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Crypto exchange AAX suspends withdrawals

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Re: Crypto exchange AAX suspends withdrawals

#371

Post by SV_BubbleTime »

ChadNauseam wrote: post #339
boppo1 wrote: post #300

Earlier quoted context omitted.

>There's an entire cottage industry built around people etching their seed phrases on steel plates for people to (I'm not kidding) bury them like they're gold in the 1800s. I was about to say this isn't the worst opsec until I realized you mean people are sending businesses their passphrases and not purchasing an etching kit to make the plate themselves.

Your first instinct was right, they come with little steel squares with individual letters pre-etched, and when you receive them you arrange them yourself into your seed phrase

The venn of arts and crafts, paranoid delusions, and blockchain.

Re: Crypto exchange AAX suspends withdrawals

#372

Post by zeroclip »

Apocryphon wrote: post #336
zeroclip wrote: post #328

Earlier quoted context omitted.

Different category of risk. CEX and DEX can both have hacks. An open source DEX can be verified, formally tested, and made immutable and un-upgradable on chain, like Uniswap. Uniswap V2 contract is 2 years unchanged, $3.8B TVL and $1B daily volume, close to 10 year old Coinbase CEX. Not bad for being a joke.

Those stories about smart contract programming errors leading to money getting permanently frozen are quite scary. Though admittedly in the grand scheme of things they seem to have “only” lost millions of USD, not billions.

Yes, it's a risk. If a contract or protocol is several years old, processing billions per day, and the code is un-upgradeable, you might say the risk is lower.

I'd rather gamble with Uniswap protocol risk than FTX human fraud and greed risk.

Re: Crypto exchange AAX suspends withdrawals

#373

Post by jrm4 »

gjulianm wrote: post #206
disruptalot wrote: post #187

Earlier quoted context omitted.

This was a failure of traditional financial institutions and people who are ok with them, not of crypto. Satoshi wouldn't be encouraging people to put their coins on a trusted third party like that. All fundamental crypto values say this.

Precisely the failure of crypto is thinking that people will follow "fundamental crypto values" and underestimating the power of convenience and ignorance. "Traditional financial institutions" are inevitable in crypto.

I love this observation, because I think it's the perfect wedge point. Will most people fail at this? Yes.

But -- will every single entity that actually does follow "fundamental crypto values" be destroyed? Almost certainly not. That's where the good (and healthy) action is. Follow THAT, everyone.

Re: Crypto exchange AAX suspends withdrawals

#374

Post by irae »

Closi wrote: post #333
xur17 wrote: post #318

Earlier quoted context omitted.

But at least in crypto I have the OPTION of storing it myself. Also, if I do decide to use a custodial provider, I can choose to use a provider that publishes proof of reserves [0], giving me more confidence in the provider. [0] https://www.kraken.com/proof-of-reserves

> But at least in crypto I have the OPTION of storing it myself. You have the option with Fiat too - you can get paper currency and store it yourself in a secure location. $10,000 can be stored in $100 bills in as little as c0.03 meters^3. Using a bank is much more convenient to store Fiat though if you want to buy/sell things, much like using an exchange to store Crypto is much more convenient if you want to trade c…

crypto has a lot of traits of a bank without the bank. Fast transactions (as opposed to carrying money to different locations), secure storage (as compared to having guards for your hoard of gold), it does not rot/burn (if you backup keys adequately) and many others.

All of those are more convenient than storing dollar bills or gold bars. So, yes, fiat has options, crypto is another kind of option and probably the most convenient for self custody, hence a very good one to avoid trusting institutions.

Re: Crypto exchange AAX suspends withdrawals

#375

Post by expazl »

jwitthuhn wrote: post #62
speakfreely wrote: post #32

> Due to the failure of our third-party partner, some users' balance data were found abnormally recorded in our system. Hence, limiting our services to prevent further risks, the technical team has had to manually proofread and restore the system to ensure maximum accuracy of all users’ holdings. "Abnormally recorded" ... "prevent further risks" ... "manually proofread" ... "maximum accuracy". Wow.

That also really stuck out to me. "We're aren't sure customer's recorded balances are accurate and it may be possible for money to simply appear or disappear in our system, but we definitely have enough money to pay out everyone's balance (which as already mentioned is inaccurate)"

My take is more like "We might technically be in debt since our system recorded exchanges of now worthless crypto for other denominations, but we're going to manually go back on those orders and claims its due to system errors."

But lets see how this turns out.

Re: Crypto exchange AAX suspends withdrawals

#376

Post by base »

status200 wrote: post #269
anon291 wrote: post #200

Earlier quoted context omitted.

