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by tempestn 4498 days ago
I think people (perhaps rationally) believe that the people running the exchanges know more about keeping bitcoins secure than they themselves do. The analogy would be that you're a lot safer putting your money in a bank than trying to keep it safe in your house. And certainly a company whose entire business is trading in bitcoin should know how to keep them safe. Unfortunately the reality is obviously sometimes different.

Certainly you can keep your own coins essentially 100% safe relatively easily with encryption and backups, but most people wouldn't even think to try, let alone have the necessary knowledge to do so.
1 comments
eropple 4498 days ago
> I think people (perhaps rationally) believe that the people running the exchanges know more about keeping bitcoins secure than they themselves do.

There was nothing rational about this assumption. Banks are bonded and insured with teams of very, very good security professionals auditing their stuff. Mt fricking Gox? Not so much.

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tempestn 4498 days ago
Absolutely, but MtGox probably still knew more about keeping bitcoins secure than most individual owners. The decision to leave it at that and entrust them with large amounts of money wasn't rational, but the belief by many people that they were out of their depth managing the coins themselves was probably correct. (How many coins have been lost in hard drive crashes without backups for instance?) Yes, most people could educate themselves on these things, but most people won't. Nor should everyone have to be educated on everything; that's what civilization is all about. But if you aren't willing to do so, you probably shouldn't be an early adopter, before safeguards are in place.
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talmand 4498 days ago
I see this as more of how local banks were before government guarantees started being implemented. If someone robbed the bank it was your money they were taking and not the bank's. Heck, if the bank burned to the ground your money was gone. Made for a tighter community in some cases; you rob the bank the whole town hunts you down.

What was a bank? Any person off the street with a safe in a building who claimed they could keep your money safe for you until you needed it. Sound familiar?

Personally, I would have put about as much trust into these exchanges as I would have of those old banks.

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eropple 4497 days ago
> Sound familiar?

Yes, and equally stupid, which was my point in the first place. Why did you post?

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