Karsten Wenzlaff, Advisor
August 26th, 2025
Karsten Wenzlaff is a Crowdfunding and Fintech Expert from Germany. He is Secretary-General of Digit[...]
Category Archives: Regtech, Compliance, Governance
Perplexity’s Security Flaws A Red Flag for Industry
AI Security | April 22, 2025
Image: Freepik/atlascompany
Why Perplexity's App Flaws Should Alarm Anyone Building with AI
Perplexity AI is growing fast with over 10 million Android downloads and is backed by tech royalty like Jeff Bezos but a new security report by a Singapore security firm AppKnox found major vulnerabilities that could be exploited by attackers. We're not talking small potatoes here. We're talking about huge issues like hardcoded API keys and significant weaknesses against any sort of malicious hacking.
See: Perplexity AI Sued for Copyright Infringement
While Perplexity's android app isn't what most fintechs run their AI service on, it's a red flag about the state of security in the quickly evolving world of artificial intelligence tools that banks, wealthtech platforms, and credit unions are exploring, embedding, investing and integrating in..
What Appknox Found in Perplexity’s Android App
Perplexity’s Android app includes private access keys that should not be exposed. These keys work like internal passwords and were stored inside the app itself. This makes it easy for anyone with technical skills to find and misuse them. These hardcoded credentials could be downloaded and used to access Perplexity's AI full system completely for free.
Another serious problem is that the app does not check if it is connecting to a real or fake server. Cybernews reports that someone on public WiFi could take advantage of this to spy on what users are doing. This might include watching what they search, type, or log in to.
The app has not fixed several known security flaws that have existed in Android for years, such as StrandHogg and Janus are still present. These are weaknesses that hackers already understand and can use to gain control or access private information.
Perplexity's app doesn't check if a phone is rooted or not, and it's less secure if it is.
The app’s code is also not protected. This means someone could open it up, look inside, and understand exactly how it works. They could then use this to find more vulnerabilities to attack or copy its features.
See: Why No Code AI Agents Matter for Fintech in Canada
The app can be tricked into letting attackers control parts of the screen without the user knowing. So, you could be typing into a pop-up form or something that looks familiar but it's actually a trap that can steal your information.
Implications Even If You Don’t Use the App
How is it possible that a high profile AI unicorn like Perplexity ships a mobile app that fails basic security checks? If they are missing the basics, how many others are? This raises a critical question for fintechs and financial institutions looking to integrate AI whether it's a chatbot, SDK, API, or embedded assistants.
Are you checking how secure your vendors really are?
It's a reality check that a soaring valuation doesn’t guarantee strong engineering discipline.
Some Security Questions You Should Be Asking
Where are the API keys stored? If they live in the mobile app code, that’s a no-go.
Does the vendor use SSL validation and pinning? If not, data can be intercepted over public WiFi.
Are known vulnerabilities patched? Run a third party scan or ask for one.
See: Is AI Going to Change Fintech Security?
Is the code protected? If it’s not, attackers can easily reverse-engineer how it works.
Does the app detect rooted or jailbroken devices? If not, it might be operating in a compromised environment.
What’s the vendor’s breach response plan? Ask how they handle disclosures, patches, and updates.
How much access are you really giving? Use API scopes, rate limits, and narrow permissions by default.
Conclusion - You Don’t Have to Use the App to Learn from It
Perplexity's Android app glaring security risks is a textbook example of what happens when security gets left behind in a rush to launch/scale products out the door. Don't ever forget that financial data isn't forgiving when it leaks. Whether you're exploring AI for customer support, product recommendations, or internal workflows, you need to prioritize the app and API security for your use case. Trust is earned but it can be lost in a heart beat.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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Meta Faces U.S. and Canadian Legal Pressure
Antitrust | April 21, 2025
Image: Freepik/upklyak
Meta Faces U.S. Monopoly Trial and Rising Global Scrutiny
The U.S. Federal Trade Commission (FTC) first sued Facebook (now called Meta Platforms Inc.) in December 2020, claiming it broke competition laws by buying Instagram and WhatsApp to suppress competition and maintain a monopoly in personal social media markets. The case was renewed in 2021 with more evidence and the trial started on April 14, 2025, with Mark Zuckerberg already on the stand in the U.S. District Court for the District of Columbia.
