Arkham’s Controversial “Snitch-to-Earn” Platform and User Privacy Concerns
In Brief
Arkham’s new platform has been met with both criticism and praise, as it could potentially infringe on the privacy of crypto users while also providing a marketplace for users to earn rewards for collecting onchain data.
Arkham, a new entrant into the world of blockchain technology, has recently come under scrutiny from users and privacy experts alike. The company, positioning itself as a ‘blockchain intelligence company,’ unveiled its on-chain ‘Intel Exchange’ platform on July 10, amid a torrent of mixed reviews and growing privacy concerns.
The Birth of Arkham’s Intel Exchange
Arkham launched its proprietary digital coin, ARKM, on Binance’s Launchpad service, in conjunction with the announcement of the world’s first on-chain intelligence exchange. The novel platform, according to Arkham, allows users to anonymously post and accept bounties for information relating to blockchain transactions. The entity issuing the bounty will receive exclusive access to the acquired data for 90 days. After this period, Arkham plans to make the information public.
Announcing The World’s First On-Chain Intelligence Exchange
— Arkham (@ArkhamIntel) July 10, 2023
Buy and sell information on the owner of any blockchain wallet address—anonymously, via smart contract. pic.twitter.com/4xr7dLvOjp
This innovative yet controversial approach to information brokering has drawn both applause and criticism. On one hand, Arkham highlights the potential benefits of such a system, including enhancing blockchain transparency and facilitating the detection of illicit activities. However, critics counter this argument, suggesting that this “snitch-to-earn” model is ripe for misuse, thus escalating concerns about the privacy and security of blockchain users.
Growing Privacy Concerns
What has attracted the most criticism, however, is a privacy issue linked to Arkham’s referral system. Users who shared links to a waitlist for the Arkham service unknowingly exposed their email addresses on Twitter due to the simplicity of the encoded references. Arkham’s referral link embeds the user’s email in a simple BASE64 code, which can be easily reversed to reveal the original email. The simplicity of this encoding has led some to speculate that this exposure was not an oversight, but a deliberate act.
Arkham has confirmed that the encoding of emails serves as a feature, specifically designed to track user referrals and airdrop rewards. Despite this explanation, the privacy implications of such a practice have sparked an uproar within the crypto community.
Fuck this.
— Hudson Jameson (@hudsonjameson) July 10, 2023
It's not even the snitch-to-earn component that I'm entirely against (it is useful as a decentralized whistleblowing dapp for public good).
The submissions end up on Arkham + Arkham Fnd is the central arbiter.
Someone should fork the contracts and decentralize this. https://t.co/hnfehiukd9
Arkham CEO’s Remarks on Recent Privacy Oversight
In light of the recent controversy around Arkham’s referral links, CEO Miguel Morel has issued a statement to address the concerns raised by the crypto community.
Morel admitted the oversight in Arkham’s implementation of referral links, which originally contained a Base 64 encoded version of the referrer’s email for tracking purposes. He clarified that this feature was not designed for email collection but rather to validate the legitimacy of the invites, a practice common in many referral programs.
On Ref Links
— Miguel Morel | Arkham (@RealMiguelMorel) July 10, 2023
Because of our upcoming launch, we’ve had millions of people engage with our platform and hundreds of thousands sign up. Understandably, there’s been a lot of attention on our project, the majority of it positive, along with some legitimate criticisms of how we’ve… pic.twitter.com/0VZFchBg7h
However, he acknowledged the mistake in not adapting this feature when the user base surged. In response, Arkham has already updated its system to include an encrypted version of the referrer’s email in the links, which will prevent reverse-engineering.
Morel emphasized that Arkham always strives to prioritize its users and is continuously learning from its errors. With the goal of making the crypto space more transparent and equitable, he assured that Arkham would continue to work hard, adapt, and respond to users’ concerns.
The CEO further shared plans to publish an FAQ to tackle more questions about data privacy and protection. Despite the recent hiccup, he expressed gratitude for the continuous support Arkham has received from the community.
The statement underscores the company’s commitment to learning from its mistakes, improving its practices, and ensuring the security and privacy of its users. As Morel rightly highlighted, the aim is to bring the ‘bad actors’ in the crypto world into the light, and Arkham’s willingness to address and rectify its own shortcomings is a step towards that transparency.
ABSOLUTE LMAO. ALL #ARKHAM REFERRAL LINKS SHARED ON TWITTER IS DOXXING EVERYONE BECAUSE THE EMAIL IS IN THE REFERRAL URL. @inversebrahhttps://t.co/HM6veJOmNp -> bkatmis012@gmail.com https://t.co/1INvtXLEva pic.twitter.com/m38VnNMS8k
— m4gicpotato ⟁ (@m4gicpotato) July 10, 2023
The Implications of Arkham’s Approach
Arkham’s methodology, while innovative, presents serious implications for the future of blockchain and user privacy. The potential to “deanonymize” blockchain transactions, paired with a questionable approach to user data, could jeopardize the privacy and security of blockchain users.
Experts professional opinion lean toward advocating for caution. While Arkham’s initiative may have the potential to combat illicit activities within the blockchain space, the risks to user privacy seem disproportionate. There’s an immediate need to establish stringent regulations around the company’s practices, particularly regarding the encoding and use of users’ personal information.
Responses from the crypto community to Arkham have varied. Some view the company’s move as a groundbreaking stride towards enhanced transparency, while others condemn it as a “snitching-as-a-service” program. Regardless of the perspective, one thing is clear: Arkham’s debut has ignited a significant conversation about privacy, security, and the future of blockchain. As the debate continues, we must actively observe Arkham’s response to these concerns and whether it will revise its controversial practices in light of user feedback and emerging regulatory guidelines.
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About The Author
Nik is an accomplished analyst and writer at Metaverse Post, specializing in delivering cutting-edge insights into the fast-paced world of technology, with a particular emphasis on AI/ML, XR, VR, on-chain analytics, and blockchain development. His articles engage and inform a diverse audience, helping them stay ahead of the technological curve. Possessing a Master's degree in Economics and Management, Nik has a solid grasp of the nuances of the business world and its intersection with emergent technologies.
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Nik is an accomplished analyst and writer at Metaverse Post, specializing in delivering cutting-edge insights into the fast-paced world of technology, with a particular emphasis on AI/ML, XR, VR, on-chain analytics, and blockchain development. His articles engage and inform a diverse audience, helping them stay ahead of the technological curve. Possessing a Master's degree in Economics and Management, Nik has a solid grasp of the nuances of the business world and its intersection with emergent technologies.
