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It was impossible to rewrite the firmware to override that security measure.

It wasn't, however, totally safe: if you got physical access to the camera you could defeat this hardware interlock, but that was not part of the scope of this project.

The freshly-licensed Coinbase is a bellwether of what to expect from centralized bitcoin exchanges. No wonder decentralized exchanges, like Localbitcoins, are breaking their own volume records on a weekly basis. But for the cautious and the informed, they are a return to the privacy and financial freedom that made bitcoin a beacon.

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The first post in the thread captured the change and the dominant reaction to it.

Just tried to help a friend register an account and they’re demanding access to her webcam?!?!

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“we will require you to take a photo of yourself with your webcam”…no law or regulation requires this. Coinbase’s accelerated ID verification is part of its commitment to comply with Know Your Customer (KYC) and Anti-Money Laundering (AML) laws – two incredibly invasive measures that destroy financial privacy.

I have accounts with 3 brokerage firms, 2 banks, and Gemini, and none have ever demanded access to my computer’s hardware. Accessing our computer’s hardware is not required by… Coinbase’s new layer of verification uses facial recognition technology to correlate a live real-time face shot from a webcam or smartphone with the image of ID being submitted at the same time by an account applicant or with the data already on file for an account holder.

Not really all that hard; a lot of cameras just use a common set of components, and using FX2LP is very common for anything requiring 480Mbps USB, as is downloading the software on boot rather than storing it in non-volatile memory.

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Whatever the reason and unless there is a considerable downside, Coinbase is unlikely to forgo a process that protects it from government and provides commercially valuable data.

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