The FTC argues Meta bought Instagram for $1 billion in 2012 and WhatsApp for $19 billion in 2014 in what they call a 'buy or bury' strategy to dominate the market, which it now controls -see FTC opening statement slides:
- 78% of monthly active users (MAUs)
- 77% of daily active users (DAUs)
- 85% of total user time spent on social platforms in the U.S.
See: Meta to Appeal €798M EU Fine for Antitrust Violations
During the trial, FTC presented internal messages/texts in 2012 from CEO Mark Zuckerberg, saying:
“It is better to buy than compete.”
The FTC now seeks a court order that could force Meta to breaking-up or divesting Instagram and WhatsApp entirely.
Meta Says Not a Monopoly, Just Competition
On April 13, 2025 in an official Meta blog post, Meta’s Chief Legal Officer Jennifer Newstead says that the FTCs case is 'weak' and that the lawsuit is wrong, saying it ignores how competitive the tech space has become. She argues that platforms like TikTok, YouTube, Snapchat and others fiercely compete for users' time and attention and that the FTC is using a narrow definition for personal social networking. She continues to say that Instagram and WhatsApp grew under Facebook/Meta's ownership because of the investments in safety, encryption, and performance.
Canadian Legal Action Against Meta
While Canada has not filed a federal antitrust lawsuit like the FTC, there are a number of legal and regulatory actions against Meta including:
1. Canada passed the Online News Act (Bill C-18) in June 2023 to help struggling news publishers that required big tech platforms like Meta to pay Canadian outlets when they share or link to their news. The expectation is that platforms like Meta and Google are to contribute at least $100 million CAD annually to support the sustainability of the Canadian news industry. Meta responded by blocking all Canadian news content from Facebook (now Meta) and Instagram feeds. So in response, News Media Canada and CBC filed a complaint with the Competition Bureau, arguing that Meta’s move was anti-competitive and harmful to the public, which the Bureau is currently investigating.
See: Implications of Meta’s Fact-Checking Exit
2. In 2024, four Ontario school boards sued Meta, TikTok’s parent ByteDance, and Snapchat’s owner Snap Inc., asking for over $4 billion CAD in damages. They claim the platforms were designed to be addictive, harming students mental health and learning. The companies tried to get the case thrown out but an Ontario judge ruled that the case proceed which now has expanded to 14 school boards. The boards say they've had to spend more funding on mental health and classroom supports because of social media's impact, and want the platforms redesigned to reduce harm to students.
3. In 2024, Canada passed the Digital Services Tax Act, introducing a 3% tax on revenue earned in Canada by large global tech companies like Meta. It applies to companies with more than €750 million in global revenue and at least C$20 million in Canadian digital revenue. The first payments are due by June 30, 2025. The tax was delayed for years during global talks but Canada moved ahead after little progress. Meta opposes the digital services tax, and it's not a secret that President Trump dislikes the tax too, and we can expect it to be raised when renegotiating the Canada-United-States-Mexico-Agreement (CUSMA) trade agreement. Revenue collection is proceeding with its first collection in 2025.
Implications for Fintechs and Investors
We're at a regulatory turning point against big tech. From Washington to Ottawa, digital platform dominance is in the spotlight. The outcome of Meta's trial, as well as Canada's legal pressures could lead to new enforcement models, investment opportunities, and an increase in competition in areas that have been long dominated by Big Tech.
See: Meta’s Vision to Swarm Facebook With AI Users
Also, smaller firms operating in AI, digital media, and user engagement platforms may find that regulators are more willing to intervene or step in/up if complaints are made.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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Google’s Ad Tech Monopoly Ruled Illegal by U.S. Court
Antitrust | April 21, 2025
Image: Freepik/fabrikasimf
Google Hit With Second Antitrust Ruling as Court Calls Out Monopoly
On April 17, 2025, a federal judge ruled that key parts of Google's digital advertising ecosystem is a monopoly and it broke antitrust laws. It's the second time in less than a year that Google has been found guilty of abusing market power. The case was led by the U.S. Department of Justice (DOJ) and was backed by 17 states.
Judge Leonie Brinkema ruled (115 page PDF)that the company “willfully engaged” in tactics that harmed competition and distorted prices in a way that left publishers and consumers worse off while strengthening Google's dominance. Could this result in a court ordered break-up of Google's advertising tech empire?
How Google Controls the Ad Market
The case focused on how Google linked its publisher ad server (DFP) with its ad exchange (AdX), tools used by websites to sell advertising. The court found that its an unfair combination that Google could control and steer traffic away from competitors, giving it monopolistic control over the ad ecosystem.
