Yesterday, 1Password made the following announcement:
Cryptocurrency? We got you. 💸— 1Password (@1Password) February 23, 2022
We’ve partnered with @phantom to create a simpler, more secure way to manage cryptocurrencies, tokens and NFTs on the @solana blockchain. Get started: https://t.co/yzcDqrWo06
I am very unhappy about this.
As of this writing, the replies to this announcement are, by my count, roughly 95% paying customers who are furious with them for doing this, 3% scammers who are jubilant that this is popularizing their scamming tool of choice, and about 2% blockchain-enthusiasts expressing confusion as to why everyone is so mad.
Scanning through that 2%’s twitter bios and timelines, I could see content other than memes and shilling, so it seemed at least plausible to me that these people are scam victims who haven’t gotten to the blow-off yet, and their confusion is genuine. Given that “why is everyone so mad” is a much less intense reaction than fury or jubilation, I assume that many others read through some of the vitriol and had this reaction, but then didn’t post anything themselves.
This post is for two audiences: that 2%, genuinely wondering what the big deal is, and also those who have a vague feeling that cryptocurrency is bad, but don’t see the point of making much of a fuss about it.
This is why we should make a fuss about it.
The objection most often raised in the comments went something like this:
This is just a feature that you don’t like; if it’s not for you, just don’t use it. Why yell at 1Password just for making a feature that makes someone else happy?
To begin with, the actual technical feature appears to be something related to auto-filling in browser-extension UI, which is fine. I don’t object to the feature. I don’t even object to features which explicitly help people store cryptocurrency more securely, as a harm reduction measure.
Also, to get this out of the way now: cryptocurrency is a scam. I’m not going to argue the case for that here. Others have made the argument far more exhaustively, and you can read literally hundreds of pages and watch hours of video explaining why by clicking here.
The issue is with the co-marketing effort: the fact that 1Password is using their well-respected brand to help advertise and legitimize scam-facilitation technology like Solana and Phantom.
Even if we were to accept all this, it’s a scam, 1Password is marketing it, etc, my hypothetical blockchain-curious interlocutor here might further object:
What’s the big deal about legitimizing these things, even if they are fraud? Surely you can just not get defrauded, and ignore the marketing?
That’s true, but it also misses the point: legitimizing and promoting these things does various kinds of harm.
More broadly, although I’m writing about 1Password’s specific announcement here, and a small amount of the reasoning will be specific to password management tools, most of the concerns I’ll describe are fairly general to any company promoting or co-marketing with cryptocurrency, and thus hopefully this post will serve for future instances where we should tell some other company to stop supporting blockchains as well.
So with all that out of the way, here are some of the harms that one might be concerned about, from the least selfish concern to the most.
Concern #1: the well-being of others
I don’t know how to explain to you that you should care about other people, but if you do care about other people, this could hurt them.
First and foremost, the entire scam of cryptocurrency rests upon making people believe that the assets are worth something. Most people are not steeped in the technical minutiae of blockchains, and tend to trust things based on institutional reputation. 1Password has a strong brand, related to information security, and they’re saying that cryptocurrencies are good, so it’s likely to convince a nonzero number of people to put their money into this technology that has enormous non-obvious risks. They could easily lose everything.
Advertising 1Password in this way additionally encourages users to maintain custody of their own blockchain assets on their own devices. Doing so with 1Password is considerably less risky than it might be otherwise, so if this were to only reach people who were already planning to store their wallets on their own computers, then great.
However, this might encourage users who had not previously thought to look at cryptocurrency at all to do so, and if they found it via 1Password they might start using 1Password to store their first few secrets. Storing them in this way, although less risky, is still unreasonably risky, given the lack of any kind of safety mechanisms on blockchain-backed transactions. Even if they’re savvy enough not to get scammed, nobody is savvy enough not to get hacked, particularly by sophisticated technical attacks which are worth leveraging against high-value targets like people with expensive crypto wallets on their computers.
To be clear, crypto exchanges are, on average, extremely bad at the job of not getting their users money stolen, but individual users are likely to be even worse at that job.
