How Bitcoin Could Have Saved Ashley Madison Users

For those that don’t know, Ashley Madison is a website that allows people to sign up to find people to have an affair with. As their slogan says, “Life is short. Have an affair.” And as is always the case on the Internet, there is always a website for something. Anything. Everything.

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Today it was revealed that the site had been hacked with very sensitive information being taken by the hacker, including credit card information, full names, addresses, etc. In other words, it is the perfect data dump that a hacker looking to blackmail people would want to take. Imagine the high-wealth individual using the site who is now blackmailed because he or she was using the site to find someone to cheat with.

But here’s the thing …

None of that data was necessary. Why does a site that trumps itself as a site for indiscretion need full names and addresses? If the site is meant to give people a way to live a duplicitous life, lying to their loved ones, isn’t it pretty poor form to store all of that data?

The reason that it is stored is because all of that data is necessary for the use of a credit card. Think about the last time you purchased something on an ecommerce site: you needed to put your full billing information because that is the way that they verify that you are, in fact, the person who should be using that credit card.

And because Ashley Madison is charging you regularly, they need to store that data so that they can continue to run your credit card without asking you. So what you’re left with is a company that has your name, address, credit card number, and other personal information. And then the hacker can take that data and compare it to the account you’ve signed up with so that they can effectively prove that you are having an affair.

Bitcoin Would Have Prevented This

The thing is, this could have all been prevented. There is zero reason that I need to give all of my life story over to a company just so that they can take some of my money. And that isn’t just for a site like Ashley Madison. Even an ecommerce site shouldn’t need to take all of my information.

With bitcoin, none of this information is required. All that is required is that the funds are sent to the wallet of the website that you are purchasing from, whether that’s Ashley Madison or Amazon. After confirmation, the site knows that you do, in fact, have the funds to pay and you get to rest easy knowing that none of your data is being stored.

This is the same reason that bitcoin has seen increased use for porn. Rather than having to put a credit card in to one of these sites — which charge ridiculous fees — the porn star can simply accept bitcoin. This would result in a decrease in total fees that the porn star has to pay, but just as important, the individual wouldn’t have to worry about anyone ever knowing that they are a member of that site.

Bitcoin is Pseudonymous, Not Anonymous

Despite what you have heard about bitcoin, it is terrible at being an anonymous tool for commerce. The reason is because everything is publicly stored on the ledger. I can go look now and see that there were funds sent from one person’s wallet to another person’s wallet. If Ashley Madison’s wallet was publicly known, I could see every time someone paid Ashley Madison.

But the thing is, just because I know that there is a wallet that is paying Ashley Madison, I wouldn’t know who owns that wallet. I know that a transaction took place, but I don’t know who the payer is. That’s what makes it pseudonymous.

Credit Cards on the Internet are Dangerous

So offer to accept bitcoin. Teach your users how to transact in bitcoin because the reality is, it is becoming easier to gain access to a website’s database and all of that precious information is available at the whim.

And for those users of Ashley Madison that do decide to come back even after all of this, you should really insist on the company accepting bitcoin payments. While I don’t personally believe in cheating, if you’re going to do it, actually be discrete. Your credit card is far from discrete.