Centralized intermediaries have become deeply ingrained in the crypto user experience, serving as the primary avenue for adoption.
MetaMask, the leading provider of crypto wallets, faced criticism last week for altering its terms of service to disclose that it was sharing user IP information with Infura, a blockchain infrastructure developed by MetaMask’s creator ConsenSys.
ConsenSys, a research and development company led by Ethereum co-founder Joe Lubin, created MetaMask to provide users with a convenient way to store and trade their crypto without having to rely on centralized exchanges like Coinbase and Binance. These platforms store or “custody” funds on behalf of users.
Compared to “cold” wallets that store crypto keys on a USB thumb drive, MetaMask, a “hot wallet,” is installed on your phone or web browser and remains connected to the internet. Although it is convenient to only have to remember a username and password, rather than keeping track of a physical thumb drive, “hot wallets” are theoretically more susceptible to attacks and information leaks due to their constant internet connection.
MetaMask hot wallets are theoretically considered to be more private and secure than centralized exchanges. However, the recent discovery that MetaMask was sharing IP information with Infura caused concern among users who were upset to learn that their identifying information could have been leaked, compromising the privacy of their transaction history.