- Srinivasan said the situation becomes complicated ‘if we cannot trust the operating system itself’
- He proposed Linux as a potential alternative but expressed concerns about its scalability within the given timeframe
- His remarks received mixed reactions from the netizens
Crypto entrepreneur Balaji Srinivasan has cautioned on social media that authorities in the United States and other countries might attempt to coerce tech companies such as Apple and Google into extracting private keys from their devices and applications.
Srinivasan, who previously held an executive position at crypto exchange Coinbase, suggested that this action could be taken with the intention of transferring funds to governments in need of cash.
“Apple and Google are systemic risks to crypto. If weaponized by the federal government, they could backdoor iPhone and Android to exfiltrate private keys,” he tweeted last week.
In a thread, he further said that in the future, if owning enough Bitcoin becomes a significant political concern, financially distressed governments may seek to acquire portions of individuals’ cryptocurrencies.
“… in 2023, even after El Salvador has adopted Bitcoin, people still think it’s implausible to say “by the end of this decade, the most important political issue in the world may be whether bankrupt governments have sufficient Bitcoin to fund their operations,” he wrote.
In such a situation, according to Srinivasan, it seems unlikely that the U.S. government could easily execute a conventional 51% attack through mining. He added that while China might have the capability, most mining operations are now situated outside of the country.
As an alternative, he suggested that the federal government could attempt to compel tech giants like Apple and Google, along with other technology companies, to search for private keys stored on their servers, devices, and browsers. The aim would be to appropriate any acquired funds and redirect them to the financially strained government needing liquidity.
“This isn’t cyberterrorism, it’s cyberwar. It’s not some random hacker who manages to sneak out a file. It’s when the CEO of a company gives the lawful order to hack their customers. This is similar to what happened to 140M Russians designated enemies of the state in early 2022 — every tech company turned on their former customers,” he tweeted.
Srinivasan further said: “We’re talking billions of iPhones and Android phones, Mac laptops and Chrome browsers, Google Docs and Gmail. China could do the same with the Chinese smartphone manufacturers.”
According to him, the situation becomes complicated “if we cannot trust the operating system itself.” He proposed Linux as a potential alternative but expressed concerns about its scalability within the given timeframe.
Furthermore, Srinivasan mentioned that Linux-based devices may not be sufficient. He also considered exchanges built on Linux as a possible solution but said that they come with the drawback of being custodial and potentially vulnerable to similar attacks.
The ex-CTO’s remarks received mixed reactions from netizens. Several individuals emphasized the importance of having a dedicated phone for cryptocurrencies and suggested the newly released Solana phone. However, some raised concerns about the idea of storing private keys on mobile devices.
Earlier this month, Srinivasan prematurely ended a bet predicting that the price of Bitcoin would reach $1 million by mid-June due to the hyperinflation of the US dollar. He expressed his rationale in a blog post, stating, “I just sacrificed a million dollars to convey the message that they [referring to the authorities] are printing trillions.”