Why You Should Think Twice Before Divulging Yours
Image credit: Tobias Tullius
Giving out your bitcoin or ethereum address to an unknown third-party is like giving someone read-only access to your checking account.
Anyone with your address can fire up a block explorer to view the ins and outs, coming and going. Your account’s entire history is on display.
Put your account number into this ethereum explorer to see for yourself. Or do the same on this bitcoin explorer.
While neither blockchain network has a focus on privacy, the ETH chain gives out much more information than you may prefer.
Let me give you an example …
The Ethereum network is a marvelous piece of tech, no doubt. The ledger acts as a platform for other projects to build upon. And therein lies the privacy issue.
All those thousands of ERC-20 tokens built on the network — Coinbase-available $OMG, for example — also spill into public block explorers.
Revealing your ETH address spills your ERC-20s into the public domain
So, if you hold ETH and ERC-20s within the same ETH account, transacting in one reveals all the others.
It goes like this: I send you some $BAT tokens from my main ETH address. You can now use a block explorer to see how much ETH I hold, along with the amount and value of all other ERC-20 tokens.
Type an ETH address into ethplorer to reveal ALL tokens in that account
Stablecoins, staking coins, anything running on ETH is open for public viewing.
Yet another advantage of ETH accounts is wallet variety. Mobile wallets, hardware wallets, desktop wallets — there are plenty of places to hold ETH and ERC-20s.
“You gotta keep ’em separated.”
The trick here is account segregation. Stash your long-term holdings in one wallet while keeping your public transactional funds in another. After all, it never hurts to spread your eggs across multiple baskets.
Now, you might be inclined to compare ETH to the WAX Blockchain and its non-fungible token explosion. Yes, anyone with your WAX Cloud Wallet address can see your entire collection of NFTs on AtomicHub.
However, there’s a distinct difference between showing off your collection of digital art and divulging your DAI balance. Not to mention, the WAX Blockchain doesn’t saddle users with upwardly spiraling gas fees.
Again, I’m not trying to incite an argument about one chain’s superiority over others. ETH and BTC and WAX — and many more! — all have unique functionality. That said, if privacy is a concern for you, take precautions when giving out your ETH address.