Concern #2: economic damage
If you don’t care about other people much, but you still care about living in a functioning society, then the promotion of blockchain based financial instruments is a huge destabilization risk. As Dan Olson explains in the devastating video essay / documentary Line Goes Up, blockchain-based financial instruments share a lot of extremely concerning properties that made mortgage-backed securities and collateralized debt obligations so financially toxic in the 2008 crash. Large-scale adoption of these things could lead to a similar crisis, or even worse, a global deflationary spiral in the style of the one that caused the great depression, setting off the kind of economic damage that could result in mass famine and mass death.
Of course, any individual company or celebrity advertising crypto is not going to trigger an immediate economic collapse. Each of these is a snowflake in an avalanche. I have no illusions that convincing just 1Password to stop this is going to turn the tide of the entire blockchain catastrophe that is unfolding all around us, or indeed that my one little post here is going to make the decisive difference between, 1Password stopping vs. not.
But that’s exactly why I’m trying to persuade you, dear reader, that this is a big deal and we should all try to work together to stop it.
Concern #3: environmental damage
While this specific blockchain is “greener” than others, but given the huge proportion of cryptocurrency generally that is backed by electrical waste, and the cultural and technical incentives that make trading one blockchain asset for another more common than cashing out to dollars, it’s still a legitimate concern that promoting blockchain in general will promote environmental destruction indirectly.
Furthermore, the way that Solana is less energy-intensive than other blockchains is by using proof-of-stake, so there’s a sliding scale here between economic and environmental damage, given that proof-of-stake is designed to accelerate wealth accumulation among non-productive participants, and thereby encourages hoarding. So the reduction in environmental damage just makes the previous point even worse.
Concern #4: increased targeting risk
Even if you’re a full blown sociopath with no concern for others and an iron-clad confidence that you can navigate the collapse of the financial system without any harm to you personally, there is still a pretty big negative here: increased risk from threat actors. Even if you like and use blockchain, and want to use this feature, this risk still affects you.
If 1Password happened to have some features that blockchain nerds could use to store their secrets, then attackers might have some interest in breaking in to 1Password, and could possibly work on tools to do so. That’s the risk of existing on the Internet at all. But if 1Password loudly advertises, repeatedly, that they are will be integrating with a variety of cryptocurrency providers, then this will let attackers know that 1Password is the preferred cryptocurrency storage mechanism.
This further means that attackers will start trying to figure out ways to target 1Password users, on the assumption that we’re more likely to have crypto assets lying around on our filesystems; not only developing tools to break in to 1Password but developing tools to fingerprint users who have the extension installed, who have accounts on the service, whose emails show up on the forum, etc.
Now, of course, 1Password users keep plenty of high-value information inside 1Password already; that’s the whole point. But cryptocurrency is special because of the irreversible nature of transactions, and the immediacy of the benefit to cybercriminals specifically.
If you steal all of someone’s bank passwords, you could potentially get a bunch of their money, but it is expensive and risky for the criminals. The transactions can be traced directly to actual human account holders immediately; anti-money-laundering regulations mean that this can usually be accomplished even across international borders. Transfers can be reversed.
This discrepancy between real money and cryptocurrency is exactly why ransomware was created by cryptocurrency. It makes cryptocurrency attractive specifically to the kinds of people who have expertise and resources to mount wide-spectrum digital attacks against whole populations.
Of course, if they develop tools to fingerprint and hack 1Password users, but they don’t luck out and find easy-to-steal crypto on your computer, they might as well try to steal other things of value, like your identity, credit information, and so on. These are higher-risk, but now that they’ve built all that infrastructure and hacked all these machines, there’s a big sunk cost that makes it more worthwhile.
I really hope that 1Password abandons this destructive scheme. Even if they fully walk this back, I will still find it much harder to recommend their product in the future; there will need to be some active effort to repair trust with their user community. If I’ve convinced you of the problems here, please let them know as a reply to the tweet, the email linked from their blog post, their community forum, or the Reddit post of the announcement, so that they can get a clear signal that this is unacceptable.