The recent hacks at ShapeShift, a kind of vending car for altcoins, has been 1 of the biggest stories inwards Bitcoin for the past times few weeks. Although the hacks were a serious striking to the exchange, CEO Erik Voorhees claims things could convey been much worse if the startup had decided to comply amongst BitLicense regulations inwards New York.
Traditional Regulations Won’t Work
Voorhees was lately on a panel related to disruptive Bitcoin companies at Consensus 2016. OB1 CEO Brian Hoffman, Blockstack Labs co-founder Ryan Shea, as well as Lightning CEO Elizabeth Stark were likewise featured on the panel. The panel was moderated past times Chamber of Digital Commerce President Perianne Boring.
The theme of rule came upward on multiple occasions during the panel discussion, as well as Voorhees, a song critic of diverse forms of Bitcoin-related regulations, did non agree dorsum inwards sharing his contempt for the diverse legal restrictions that convey been placed on Bitcoin (especially the New York BitLicense).
Voorhees made the indicate that traditional regulations ‒ when applied to Bitcoin or other blockchains ‒ are similar plumbing fixtures a “square peg into a circular hole.” Voorhees said that placing restrictions on the evolution of this novel fiscal technology scientific discipline would hold upward akin to requiring bloggers to transcend around kind of publishing license inwards the early on days of the Internet.
Why BitLicense Would Have Made the ShapeShift Hack Worse
Voorhees likewise used the multiple hacks as well as thefts he’s lately had to bargain amongst to brand a indicate near how traditional regulations should non hold upward applied to Bitcoin. In regard to the hacks, Voorhees stated:
“You tin bet that if nosotros had, for example, followed the New York Bitlicense as well as were taking personal, individual data of every unmarried client that was on our website, all of that personal as well as individual data would straight off hold upward inwards the hands of the hacker [and] all over the dark web.”
Voorhees has been extremely transparent amongst everything that has happened inwards relation to the hacks. He wrote a total written report of events, talked near it on the Bitcoin.com podcast, as well as answered farther questions for Epicenter Bitcoin.
The Blockchain Offers True Consumer Protection
One of the reasons Voorhees has a disdain for the BitLicense is that, inwards his view, it makes consumers less safe. For example, ShapeShift does non convey to collect practically whatsoever data related to their customers because crypto tokens run similar digital cash.
The fact that ShapeShift does non convey to collect data or funds from their customers removes a liability from the exchange’s side as well as increases safety for users.
“To me, that is truthful consumer protection through design, as well as that’s 1 of the magic things that blockchains allow,” Voorhees added.
New York is the entirely jurisdiction inwards the entire basis blocked past times ShapeShift. In this item case, it appears that ShapeShift made the right conclusion from a consumer protection perspective.
The postal service Erik Voorhees: Complying With BitLicense Would Have Made ShapeShift Hack Much Worse appeared starting fourth dimension on Bitcoin Magazine.
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