Apps that ask for accessing your contacts should be viewed with a very critical eye. To illustrate this, let me tell you a story.
Sue and Joe are good friends since their days at college. However, Joe recently got into conspiracy theories and even joined a network of conspiracy theorists. They use an app to chat with each other. This app accesses the contacts of the user and stores all of them on their servers. So Sue’s contact data is stored on this server too. The reason? Obviously to match and let users find out who is on the platform. That’s a common practise for almost all chat apps.
But suddenly things turn ugly: on the platform, people become more and more radical and call for violence against others. Some are even threatening to kill people with different opinions. Now things look very different: Sue’s contact information is on this server and it turns out their servers have sloppy security. Eventually, data from the server with Sue’s contact information is leaked to the public and Sue finds herself in bad company.
This is of course a fictional example to show how your personal data (name, email, phone, address, profile picture) can end up in a shady place.
Currently, it’s not possible to prevent apps sharing your contact data without your knowledge. Sue had no way of knowing that Joe’s app was sharing all his contact data including hers. But there might be a way in the future. Since Apple and Google control your smartphone access to the contact data could be made privacy sensitive. Every contact can contain info if it’s ok to be shared or not with a default of “no”. Granted, this requires considerable efforts of Google and Apple to work together to make this available for app developers. The technology is available to share encrypted data and to work with it. For example, Mircosoft uses a tool to inform you that your email was part of a leak. They use homomorphic encryption to keep your data private.
Will such a thing happen? Truth be told, I’m not overly optimistic. The chance is not zero, but not much bigger than that.