There was uproar in the cryptocurrency space yesterday when it was announced that the Bitcoin exchange ShapeShift is bringing in a new membership initiative, saying users are going to present a detailed personal data to have access to the exchange service.
In a Tweet by ShapeShift, it was maintained that the company now has a new membership terms and conditions.
📰🦊ShapeShift has big news for our users! We are now offering a new membership program, that will provide users with more benefits & a better user experience. Find out why we are making these changes from our CEO @ErikVoorhees: https://t.co/LnOoyLbIMU pic.twitter.com/PiTk26xVkA
— ShapeShift.io (@ShapeShift_io) September 4, 2018
“ShapeShift has big news for our users! We are now offering a new membership program, which will provide users with more benefits & better user experience.”
Meanwhile, the registration is still option, but in the nearest future, users have to fill in a comprehensive details about themselves.
According to the company, the new idea is a loyalty program that stands to permit users the advantage to have more benefits such as reduced exchange rates, rewards for FOX token transactions, among others.
In a message by ShapeShift’s CEO Erik Voorhees, it was admitted that the compulsory registration is a hard but important steps towards bringing sanity to the system in accordance to the regulatory procedures:
“Yes, that last detail sucks. We would prefer if the collection of personal information were not a mandatory element. We still firmly believe that individuals, regardless of their race, religion, or nationality, deserve the right to financial privacy, just as they deserve the right to privacy in their thoughts, in their relationships, and in their communications. Such privacy is a foundational element of civil and just society and should be defended by all good people. We remain committed to that cause, and it is best served if we are smart about our approach.”
A Washington D.C.-based lawyer Jake Chervinsky who responded to this initiative maintained that decision is birthed by regulators, pointing that ShapeShifts’s steps to seek more personal information about users is in response to pressures mounted by financial authorities, adding that, “in short, this is how regulators silently invade crypto.”
He said that because Voorhees is a true bitcoiner who passionately talk about financial privacy and separating money from state all constituted to Regulatory decision. He however pointed that enforcement agencies depend so much on financial surveillance, pointing that the idea of privacy cryptocurrency exchanges and transactions is a “nightmare for regulators & investigators.”
He said in his Tweet:
7/ Now, I'm *not* saying that I think ShapeShift qualifies as a money services business or that it's legally obligated to perform KYC.
But, I *am* guessing that FinCEN (or another agency) has threatened ShapeShift with an enforcement action if it doesn't start to comply.
— Jake Chervinsky (@jchervinsky) September 5, 2018
“Our financial system is expressly designed to give the government maximum insight into our financial behavior. To that end, most financial institutions have to perform customer due diligence and share information with regulators. We call this “know your customer” (KYC).”