Coinbase Exec Defends Neutrino Acquisition, Says User Data is More Secure Now
Coinbase’s director of institutional sales, Christine Sandler, has defended the cryptocurrency exchange’s recent acquisition of blockchain intelligence firm, Neutrino. In an interview with Cheddar last Friday, March 1st, Sandler said that previous client data providers had been selling Coinbase user data to outside parties.
On February 19th, Coinbase announced its acquisition of Neutrino. The company said Neutrino would continue to operate as a standalone company in its London offices, but it would employ the firm’s anti-money laundering (AML) and knowing your customer (KYC) technology, which Sandler described as “industry-leading and best in class”. According to their website, Neutrino “develops solutions for monitoring, analyzing and tracking cryptocurrency flows across multiple blockchains, providing actionable insight on the whole cryptocurrency ecosystem… using proprietary technology.”
The acquisition quickly invited controversy when details of Neutrino’s co-founders previous involvement with Italian commercial software firm, Hacking Team, became known. According to a report by Vice’s Motherboard, the Hacking Team has sold surveillance software to governments and law enforcement agencies across the world, including authoritarian regimes.
When asked about the uproar caused by these controversial connections, which even led to the hashtag #DeleteCoinbase, Sandler defended and explained Coinbase’s acquisition, explaining that customer data is now safer than ever:
“We are aware of the backgrounds of some of the folks that were involved in Neutrino and we are looking into that. […] It was important for us to migrate away from our current providers. They were actually selling client data to outside sources and it was compelling for us to get control over that, and have proprietary technology that we could leverage to keep the data safe and protect our clients.”
Later in the interview, Sandler spoke about Coinbase Pro’s recent decision to list Ripple’s XRP, which the United States Securities and Exchange Commission (SEC) has yet to classify as a security or not. However, Sandler noted that Coinbase would be prepared for a decision in either direction, since its June 2018 acquisition of broker-dealer Keystone would allow them to list securities.