'Apple and Google Are Systemic Risks To Crypto,'

‘Apple and Google Are Systemic Risks To Crypto,’ – Ex-Coinbase CTO

Updated: 22 May 2023

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Former Coinbase CTO, Balaji Srinivasan, has expressed concerns about the potential risks posed by major tech companies to the cryptocurrency industry. He specifically highlighted Apple and Google as systemic risks, suggesting that the Federal government could exploit their devices to gain access to private keys.

Srinivasan’s remarks, made via Twitter on May 19, raise important questions about the intersection of technology, politics, and the future of cryptocurrencies.

Srinivasan emphasized the increasing importance of cryptocurrencies in global politics, drawing parallels to the role that social media platforms like Twitter and Facebook played in catalyzing the Arab Spring in 2010. He argued that in the coming years, the possession of sufficient Bitcoin by financially struggling governments could become a crucial political issue.

He stated:

“By the end of this decade, the most important political issue in the world may be whether bankrupt governments have sufficient Bitcoin to fund their operations.”

Potential Threats Of Government Coercion

Under such circumstances, Srinivasan speculated on the actions desperate governments might take to acquire Bitcoin. Instead of relying on a traditional 51% attack through mining, he suggested that the Federal government could coerce tech giants like Apple, Google, and other companies into searching for private keys on their servers, devices, and browsers.

This strategy would enable the government to appropriate funds acquired, serving as a financial lifeline for cash-strapped administrations. Srinivasan stressed that this scenario should be viewed as cyberwar rather than cyberterrorism, as it involves CEOs of companies giving lawful orders to hack their own customers.

Srinivasan highlighted the immense scale of such an attack, involving billions of iPhones, Android phones, Mac laptops, Chrome browsers, Google Docs, and Gmail accounts.

He also raised the possibility that China could employ a similar strategy using its own smartphone manufacturers. The potential target of such an attack is vast, encompassing numerous devices and platforms that individuals use daily.

The tech guru acknowledged the complexity of defending against such attacks. While he commended Apple CEO Tim Cook for his resistance to government pressure on encryption and initiatives like child sexual abuse material (CSAM) scanning, he noted that trusting the operating system itself becomes problematic in this context.

Linux was suggested as a potential alternative, but its widespread adoption may not be feasible within the necessary timeframe. Srinivasan mentioned:

“Exchanges built on Linux are another possible answer, but those are of course custodial and possibly also vulnerable to similar attacks.”

Source: CSO online

Bullish Outlook on the Crypto Industry

Despite the potential risks outlined, Srinivasan remains bullish on the cryptocurrency industry. In a previous projection, he suggested that Bitcoin could reach $1 million triggered by the U.S. economy experiencing hyperinflation.

In a blog post, he issued a warning, expressing that the world is currently confronting not only a financial crisis but also a crisis related to traditional fiat currencies, with the potential for a meltdown that could surpass previous occurrences.

I just burned a million to tell you they're printing trillions. pic.twitter.com/pX5622rjUO

— Balaji (@balajis) May 2, 2023

While the industry faces challenges and threats, Srinivasan’s warning serves as a call to action to consider not only technological solutions but also social and political measures.

The Governments-Tech Companies Nexus

Srinivasan’s concerns shed light on the evolving relationship between governments and tech companies. The prospect of governments utilizing tech giants to access private keys raises important ethical and legal questions. Balancing security concerns and individual privacy rights is a delicate task, requiring a comprehensive understanding of the potential consequences.

As the world becomes increasingly digitized, the need for robust safeguards to protect digital assets and individual liberties grows. Srinivasan’s warning serves as a reminder that technological advancements should go hand in hand with careful consideration of their broader implications, particularly in the realm of finance and politics.