Concerns Raised On Wallet Security, What You Should Do
Meta Platforms Inc, the parent of popular social media platforms Facebook and Instagram, has recently enabled users to post their non-fungible tokens (NFTs) on these sites to showcase them online. However, its decision has raised questions about data security, given its past data breaches.
Meta announced that users could now connect their Metamask and Coinbase crypto wallets with Facebook and Instagram. Some crypto users raised doubts about how Meta might use the data generated from posting NFTs.
While announcing the NFT feature in a blog post, Meta, however, said: “We collect and organize public data from open blockchains, such as Ethereum, to provide this feature. From this public blockchain data, we can only identify which collectibles belong to collectors and creators when they connect their third-party wallets to Instagram.”
Interestingly, in July, Meta announced closing down its crypto wallet service Novi, formerly Libra.
It had developed the wallet to enable borderless payments through crypto and fiat currency, and decided to wind up the project after drawing flake from the authorities in many countries.
The company had also been in the news for letting third-party access user data.
Meta’s Track Record Of Handling User Data
Cambridge Analytica, a now-defunct British political consultancy firm, which worked for the 2016 Trump campaign, was accused of harvesting Facebook’s user data from a quiz app in 2015.
Christopher Wylie, a former employee of the UK firm, blew the whistle on the data breach. Wylie alleged that it used personal data to make some 50 million illegal profiles of people.
However, Meta has settled the lawsuit involving Cambridge Analytica.
Nonetheless, it was not the only case concerning Meta’s data safety.
2021 Data Breach: In April 2021, Business Insider reported that a hacking forum posted the personal data of 533 million Facebook users. Of the victims, some 32 million were from the US, 11 million were from the UK, and six million were from India.
According to the report, the data, including phone numbers, Facebook IDs, names, localities, birthdates, and in some cases, email addresses, was posted online for free.
Concerns About Wallet Security
The crypto community is doubtful about the security and safety of the wallets and the NFTs stored in them, citing the past track record of Meta. For instance, one tweeple with the handle NPC-Picac said: “I don’t think entrusting digital collectibles to connect to ‘Meta’ is in any way smart.”
With Facebook having lost the data of
5 million users, 2013
14m, 2018
50m, 2018
600m, 2019
540m, 2019
1.5m, 2019
419m, 2019
309m, 2019
533m, 2021I don’t think entrusting digital collectables to connect to “Meta” is in any way smart https://t.co/1V6ycTvJji
— NPC-Picac (@PicacKc) August 29, 2022
Another crypto community member was concerned about how Meta might use the data generated from posting NFTs. He expressed concern that Meta might link the collected public blockchain data with its existing database.
So they can figure out which wallets are yours and keep tabs on you and your crypto activities? This is worse than the government iwo. https://t.co/JoGsE46U2p
— CryptoBARTENDER (@CryptoBartender) August 29, 2022
How To Make Wallets Secure
Use two-step verification if you use a custodial wallet like the Coinbase wallet. Also, enable Google Duo or Google authenticator on the Coinbase wallet app. In the case of non-custodial wallets, use multisigs, meaning break down your private key and store them in different locations. You could also write them on paper or store them on offline storage devices. And always use a hardware wallet for the best security cover.
Amanjot Malhotra, country head at Bitay, a crypto exchange, said: “Although they are technically connected to the internet during a transaction, the signing of the transaction by the private keys is done offline within the hardware wallet itself before being sent online to the blockchain to be confirmed. For this reason, even a malware-infected computer or phone can’t access your funds when you’re using a non-custodial hardware wallet.”
Om Malviya, President of blockchain company Tezos India, said, “Digital wallets are prone to phishing attacks so users need to be extra cautious while connecting on unknown dapps, signing transactions but still the power lies with the user unlike centralized exchanges. Ledger and other hardware wallet companies are improving on safety and easy access for users.”
