> If we are all just taking these coins out of circulation to make them as hard as possible for anyone to access, including ourselves -- then what was the point of the entire thing again?
> But aren't we still pretending that crypto is a currency?
These are such smug comments.
> So this means anytime I actually want to spend some of my own money, I need to go to the bank deposit box and also find at least one friend to help me out?
No, it means you have options to fully secure and own crypto assets in a way dollar bills or bank accounts never allowed. You don't have to do it this way, but if you actually have wealth, you should protect the larger portion of it.
If you have $1000 worth of BTC, just carry it in a hot wallet.
If you have $10000 probably put $9000 in a cold wallet and $1000 in a hot wallet for spending.
If you have $100000, you should probably use 2/3 or 3/5 multisig with a collaborative custody company like unchained capital.
If you have another order of magnitude more money than that you probably know better than myself how to hold your wealth.
In any of these cases, you have full control. Nobody can move your BTC without your sign-off. Your capital cannot be rehypothecated.
So in response to your smug question, yes lock away in deep dark vaults your wealth should you have enough to care about. For daily spending walk around using your hot wallet.
Your comp sci oriented since you're on HN, so if that still doesn't satisfy you, then think of it using caching layers. Keep the bulk of your wealth (should you have enough to justify it) in an L1 deep cold storage, then another smaller chunk in L2 cold storage in a single wallet, and finally L3 in a hot wallet for daily spending.
Another way to view it is if you want anonymity and sovereignty over your dollar bills, you have no choice but to secure it yourself -- probably in a safe.
If you're willing to let someone be a dollar custodian (banker) in today's system, they'll only keep a fractional reserve and lend it out. In actuality today they have other more complicated (but lesser) reserve requirements and without the FDIC bank runs would be commonplace. There's then a whole discussion about the solidity of the FDIC and whether it may collapse.
Fractional reserve systems create the banking cycle and is why we have booms and busts. Ponzi's and fractional reserve systems in crypto are why the crypto market just boomed and busted. There are a small number of legitimate crypto currencies and they're value is tied to the illegitimate ones simply due to crypto-crypto liquidity vs crypto-fiat liquidity.
In this thread nobody is taking a holistic view of what BTC provides.
Even comments that say we're not talking about valuation.
The problem is valuation is part of the reason BTC matters. Sure, you can get custodial security in dollars, but they'll be devalued for banking and governmental purposes.
BTC is sound money that's actually easier to store and use than Gold/Silver. That to me is the way to view it.