I don't get the point of this comment. Are you criticizing the current state of cryptocurrencies, or are you implying that investing your life savings in an exchange is somehow safer than keeping it on a USB key?
I'm not entirely convinced it isn't for some people. USBs can break, keys can be lost. Exchanges can be insured and put a lot more time and energy into keeping things secure.
There have definitely been a few tremendous failures, but there's an argument for keeping it in a trustworthy big exchange, if such a thing exists. Same reason banks hold money - you don't want your house burning down or burglary to pose a problem. If someone stumbles upon your recovery keys it's game over.
As someone who just had funds removed from their bank account via a skimmed debit card, I trust my bitcoin savings infinitely more than my dollar savings.
To protect myself from fire or flood, I have one of these: https://cryptosteel.com/ in a safe deposit box.
Hardware wallet sits in my desk and is protected by a pin.
Both the 24 security words and hardware wallet are protected by a password.
I can use a different password to access different wallets.
I can back up my account balance by simply saving a copy of the blockchain.
If your debit card was in a safe deposit box, it would have been just as safe.
And yeah, cryptosteel. What's the difference between that and a post-it? It seems like pretty much a really small movable type. Their site reads like a Franklin Mint commercial.
If bitcoin becomes currency like you hope, you're going to run into the same problems, security versus convenience.
> If your debit card was in a safe deposit box, it would have been just as safe.
Um, no. When I spend bitcoin, I'm not exposing myself to the risk of someone having complete access to my account. When I use a debit card I am. Huge difference.
> What's the difference between that and a post-it?
Post it notes burn. Also, cryptosteel is only for the security words. It still won't give access to my wallet's private key.
> If bitcoin becomes currency like you hope, you're going to run into the same problems, security versus convenience
First, it already is a currency. Second, the security model of bitcoin is infinitely better than that of a bank.
And if it doesn't give access to your wallet, how does it protect your wallet? If it can be used to gain access to your wallet, then how is writing it down safe?
Of course there is - archival quality printout of a paper (on archival acidfree paper) wallet stored in a bank safe.
That's safe. Convenience depends on how often you need it (and so there's not one standard of convenience you can quantify without being the actual person who's using it.)
The recommended place to store bitcoins, the currency which promises freedom from the corrupt banking system, are banks?
> That's safe.
It is quite safe, but still not as safe (World Trade Center, Hurricane Katrina, ...) as your money in an account with insurance. And much more inconvenient.
You can split a bitcoin key up using Shamir's Secret Sharing Scheme (or just multisig) and store the key geographically-distributed such that if any one location is destroyed you don't lose the money, and if any one location is stolen the thief doesn't get the money.
You can also replace "one" with an arbitrarily-large number, depending on how many locations you want to store the money in.
Now compare this to online banking and seriously tell me that this is easier. Yes, you can set up a system that is very resistant to failure. But my grandma doesn't understand the difference between minimizing a window and deleting her facebook account. I'm not excited about explaining SSS to her.
> Now compare this to online banking and seriously tell me that this is easier.
It's not. But compared to storing large amounts of dollars, pounds, or euros, it is easier.
> Yes, you can set up a system that is very resistant to failure. But my grandma doesn't understand the difference between minimizing a window and deleting her facebook account. I'm not excited about explaining SSS to her.
Your grandma won't need to know about any of that, because she'll probably continue to trust an organisation to look after her money for her.
Just because cryptocurrencies make it feasible for people to not trust other entities with their money doesn't mean that everyone will.
I'm not entirely convinced it isn't for some people. USBs can break, keys can be lost. Exchanges can be insured and put a lot more time and energy into keeping things secure.
There have definitely been a few tremendous failures, but there's an argument for keeping it in a trustworthy big exchange, if such a thing exists. Same reason banks hold money - you don't want your house burning down or burglary to pose a problem. If someone stumbles upon your recovery keys it's game over.