Conversation

Jun 5, 2020

SCOOP: Based on public records, it appears that Coinbase is in the process of selling blockchain analysis services to the IRS and DEA - a year after acquiring Neutrino led by former leaders of an Italian spyware vendor Hacking Team. theblockcrypto.com/post/67551/coi

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Larry Cermak

@lawmaster

Jun 5, 2020

I don't exactly understand why this would be worth it for Coinbase since they are already making tens of millions a year just from the trading fees. There is a clear conflict of interest since Coinbase has access to all the customers' KYC documents unlike someone like Chainalysis

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Larry Cermak

@lawmaster

Jun 5, 2020

It is surprising they are going after the government's money for investigations rather than after exchange compliance. This could mean they are doing it for law enforcement relationships. But I'm not sure it will be worth it given that customers won't be happy about that.

SBF

@SBF_FTX

Replying to

@lawmaster

That’s my guess here— A) They think it will help their relationship with the government B) they think potential IPO investors will like it C) their retail base is less likely to find out and care about this than other exchanges’ highly crypto-informed, privacy-focused ones

8:32 PM · Jun 5, 2020Twitter for iPhone

Replying to

and

Yea, I thought about the IPO connection as well. I think it's exactly what you say. Mainly to have a good relationship with the US government and they are counting on the fact that the retail customers will not care. But it's terrible PR regardless