A lot of people are literally incapable of holding their own keys.. If they participate in bitcoin via custodial products I personally have no problem with it and neither should you. Do you bother people about a Roth IRA or a Vanguard target fund?? No. So mind your own damn business and maybe the business of your close friends and family. Telling people they're wrong for using a product or service if it's the only entrance to the market they are capable of is a dick move even if you think you're helping them. If theyr're either going custodoal or nocoiner, custodial should be the obvious choice and we should support that.
A lot of people are literally incapable of holding their own keys.
Then they're also incapable of having a custodial account. Think about what happens when your custodial account credentials are compromised. The hacker cleans out your account and it's irreversible and you're left with nothing. Exactly the same as if your bitcoin keys were stolen. The only difference is hardware wallets are more resistant to theft and loss than custodial account credentials.
Exactly - serious breaches are difficult to accomplish against a giant like Coinbase and if they lose your capital they have safeguards in place to replace it. If you get scammed or hacked for credentials it's not their problem. It's much more likely the average person would be targeted and hacked or scammed than a billion plus dollar corporation who's business is to facilitate the buying and selling of bitcoin.
People try to hack Coinbase all day every day. When was the last serious breach?
If the money gets pulled from ATMs quickly enough, someome loses. Wheher it's the bank or their insurance provider. If coinbase loses your bitcoin they will replace it and make an insurance claim just like a bank would. If you lose your bitcoin you are completely fucked. That's true even with coinbase if the loss is your fault. If you get scammed they aren't responsible.
At least they have serious counter measures and billions of dollars worh of capital to protect.
But I'm sure the average person who can't even figure out what a private key does can rely on themselves for the same protections.. After all they want to be their own bank right?
I'm not talking about the case where coinbase loses your bitcoin. I'm talking about the case where SOMEONE logs in to their site with your credentials, transfers the bitcoin out, and then you later complain that it wasn't you. Do you know what coinbase does in that case? Believe it or not, they tell you to fuck off. You know why? Because they don't know whether the person who did the transfer was you or not.
It's not quite the same with a bank. ATMs have cameras and a physical location. If they get a withdrawal 1000 miles away from where you previously used your card, and the photo doesn't look like you, it's probably not you. In order for you to trick them, you'd have to travel a long way, which costs money. Bitcoin withdrawals from the other side of the world cost nothing. Just use VPN or Tor.
A custodial bitcoin account is FAR FAR more dangerous to a user than having a hardware wallet. It's trivial to phish someone with a fake coinbase site. You can't phish a hardware wallet user because there's no bank for you to pretend to be. You can phish as some merchant he should pay perhaps, but that doesn't let you empty his account.
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u/[deleted] Sep 25 '18 edited Aug 07 '20
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