Unfortunately, absent the crypto exchanges, which let you easily convert crypto to fiat, there is no reason why crypto has any value. Given that bitcoin transaction times are nowhere near VISA or cash times, bitcoin is fairly useless to purchase things in person and few online vendors take bitcoin alone (most use an exchange to convert bitcoin to cash instantly). So without exchanges, there is literally no purpose or…

Having sent $100k via traditional banks as well as crypto, I can add my anecdote that the latter was far easier. Some would argue that it shouldn't be that easy, and I agree to some extent. Setting up our tax system to be transparent and auditable by any citizen would be the greatest benefit to a distributed ledger, but something tells me that the current institutions would heavily resist that transition, so you are…

With online payments I had a different experience. Tried to pay in a store that had coinbase payments with a binance account. So many issues:

- The QR code to pay didn't work with the binance app

- Had to find a way to copy the hash tag of the account from desktop to mobile to pay (luckily if you have a macbook pro and iphone this is easy)

- Initially chose the incorrect network for payments on binance so the transfer didn't go through. Had to read online which network to select.

With a card payment is normally just putting the cards details and in a few cases do an additional authentication.

Re: Crypto exchange AAX suspends withdrawals

#377

Post by bussierem »

timemct wrote: post #172
kkielhofner wrote: post #106

Earlier quoted context omitted.

As I've noted before on HN the entire concept of people being able to manage their own wallets flies against everything we know about people. People forget stuff, make mistakes, and lose things. The margin of error for a wallet is tiny. It's not rare for crypto forums, twitter, etc to prescribe completely ridiculous processes and systems for securing wallets, backing up seed phrases, etc. There's an entire cottage in…

> There's an entire cottage industry built around people etching their seed phrases on steel plates for people to (I'm not kidding) bury them like they're gold in the 1800s. "I write these words in steel, for anything not set in metal cannot be trusted." - The Well of Ascension, by Brandon Sanderson

I know this type of comment (and my own) is more common to reddit and commonly frowned upon in HN threads, but by god this made my morning thank you.

Re: Crypto exchange AAX suspends withdrawals

#378

Post by bornfreddy »

gjulianm wrote: post #283
xtracto wrote: post #258

Earlier quoted context omitted.

I remember when WikiLeaks first decided to accept Bitcoin's for donations. Nakamoto cautioned that Bitcoin was not mature enough fr something like that. I think that the problem with the Cryptocurrencies movement has been that the use peopel want to give to it has surpassed the technological advances that it provides. At some point, the ETH network will get there, providing "trustless" alternatives for a lot of the s…

And at the point that the ETH network provides its alternatives, centralized services will have better products, more users, and more features simply because building centralized services is far, far easier and less time consuming than building decentralized ones.

Well yeah - but they still won't be decentralized.

If that proves to be important in the long run is something that we will see in the future, of course.

Re: Crypto exchange AAX suspends withdrawals

#379

Post by notch656a »

selectodude wrote: post #353
Apocryphon wrote: post #329

Earlier quoted context omitted.

That’s great, and also moot when the vast variety of coin holders opt for the convenience of a centralized third party service instead. With fiat, you also have the option of storing gold yourself.

You can fit $1 million in a briefcase in a safe. No need to rely on fractional reserve banking to store your money. Granted, that would be stupid, but it's certainly an option.

The problem with fiat is a completely unknown monetary supply function. Gold makes a lot more sense IMO in your scenario as there's a finite amount in and on the earth, and it would take a scientific breakthrough to economically create more than that.

Re: Crypto exchange AAX suspends withdrawals

#380

Post by H8crilA »

lbriner wrote: post #7

Forgive my ignorance but it seems that one major problem with crypto-exchanges is that they don't necessarily have any assets other than the crypto that has been deposited there, which means all overheads (which I am assuming for some of these guys is $Ms/year) can only come from trading crypto unless they are charging reasonable money for the privilege of using their exchanges. In the FIAT world, banks make tonnes o…

This part is not actually that much different with respect to banks, where the cushion is the equity (the stock). Also, if I'm not mistaken the debt securities (bonds) issued by the bank are below the bank account claims, so that's your regular customer cushion too.

Bankruptcy is essentially drawing a horizontal line across the pyramid of liabilities, where everyone below the line gets nothing, everyone above the line gets fully paid back, and everyone on the line is the new shareholder. This line is called "fulcrum".

The difference is in government oversight (regulations) and the social agreement that bank accounts will be bailed out. Because of the former the latter rarely happens (yes I know, 2008, but this concept has been around for a century and a significant minority of protected liabilities such as bank accounts have had to be rescued since then world-wide).

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