See: Canada Sues Google Over Anti-Competitive Ad Practices
By 2022, Google held over 90% of the publisher ad server market and between 55-65% of the ad exchange space. In Q4 2024, its advertising business brought in $72.5 billion or 75% of Alphabet's total revenue (see Alphabet's Q4 2024 Earnings). These are astonishing figures and akin to how the internet is monetized.
So Now What?
The court has ordered both parties to schedule a hearing to submit potential remedies to resolve Google's antitrust case, including ordering the break-up and divestiture of AdX and DFP. The outcome will likely change how digital ads are bought and sold on the internet.
CNN article says Google will appeal. “We won half of this case and we will appeal the other half,” said Lee-Anne Mulholland, Google’s VP of regulatory affairs.
Not Google's Only Battle
Last August 2024, a separate court ruled that Google illegally monopolized search by paying Apple over $10 billion a year to be the default engine on iPhones. The DOJ reportedly wants Google to sell Chrome and potentially it's Android operating system.
Google is also facing broad existential threats from the rise of generative AI platforms like OpenAI's ChatGPT that are upending traditional search by fundamentally changing how people access information.
Let's not forget the added pressures that President Trump' sweeping tariffs on global tech are having on Google's revenue growth. Combined, Google's dominance is now in flux with Alphabet's stock falling more than 1% after the latest ruling and down 20% year to date.
What This Means for Canada
Canada’s Competition Bureau is watching closely, and in November 2024 filed its own antitrust suit against Google, claiming the company used similar tactics in Canada’s digital advertising market.
See: Trump’s Inauguration Marks New Chapter for Tech Giants
According to Commissioner Matthew Boswell, Google’s ad tech practices prioritized its own products in ad space auctions and restricted publishers from working freely with other platforms. Similar to the U.S. case, Canada seeks a forced sale of ad tech tools, financial penalties, and an end to exclusionary behaviour.
If the Tribunal agrees, Google could face fines up to 3% of its global revenues ~$12 billion CAD. These cases can take several years to conclude but Canadian regulators have been building their case for almost a decade, and the U.S. ruling may accelerate momentum, as it provides a strong legal precedent.
One Tech Giant Wobbling. Who’s Next?
U.S. regulators are not just going after Google but also currently pursuing Meta, Amazon and Apple for various antitrust violations.
Apr 2025: Meta for acquiring Instagram and WhatsApp to eliminate rivals.
Mar 2024: Apple for using the iPhone ecosystem to block competitors in messaging, digital wallets, and more.
Nov 2023: Amazon for allegedly punishing third party sellers and distorting its own marketplace.
Conclusion
Big Tech is being forced to answer how it gained and uses power, with Google now on the chopping block who may now face a court ordered breakup. Canada and other countries are following, so this antitrust case isn't about one company but a movement and will impact who controls the infrastructure of the internet.
TedX: This is what a digital coup looks like
It doesn't matter if you're in advertising or not. It affects anyone who uses the internet and the outcome will change how online markets work, who gets to participate and compete and the future of digital power.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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Does CUSMA Support Fintech Services Across Borders?
CUSMA | April 16, 2025
Image: Freepik/rawpixel.com
Fintechs and Digital Finance Firms Can Still Scale in the U.S. and Mexico
If you’re building a fintech company in Canada, there’s a good chance you’ve thought about scaling into the U.S. or Mexico. But no doubt rising trade tensions and ever evolving regulations can raise questions about CUSMAs current status for financial technology service providers.
Earlier this month, President Trump introduced wide sweeping tariffs (he referred to as 'Liberation Day') on imports from more than 180 countries. Canada and Mexico were largely exempt (for now) thanks to the Canada-United States-Mexico Agreement (CUSMA/USMCA), which replaced the North American Free Trade Agreement (NAFTA) in 2020.
See: Digital Export Trends and Global Trade Fintech Opportunities
CUSMA includes specific rules that make it easier for digital finance providers to operate across borders. Whether you're running a payments platform or a digital lending service, CUSMA could already be working in your favour.
