Is your money safe?
Hey Steemit Friends,
The security of crypto assets concerns me and I think the overall sentiment is fairly negative in the global opinion. When older people ask you is your money safe? How is it secure? Can't hackers just take it? How do you actually answer it? Even in discussion with a fellow crypto fanatic how do you answer it correctly?
Common answers seem to be:
(a) Move them off the exchange to a wallet
(b) Enrypt/develop seed/good password
(c) Copy down private key and store safely
(d) Optional - Paper wallets
(e) Optional - Store on computer not connected to the internet
This is standard practice and for some reason everybody seems to be OK with this? Let me tell you, when I buy shares through a stock broker, I don't take the digital footprint for these shares to my personal 'share wallet' and then encrypt it and write down a private key to store in a binder under my desk... No, I trust that when I buy shares, they are safe in my account and assuming the company is still there 15 years later, these shares will still be there too.
As we saw today, apparently not even the wallets are 100% safe ($32 Million Stolen). Those people did everything right and still got burned. Doesn't anybody think that it's a bit of a cop-out that you can have accounts on these exchanges, but if you're in for the long term it's better to use cold storage.
On top of this we constantly see stories of people whose money and crypto is in limbo for weeks at a time while the exchanges try to get their shit together (Poloniex cough cough). This will not create confidence in the eye of the general public.
If I buy crypto assets I would like to think that I don't need to worry about a rouge hack or an exchange scamming off with everything in the future. Is exchange and wallet regulation something that may need to be brought in? Is insurance on the cards for exchanges, so they can pay out users in the event where funds are lost?
I really want your average Joe investor to consider crypto as an asset in their portfolio but I don't see how that can happen in this climate. I want worldwide adoption of cryptocurrencies, but first there does need to be security improvements.
Now I am not a firm believer in do not buy and store cryptocurrencies. I personally own a lot of cryptocurrencies. I am just worried about the future.
Well ! you could start by following me!
I found out about Steemit through you and I upvote your blogs whenever I see them.
Honestly, I feel like this has been a one way relationship.
@proximity
Awesome good luck! @proximity
Very good points, I think this is a fear on most investors minds when discussing Cryptos.
The chance of a hack causing total loss with no insurance, eventually will become a thing of the past. As the industry moves forwards I believe these types of scenarios will turn into business opportunities for blockchain enthusiasts.
At the end of your post there you mentioned for example a wallet that is insured. Paypal offers payment protection and it was a key factor in their earlier adoption in leading to a more serious followship that felt safe with Paypal. So there is a profitable model there if someone wants to code it and implement it. There is no reason we cant have fraud protection on the blockchain just it does need authority bodies which can investigate just like a bank / credit facility does.
Online money is nothing new. Digital money has been going since the telegram, is that not even more risky then BTC?
When I was a young man people used to steal cheques from the post boxes in England and forge them. Later on when tesco first went online every single credit card was stolen. The bank played catch up for weeks. There have been hacks after hacks on the current trusted long standing financial systems and no one is worried.
How did people know their money is safe in their hedge fund when Bernie Madoff done them all?? That was all using secure trusted practices was it not?
What about the 4 Barclays managers on trial currently for fraud. Or the countless MP Scandals in the UK. If this where on the blockchain atleast we'd have some form of record. some accountability. not a black box.
Fraud happens on any level it can because Thief's are ingenious. I believe cryptos would highly benefit from a consortium or regulator which was pro-active. As cryptos turn banking on its head by having deflationary currencies, the regulation should also be turned upside down. Instead of lagging, waiting for reports of issues. The regulation in crypto should be proactive. Looking for fraud, looking for hackers and continually working as community to ensure a robust and reliable experience for decades to come.