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Popular cybersecurity company Surfshark recently analyzed the 15 most popular crypto apps to find out how much data each collects. They found that nine of these use collected data to track their users. But it’s not just how much data is collected, but how it’s managed, Lead Researcher Agneska Sablovskaja told Cryptonews. She added that the company was particularly surprised by Binance and Binance.US.
Here’s what the experts found.
Data Privacy is Key in Crypto
Per Surfshark’s Sablovskaja, “data privacy stands as a cornerstone of trust, particularly in the realm of cryptocurrency. Our study reveals the data collection practices of leading crypto applications, aiming to foster vigilance and informed usage among individuals navigating these sensitive digital territories.”
The company selected 15 apps, with the most downloads in 2023 in Western countries, from the AppMagic platform.
The team collected data from each app’s Apple App Store page on November 7, 2023. Each page provides a list of 32 unique data points grouped into 12 categories. They initially published the report on November 14.
However, talking with Cryptonews, the team re-checked the data this week, confirming that “all analyzed apps collect the same amount and types of data.”
Also, all analyzed crypto apps are still in the top 15 in Western countries.
The article notes a couple of differences that do exist below.
The Most>
Among the 15 popular crypto apps, Robinhood “stands out as the most>Crypto.com. It collects 20 data points.
Coinbase follows with 18 data points.
Source: Surfshark
That said, some apps are more privacy-oriented, Surfshark found. Bybit and Binance gather four data points each.
Meanwhile, Trust collects only one out of the 32.
Furthermore, 10 of the 15 analyzed apps collect data linked to users’ identities. Kraken, the report highlighted, collects 11 unique data points. Ten are linked to the user, including financial information, photos or videos, and product interaction data.
However, the main issue, argues the cybersecurity company, goes beyond the volume of data collected – it’s how that data is managed.
Previously eight – but with Robinhood, it’s now nine – of these top apps use collected data to track users. This can be done by sharing user data with third-party advertisers or data brokers.
Binance.US is at the top of the list here. In November, it used almost two-thirds of collected user data for tracking purposes. In comparison, Binance used only one data point to track its users.
Binance Was a Surprising Case
Speaking of Binance, Surfshark highlighted Binance.US as an interesting case. Sablovskaja told Cryptonews that “Binance brought some surprising findings.”
In November, the US-focused application was collecting four times more data than its global sister app Binance.
Binance.US collects 17 data points, compared to just four collected by Binance. And this is despite the fact that Binance.US has fewer features than the global version.
Binance.US also leads in data tracking among the 15 apps — it uses almost two-thirds of the data it collects for tracking purposes. This means that it’s likely shared with third-party advertisers or data brokers, the Lead Researcher said.
Per the report,
“Binance seems to be more anonymous as it does not collect any contact information, whereas Binance.US collects it all — name, email address, phone number, and physical address.”
But this is where the final difference since November appears, showcasing the changes in the ecosystem.
In November, the global Binance app was still available in the US App Store. But at the rechecking time, the team couldn’t find the page. “At the moment, it seems like this page does not exist anymore,” Surfshark said.
According to AppMagic data, in December, the global Binance app was not on the list of most downloaded apps in the US, even though in November, it ranked 5th, the company told Cryptonews.
Notably, Binance Holdings, its US affiliates, and founder Changpeng ‘CZ’ Zhao have been in scolding hot regulatory waters in a number of countries for months.
Specifically in the US, the Securities and Exchange Commission (SEC) charged all three earlier this year for multiple offenses, including “blatant disregard of the federal securities laws.”
The world’s largest crypto exchange and its founder were accused of “engaging in multiple unregistered offers and sales of crypto asset securities and other investment schemes.”
Then, in late November, Binance and CZ pleaded guilty to violating US anti-money laundering laws in a $4.3 billion settlement with the US Justice Department, Treasury, and Commodity Futures Trading Commission (CFTC).
Meanwhile, the SEC has continued investigating Binance.US and CZ.
Some Data Collection Is Necessary, But…
Sablovskaja told Cryptonews that data collection might be necessary for the proper functioning of the app or compliance with local laws.
“However, users should keep an eye out for apps that collect much more data than alternative apps, especially if this data is linked to the user and used for tracking purposes.”
She continued. Even if these apps have legitimate justifications for data collection and tracking, Robinhood’s 2021 data breach and the US IRS’s request to Kraken to disclose user data show that there’s no guarantee that the data shared with crypto apps will remain out of reach to third – and sometimes malicious – parties.
Notably, some apps are committed to upholding maximum user privacy, Sablovskaja opined. She highlighted Trust, saying that it collects just one data point (diagnostics) and does not use this data to track its users.
Meanwhile, the best way for users to protect themselves and their privacy is by educating themselves on the data collection practices of the apps they use, the expert stated.
“It’s safe to assume that most people who use crypto are privacy-conscious. It’s important to extend this privacy-conscious mindset to crypto apps as well,” Sablovskaja concluded.