What Fintechs Need to Know About CUSMA
Chapter 17 – Financial Services
If you operate a regulated fintech like one that moves money, offers loans, or handles investments then Chapter 17 – Financial Services is what applies to you. It helps you access the U.S. and Mexico markets but doesn’t fully protect you from things like local data rules, and applies to financial services such as:
- Digital banking and payments
- Lending, insurance, or wealth management
- Embedded finance products tied to licensed providers
See: Overcoming Barriers to Growth in Financial Regulation
Chapter 17 legally ensures market access and fair treatment but it doesn't stop governments from requiring certain data to be stored locally. So if you're offering regulated cross border services, your operations could still face compliance hurdles around data infrastructure.
Chapter 19 – Digital Trade
If your business focuses on digital tools that support, but don’t directly provide financial services, then you might fall under Chapter 19 - Digital Trade. Chapter 19 lays out stronger protections for items like cross-border data flows and electronic transactions but it doesn’t apply to regulated financial services. Some business model examples that may qualify under Chapter 19 include:
- Digital contracting or e-signature platforms used in financial workflows, such as mortgage pre-approvals or investment account setup
- Financial literacy and education platforms that help users understand credit, debt, or budgeting without offering licensed advice or handling money
- Tax prep or compliance reminder tools that provide content or automation but don’t process payments or require regulatory oversight
See: Insights from Jamie Dimon’s 2024 Letter to Shareholders
If you’re unsure where your business fits, it’s advised to contact your export trading representative or if you need help with CUSMA compliance you can contact CanadExport CUSMA compliance support line at 1‑833‑760‑1167. Alternatively, it's worth getting legal advice to help classify your service correctly to avoid unnecessary risks under CUSMA protections.
What About the New U.S. Tariffs?
During March and April of 2025, the U.S. government announced tariffs on over 180 countries, igniting global trade anxiety. Canada and Mexico were mostly exempt but only for products and services that are compliant with CUSMA (not for sectors like Steel and energy), and the pressure has forced Ottawa and allies to diversify supply chains to protect economic sovereignty.
After speaking with President Trump, Prime Minister Mark Carney called the old U.S.–Canada trade relationship “over” and is now pushing for a broad renegotiation of CUSMA and defence security to reflect Canada’s modern priorities. He announced a 25% retaliatory tariff on U.S. autos that do not meet CUSMA standards, further escalating pressure around trade terms.
See: Carney Shakes Up Leadership and Vows to Protect Canada
For financial technology firms, the current economic environment is volatile with new tariff threats being contemplated by the Trump administration day by day, so stay current with evolving trade rules and do not assume that rules of 2020 still protect your business in the say way in 2025.
Why It Matters
For Canadian fintechs still looking to scale into the U.S. or Mexico, CUSMA still provides a foundation to operate if you know how to use it. Make sure you understand the classification of your business and revenue exposure across borders. This is a time of rising trade barriers, so any clarity around CUSMA could be a competitive advantage to support your growth.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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IRS Crypto Rollback Raises Questions for Canada
Crypto Regulation | April 15, 2025
Image: Freepik/rawpixel.com
Trump Repeals IRS Crypto Reporting Rule. Here's Why Fintechs in Canada Should Pay Attention
On April 10, 2025, U.S. President Trump signed a bill cancelling a key IRS crypto reporting rule that would have required decentralized finance (DeFi) platforms to report customer transactions to the tax agency.
See: UK FCA Plans Full Crypto Licensing Regime by 2026
The IRS' rule was called "Gross Proceeds Reporting by Brokers That Regularly Provide Services Effectuating Digital Asset Sales", which expanded the scope of traditional broker definitions to include DeFi apps like Uniswap and Metamask, and had an effective date of February 28, 2025. However, the IRS provided a transition period given the reporting complexities involved, so the rule was set to apply to digital asset sales occurring after January 1, 2027. But with Trump's bill nullifying the IRS rule, the implementation is now cancelled and the rule is officially gone.
What does this mean for fintechs, crypto startups, and regulators in Canada?
What Changed?
The IRS crypto reporting rule was part of a broader push to increase tax compliance among crypto users but industry argued that it wasn't manageable because DeFi platforms don't control their user's data. Often, there isn't a centralized entity to collect or report it. Develops were also at risk of facing penalties for software they didn't directly operate.
Industry associations and legal experts warned that the IRS's rule would push DeFi innovation offshore, so Congress listened and used the Congressional Review Act, and the House voted to repeal the rule on March 11.
See: Circle Files for IPO as Crypto Firms Eye Wall Street
Then the Senate did too with 70-28 bipartisan support on March 26. Now the bill has been signed into law and you can read it here.
