Category Archives: Alberto Ornaghi

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Coinbase, Neutrino Part with Hacking Team Ex-Members

US-based cryptocurrency exchange Coinbase may have listened after all to the agitations of its user base regarding its acquisition of Neutrino. It is to discontinue the relationship with members of the Neutrino team who previously worked with the Hacking Team since their prior work conflicts with their current mission.

Yesterday, Coinbase CEO Brian Armstrong explained in a blog post that the decision was “living up to the exchange’s values”, after falling short of its due diligence. In what appears to be a veiled apology, he said:

“We had a gap in our diligence process. While we looked hard at the technology and security of the Neutrino product, we did not properly evaluate everything from the perspective of our mission and values as a crypto company.”

The exchange has reconsidered its decision and together with the Neutrino team have agreed that “those who worked with the Hacking Team will transition out of Coinbase, despite not having a current affiliation with the Hacking Team”. It is not currently known exactly how many members of the Hacking Team were working for the Neutrino project, however, the executives of the project, Marco Valleri and Alberto Ornaghi, stood out.

Like most cryptocurrency platforms out there, decentralizing the financial system and placing end users in control of financials is a top priority. “[Coinbase’s] mission as a company is to create an open financial system for the world,” says Armstrong and according to him, to do this required the empowerment of many people to acquire cryptocurrency.

The CEO further explained that the ambition of connecting to the traditional financial system – as a part of the company’s mission to an open financial system, required compliance with existing financial laws and regulations as regarding know your customer (KYC) and anti-money-laundering (AML) programs. And this he said, required blockchain analytics and that those of the Neutrino team were exceptional.

Earlier last week, the acquisition of Neutrino may have seemed to be an important milestone for the Coinbase team considering they were eventually going to need a blockchain analytics solution “in-house”.

However, their decision to have hurriedly acquired Neutrino analytics platform, while falling short of their due diligence in evaluating the past working experiences of the team members, soon turned ugly. Upon discovery of the historical background of the founders of Neutrino platform, Coinbase users protested against the acquisition in a #DeleteCoinbase hashtag movement that threatened to delete their accounts with the exchange.

 

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Coinbase Acquisition of Neutrino Said to Risk Hurting Users

Coinbase Acquisition of Neutrino Said to Risk Hurting Users

Coinbase’s controversial acquisition of analytics startup Neutrino has received lots of criticism, although one executive member explained the move as provident in light of the exposure of its former provider selling users data to third parties.

Last week, the largest cryptocurrency exchange in the US announced that it had acquired analytics platform Neutrino. The latter’s founding members were a part of the Hacking Team – a notorious tech firm accused of selling software to countries with poor human rights records. And while the news didn’t sit well with some of the exchange’s users, a protest was undertaken on Twitter with the ‘#DeleteCoinbase‘ hashtag supposedly meant to motivate users to withdraw all funds from the exchange and closing the accounts.

The fear is that those founding members of the Hacking Team, Marco Valleri and Alberto Ornaghi, now incorporated into Coinbase’s business exposes the userbase to unpredictable personal data harm. However, the head of institutional sales at Coinbase, Christine Sandler, had said that the move to acquire Neutrino was a necessary one, saying:

“It was important for Coinbase to bring this function in-house to fully control and protect our customers’ data and Neutrino’s technology was the best we encountered in the space to achieve this goal.”

She further defended the action stating that they were more interested in the technology than the talent, suggesting that Neutrino’s technology far outdid what was currently available in the industry.

The move may have been necessitated when the exchange discovered that the previous third-party provider was selling client data to outside sources. However, no previous announcement about this matter was made known to the public, which further questions the trust placed in Coinbase, as it supposedly withheld important information regarding its users’ data.

Ironically, the choice for Neutrino does raise an alarm seeing that the very reason they had fired the previous was what the currently acquired team members of Neutrino have been accused of doing. Reporters Without Borders have previously named the Hacking Team as one of the “Five Corporate Enemies of the Internet“.

One important question is whether the exchange will recover from this scandal, seeing how they may have lost trust from the cryptocurrency community with this singular move.

Coinbase frequented the news for the better part of 2018 and has so far in 2019 made a few headlines. It has been involved in many acquisition and developments that have made the platform outstand most cryptocurrency exchanges even with the bear market.

One of its recent development was the listing of Ripple’s XRP coin, which many may have been eagerly waiting for, considering that it is among the top three largest cryptocurrencies by market capitalization. The move has been questioned, seeing that the Securities and Exchange Commission is yet to provide a classification for XRP – whether or not it’s a security. However, the exchange seems to think it has a way of insulating itself should any consequence arise.

 

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