What Does Facebook’s Privacy Woes mean for Crypto?

What Does Facebook’s Privacy Woes mean for Crypto?

Abishek Dharshan
05/23/19 10:28 AM 2019-05-24 13:42:50
It’s almost like saying the sky is blue but we have another Facebook data leak in hand affecting millions of users. This time around, it involves the contact information of more than 49 million Instag

It’s almost like saying the sky is blue but we have another Facebook data leak in hand affecting millions of users. This time around, it involves the contact information of more than 49 million Instagram accounts from a public Amazon Web Services (AWS) database, TechCrunch reports. Anurag Sen, a security researcher found the leak. In case you are wondering what this has to do with Facebook, Facebook owns Instagram. In April 2012, Facebook acquired the service for approximately US$1 billion in cash and stock.

More about the Leak

The exposed database is said to have public information from Instagram accounts, including the number of followers, likes, and shares of a particular user. What is mindboggling is the fact that email addresses and phone numbers of numerous account owners are also exposed even though Instagram claims to keep these private and encrypted.

Furthermore, Chtrbox, a social media marketing firm, owns the database and uses it to calculate the net worth for each account using this public information and presumably reached out with offers through the unethically obtained contact information.
A security firm UpGaurd had recently stated the existence of hundreds of millions of private Facebook user records on public third-party Amazon databases and the current leak only confirms these allegations.

Facebook as always has tried to dodge the allegation, telling TechCrunch:

“We’re looking into the issue to understand if the data described – including email and phone numbers – was from Instagram or from other sources.”

Not the First and Certainly Not the Last

This just adds to the current state of Facebook and their blatant disregard for user privacy regardless of their promises to improve. This is not the first time that Facebook has leaked the private information of its users.

Here is a list of Facebook and its privacy hassles in the past 3-4 years:

  • August 2017 – email addresses and phone numbers of around 6 million Instagram users.
  • In September 2018 – Facebook security vulnerabilities gave access to malicious parties to gather the personal information of almost 50 million users.
  • Cambridge Analytica.
  • Claims of Facebook storing passwords as plain text.

Keep in mind that these are just the ones that are known to the public.

Unsureity going forward

Facebook looks to turn things around by incorporating crypto and blockchain into its services. The social media company’s secretive cryptocurrency project, Project Libra has been in the works for more than a year. They got investments from giants like Visa and Mastercard for a potential payment system between Whatsapp users, and the product has now bloomed into a $1 billion conglomerate.

But ever since the Cambridge Analytica scandal, Facebook has taken a downward spiral. There is a steady decline in job acceptance rates and a decreasing user base. The Facebook Coin is expected to be useful for users in India that want to send and receive payments, but these scandals would further hurt their ability to roll out such products in different markets.

Rise and Fall of Facebook’s user base. | Source: Edison Research

Today, the World is more connected than it ever was, thereby making privacy a massive priority for users. Incidents like this, even after being under the fire multiple times, don’t put Facebook in a bright spot and is not helping the success rate of its potential cryptocurrency project. All we can say is Facebook’s involvement in cryptocurrency and blockchain can either make or break the company in the coming years.

Abishek Dharshan
Abhishek leads Community & Growth Product Management at Zerion - a DeFi Asset Management Company. Currently, he’s living in the hub of all great tech startups, San Francisco, with frequent trips to here and there around the world. Abhishek’s entrepreneurial drive and insatiable curiosity led him to scale and invest in companies and user-driven organizations at the bleeding edge of capital markets; web 3.0, and AI. His expertise on all things DeFi is aimed at pushing decentralization into the mainstream. His true power is his knowledge to help startups and companies to scale their operations for a DeFi future. You can connect with Abhishek on Linkedin.

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