Why It Matters to Canadian Fintechs
The repeal of the IRS DeFi crypto reporting rule signals again that the United States is backing away from aggressive regulation on crypto and decentralized platforms. It puts pressure on other jurisdictions including Canadian policymakers to clarify their own positions. Canada recently implemented it's own crypto reporting rules which the Canadian Revenue Agency (CRA) will start enforcing by 2027.
With the U.S. now seemingly a more welcoming environment for DeFi developers, Canada risks falling behind, especially if companies and capital start shifting strategies and offices to the U.S. for more flexibility and fewer rules. With the IRS rule now gone, DeFi projects based in the U.S. may suddenly look more appealing to venture capital and institutional backers. If that's the case, then Canadian fintechs would be at a disadvantage if local policies become too burdensome or vague.
Canadian users engaging with U.S. DeFi platforms may now face uncertainty over how these transactions should be reported domestically, given that there will be no equivalent enforcement on the U.S. side of the border. As such, the CRA may need to update guidance to avoid future confusion.
See: The Crisis Canada and Fintech Can’t Afford to Waste
With jurisdictions like the UAE, Singapore, Hong Kong, and the UK positioning themselves as global crypto centres, and the U.S. now looking like to be rejoining the global race, Canada will need to decide whether it can keep pace and remain competitive, or risk falling behind. The window to design a more innovation friendly approach to help strengthen Canada's role as a global fintech hub will only be open for a short time.
Outlook
Now is the time to ask tough questions about competitiveness, policy leadership, and how we balance innovation with responsibility. If we want to shape the future of financial services, we need to act quickly and wisely.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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SEC Issues Covered Stablecoin Statement, Risks Remain
Regulation | April 10, 2025
Image: Freepik
SEC Says Some Fully Backed, Payment-Only 'Covered Stablecoins' Aren’t Securities
On April 4, 2025, the U.S. Securities and Exchange Commission (SEC) issued a statement that clarified some U.S. dollar-backed stablecoins may not be considered securities. While the statement was welcomed and creates some breathing room for crypto and fintech projects, the announcement ignited an internal debate at the SEC and many are wondering what's next.
Covered Stablecoins
The SEC said certain U.S. dollar-backed stablecoins (referred to as 'Covered Stablecoins') are not considered securities if they have all of the following characteristics:
- Stablecoin must maintain a 1:1 fixed value equal to the U.S. dollar, without fluctuations
- Each stablecoin must be fully backed by an equivalent amount of high quality assets such as U.S. Treasury bills, cash, or cash equivalents that can be redeemed on demand. These assets must be held in custody and verified regularly
- No expectation of profit - cannot be promoted as an investment or marketed in a way that leads buyers to expect profit from simply holding the token
See: U.S. Senate Moves to Regulate Stablecoins
- No voting rights, control over the issuer, or shares in any profit or management decisions (no governance)
- Stablecoin must be designed and used as a method of payment only (no speculation of yield)
- Issuers must make public, regular, and accurate disclosures about the reserves backing the stablecoin, how redemptions work, and any related risks
- Algorithmic stablecoins or stablecoins that offer yield (interest, rewards, or staking returns) are excluded
Basically, a 'covered stablecoin' must behave like digital cash, and used for payment transactions, fully backed, and free of any rights, ownership or expectation of profit. If the token acts like cash (and not a stock) then it likely isn't a security. This offers a clearer path for some stablecoins like USDC or USDP.
Internal SEC Debate
Not everyone at the SEC agrees with the above perspective though. On the same day, Commissioner Caroline Crenshaw published a statement titled "'Stablecoins' or Risky Business" warning that most people acquire stablecoins through intermediaries like a crypto exchange, and in many cases they don’t have the legal right to redeem them directly. This creates a risk for retail purchasers who may think that these coins are safer than the really are. Crenshaw highlighted that these tokens can still break their dollar peg or have liquidity issues, especially in a crisis.
Caroline Crenshaw, SEC Commissioner argued that the statement "downplays the risks associated with stablecoins," saying that "over 90% of these stablecoins are distributed through intermediaries, leaving retail holders without direct redemption rights and exposing them to potential market volatility."
See: Stablecoins Are Growing Faster Than You Think
While the SECs statement on stablecoins helps clarity one area, it leaves many other types of stablecoins that do not meet the 'covered stablecoin' requirements in a legal gray zone. And just because the SEC says it won’t pursue enforcement doesn’t mean other agencies won’t step in. Additionally, there are ongoing discussions in Congress for the STABLE Act and the GENIUS Act that could result in new federal laws that override or change the current stablecoin guidance.
