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Frances Haugen

Facebook whistleblower warns Metaverse will repeat ‘all the harms’

Frances Haugen, Facebook whistleblower at large, has now turned her focus to the Metaverse. She is worried about how Meta will handle privacy and intensely sensitive information.

Facebook whistleblower Frances Haugen has taken aim at Meta in a new interview, suggesting that its version of the Metaverse will simply repeat all of its past mistakes.

In an interview with Politico, Haugen said:

"They've made very grandiose promises about how there's safety-by-design in the Metaverse. But if they don't commit to transparency and access and other accountability measures, I can imagine just seeing a repeat of all the harms you currently see on Facebook."

In 2021 Haugen leaked thousands of internal documents from Facebook to the Securities and Exchange Commission and The Wall Street Journal. Her experience working for the company has left her with concerns about privacy issues and about letting the corporation amass data about every aspect of user’s interactions in the Metaverse.

"I'm super concerned about how many sensors are involved. When we do the Metaverse, we have to put lots more microphones from Facebook; lots more other kinds of sensors into our homes," she said.

"You don't really have a choice now on whether or not you want Facebook spying on you at home. We just have to trust the company to do the right thing."

Haugen isn’t the only one concerned. According to a recent survey, 70% of people don’t trust Meta to handle privacy properly.

Andy Yen, CEO of encrypted email service ProtonMail is also concerned with the unilateral powers of Big Tech giants like Meta. Last week, he said in an interview, that his own company, Proton, will only be able to survive based on the goodwill of tech giants.

“Tech giants could today remove us from the Internet with zero legal or financial repercussions,” he said.

Yen has also raised concerns about Big Tech controlling the Metaverse in the past, telling Newsweek last year that Meta was “building a new infrastructure where they control everything. They control the device, they have the VR headsets, you're now in their world, on their devices, on their platform."

Yen said that given their track record, he doesn’t believe we should trust Meta with power like that and that promises around privacy in the Metaverse are useless unless its business model changes.

"At the end of the day, their business model revolves on taking your data and monetizing it. So, there is fundamentally always going to be a conflict between what they say and what they actually have to do to make money.”

Data collection

The Electronic Frontier Foundation (EFF) is a nonprofit organization defending civil liberties in the digital world. Like Yen, it believes that VR headsets and AR glasses, and other wearables, will make data collection and surveillance easier than ever before. In December they stated:

“This data harvesting, sometimes done by companies with a history of putting profit before protections, sets the stage for unprecedented invasions into our lives, our homes, and even our thoughts.”

The EFF is concerned that data collected and used for targeted advertising will generate "biometric psychography" and that our deepest desires and inclinations will be up for sale. Once the information has been collated, the data could be monetized by third parties, even without our knowledge or agreement.

The China syndrome

While the Metaverse may seem like an issue for the distant future, in China, citizens are living it every day, in a different way.

WeChat is the social media platform of choice in China. It has a mind-boggling user base of over one billion. Of those, 850 million are active users. The app is amassing data about users in China on a scale never seen before. And, the Chinese government can monitor every word, picture and video on it.

WeChat came under heavy criticism from Reporters Without Borders (RSF) before the Winter Olympic Games earlier this year. RSF urged journalists to protect themselves against Chinese surveillance while reporting in-situ. They said, “RSF recommends journalists who travel to China to avoid downloading applications that could allow the Chinese authorities to monitor them.” These included WeChat and TikTok.

Imagine having that power over the Metaverse.

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Puerto Rico sees resurgence of interest among crypto rich

Crypto capital is moving to Puerto Rico as tax regulations are much more favorable than in the U.S. proper.

The United States territory of Puerto Rico is seeing a resurgence of interest among crypto investors attracted by the fact it doesn’t charge federal income tax and eligible investors can pay zero taxes on their crypto gains.

Under local law Act 22, those who live in Puerto Rico for at least half of the year are exempt from taxes on interest, dividends and capital gains — meaning they can keep most or all of the profits from crypto or other investments without having to renounce U.S. residency.

The popularity of the territory as crypto tax haven was highlighted when news stories emerged that Frances Haugen, the Facebooks whistleblower, had moved to Puerto Rico in March. But it's been a haven for crypto people for years, including Bitcoin billionaire Puerto Rico who owns a nine bedroom mansion there.

Logan Paul, the social media personality and Cryptozoo founder, moved to the island earlier this year where he rents out a $55,000 a month mansion. Paul told Time Magazine the island's tax free status was a big part of the appeal:

“In Puerto Rico you’re motivated to do more and make more money because of the implications that come with it.”

Crypto related businesses that have relocated to Puerto Rico in recent years include the hedge fund Pantera Capital from New York and NFT marketplace SuperRare from Silicon Valley. More traditional finance types like legendary hedge fund manager John Paulson have also become residents.

The Puerto Rico Blockchain Trade Association (PRBTA) recently announced the first edition of the Puerto Rico Blockchain Week for December of 2021, which aims to lure more crypto millionaires and investment into the island.

“We seek to connect entrepreneurs with communities in Puerto Rico and educate them on the multiple benefits available in the crypto era,” stated Keiko Yoshino, Executive Director of PRBTA.

The capital migration that crypto is bringing to Puerto Rico is boosting economic growth but comes with drawbacks for locals. Projects like Puertopia, which is a crypto utopian community in San Juan, are blamed for causing housing prices to soar.

Puerto Rico is not the only location competing for crypto dollars.

Related: Friendliest of them all? These could be the best places for crypto

Aiming to attract crypto investors and businesses El Salvador also offers major tax breaks on Bitcoin trading with investors exempt from paying capital gains and income tax on Bitcoin.

Other classic tax havens have a cryptocurrency friendly environment including Switzerland, the Cayman Islands and Malta. St Kitts and Nevis, which is home to “Bitcoin Jesus” Roger Ver, allows savvy crypto investors to avoid taxes and offers a citizenship by investment program and asset protection advantages for crypto millionaires and businesses.

In Portugal crypto traders and miners are exempt from income tax and in Apri the country approved the Digital Transitional Action Plan which will promote the creation of economical areas dedicated to encourage blockchain-based business.

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