda Research employees. Both Bankman-Fried’s lawyers and U.S. prosecutors requested until Feb. 17 to discuss the impact SBF using a VPN could have on his bail conditions.

Related: Sam Bankman-Fried seeks to access FTX funds

Bankman-Fried’s criminal trial is scheduled to begin in October when he will face eight counts related to wire fraud and violations of campaign finance laws. A judge ruled on Feb. 13 that civil cases SBF faces from the U.S. Securities and Exchange Commission and Commodity Futures Trading Commission will wait until the conclusion of the criminal case.

Update (Feb. 14 at 7:25 PM UTC): A judge ordered Sam Bankman-Fried not to use a VPN as a condition of his bail, with a hearing set for Feb. 16 to present arguments.