Outlook
It's positive that the SEC has given a green light to a limited type of payment-orientated stablecoins but the final stablecoin rules aren't settled, and there are still many big unknowns up in the air. It's still a work in progress.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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Waymo Plans to Train AI Using In-Car Camera Footage
Privacy | April 7, 2025
Image: Freepik
Waymo’s In-car Data Plans Echo Orwell's 1984
As featured in TechCrunch, autonomous robotaxi firm Waymo is reportedly preparing to use in-car video data recordings of its identifiable passengers to train AI systems. Apparently, a researcher uncovered a 'draft privacy policy' that raises red flags, suggesting that users would not be directly notified or prompted to opt in. Call it ambient surveillance, or outright overreach but this invisible, continuous breach and approach to privacy is becoming normalized and embedded into business models of modern tech.
See: Ensuring Data Privacy in AI-Driven ID Scanning: Balancing Innovation and Compliance
Waymo clarified later that the feature is still work-in-progress but when companies at the cutting edge of mobility, fintech, and smart infrastructure, treat the public like collateral damage, it's time for people to stand up and push back against being a character right out of George Orwell's 1984 - that's right, Big Brother.
Surveillance Is No Longer Just About Security
Grocery stores are using facial recognition to monitor stores and shoppers behaviour, or how about surveillance and sensors at cashierless stores. Banks are using keystroke tracking to monitor employees.
Surveillance used to be about security but it's evolved into consumer experiences, services design, and product optimization. People now enter physical or digital spaces without even knowing whether their voice, face, movement or even tone is being tracked and analyzed for analytics or AI training. It's a slippery slope and can erode consumer trust, especially if it breaks a core fintech and digital innovation principle based on 'permission'.
Surveillance Free Zones?
These would be places or environments where surveillance monitoring simply isn't allowed or doesn't happen. These zones would offer privacy and a break from that feeling of being watched, studied, analyzed.
See: Major Data Breach @Finastra and Canadian Banks?
To some degree we have these private spaces in our lives today, at our home, or safe space but what if your favourite financial app disabled behavioural tracking by default and that was a differentiator in their business model where privacy, trust, transparency and customer empowerment are core to long term adoption and growth of a product or service.
Consent Needs a Redesign and Value Prop
Surveillance free experiences can built trust and help companies differentiate but the real opportunity is in redefining what it means to people who opt in.
Today the act of opting into an activity is a 'legal gate' where if a user clicks and 'agrees' to move forward then they have allowed it. What about a different model based around value, so if a user provides consent then they actively allow it but in exchange they want something of value in return.
The obvious value exchange is monetary where if someone's data is helping train a commercial AI model then that person's data could generate a tangible return, such as revenue sharing, or some type of platform equity, or a Web3 environment that tracks your data flows and offers tokenized compensation tied to impact and usage.
See: US Financial Surveillance Report Shows Privacy in Crisis
Another value exchange driver could be utility. Where sharing behavioural data leads to a better outcome, such as improved fraud protection, more accurate credit scoring, optimized financial coaching etc. In this way, users see the benefit clearly, and they should have the option to participate or not.
Some users may be motivated by purpose. Canadians for example may show a willingness to share data if it serves the public good, such as improved healthcare models, smarter urban planning, or inclusive innovation.
Any form of consent must put users in the driver's seat and allow them to control their participation. They need to be able to see and understand how their data is going to be used, for how long and in what ways, and have the option to revoke it. Any approach that's going to work in support of long term adoption will need to put participants at the forefront and treat them as humans, not data sources.
Canada Can Lead on Privacy Innovation
Waymo’s plan whether it comes to fruition or not, highlights how easily surveillance can be baked into a future services - literally in a legal and privacy document that most users will not read. Even companies with strong brand trust are drifting towards this world of data collection by default. That's why surveillance, privacy and consent matters.
See: Balancing AI Automation and Ethics in Fintech
Canada seemingly has the tools, policy infrastructure, and appreciation for leading privacy first innovation. There's a growing public awareness and need for privacy updates at the national level per the work being done on the Artificial Intelligence and Data Act. Perhaps regulation will only go so far and businesses will drive the privacy momentum.
Trust is a core input of innovation, and those that prioritize people, not just data, will lead it.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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