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Coinbase Wants Wall Street to Resolve Its Bitcoin Trust Issues

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Re: Coinbase Wants Wall Street to Resolve Its Bitcoin Trust Issues

#91

Post by sova »

shroom wrote: post #82

This may be a stupid question but I dont understand every aspect of bitcoin so bear with me. Is Bitcoin access coupled with one private key or multiple? Say someone has 10 bitcoin on their computer and a private key so its only accessible from that computer. That computer holds a lot of value. If the computer gets stolen theyve stolen all the bitcoins with it? Given that the secret to the private key can be broken at…

Please, ask away, it's easier to clear up things when you have access to the experts, like on HN. If you purchase Bitcoin through an exchange, typically you don't have the private key, you just trust the exchange to do all the nitty gritty for you.

If you generate a new address with a wallet software, it'll have a private key (that is much longer than the deliveryAddress.length) and you can move your funds from an exchange to this address (whereupon you'll have complete control).

If you lose the private key it's [basically] impossible to recover with brute force, which is the point. If someone takes the physical hard disk from you and you have no backup of the info, yes, it's gone.

If you somehow have your info stolen, but still remember it (via air-gapped pc text file or something) you can move the funds before they get swiped. Again, use wallet software to generate a new address with a new private key and repeat.

So either you have a really good way to store your private addresses so you can still use your coins in the future, or you trust an exchange to hold the coins and you don't play in that realm at all. Those are the most popular options currently.

Re: Coinbase Wants Wall Street to Resolve Its Bitcoin Trust Issues

#92

Post by shroom »

diego wrote: post #86
shroom wrote: post #82

This may be a stupid question but I dont understand every aspect of bitcoin so bear with me. Is Bitcoin access coupled with one private key or multiple? Say someone has 10 bitcoin on their computer and a private key so its only accessible from that computer. That computer holds a lot of value. If the computer gets stolen theyve stolen all the bitcoins with it? Given that the secret to the private key can be broken at…

You don't want to store your private key unencrypted on a computer ever. If someone gets a hold of a private key, they control all the bitcoin under that address. However they acquire the private key doesn't matter.

Thanks! Reason Im asking is first ive Never traded btc and second I have friends who started and I can imagine they know anything about crypto, private keys, secrets etc. I might need to point this out to them if they continue with this.

Re: Coinbase Wants Wall Street to Resolve Its Bitcoin Trust Issues

#93

Post by FabHK »

nostrademons wrote: post #74
blhack wrote: post #46

Earlier quoted context omitted.

What about this is WTF? Please explain, in detail, how somebody with $10M in BTC should store it.

I think the WTF is that the original point of cryptocurrency was that it was supposed to be decentralized , with no big institutions that you must trust. Coinbase Custody is essentially reinventing the exact institutions that bitcoin was supposed to cut out of the loop. You're supposed to store $10M in BTC on the blockchain, which - after all - records ownership of every bitcoin ever mined. And keep access to it in a…

Very well put. It is sort of funny, isn't it.

Bitcoin maximalist: "Bitcoin, no need to trust evil centralised institutions!"

Actual Bitcoin users: "Oh, hey, could you take care of my Bitcoin balance for me, please? And you have password recovery, right?"

Re: Coinbase Wants Wall Street to Resolve Its Bitcoin Trust Issues

#94

Post by carc »

H99189 wrote: post #8

Coinbase should solve it's coinbase trust issue. I bought a small amount of litecoin almost 2 weeks ago, i'm well past my "delivery by" date, my funds left my bank account over 10 days ago, yet I still don't have my coins in my account.

To counter anecdote with anecdote, I've had no issues with coinbase and have found them pleasant to use. That includes transferring to gdax/selling/withdrawing, etc.

Re: Coinbase Wants Wall Street to Resolve Its Bitcoin Trust Issues

#95

Post by temp987654 »

H99189 wrote: post #8

Coinbase should solve it's coinbase trust issue. I bought a small amount of litecoin almost 2 weeks ago, i'm well past my "delivery by" date, my funds left my bank account over 10 days ago, yet I still don't have my coins in my account.

I had a Coinbase account for a year or so. Switched to Bitstamp and couldn't be happier.

Re: Coinbase Wants Wall Street to Resolve Its Bitcoin Trust Issues

#96

Post by meritt »

empath75 wrote: post #37

Until the situation with bitfinex pumping billions of unbacked tether into the ecosystem is resolved, doing anything involving bitcoin right now is insane. They’ve released almost $200 million worth of tether in the last day .

My theory on tether is their goal is to absorb as much downward (selling) pressure as possible on the BTC/USD market and encourage only upward movement of BTC (equally applies to any other crypto)

1) Someone who wants to sell $1M USD of BTC may be happy to take $1M USDT instead for legal/tax purposes. This transaction would have zero impact on the BTC/USD price.

2) Tether receives $1M worth of BTC they can slowly disperse back into the market via their own exchange (since Bitfinex owns Tether) in a controlled manner that doesn't push the price down.

3) With USD in hand they can either put it into their reserves (assuming we trust them) or they could also use the cash to further eliminate any selling pressure on the exchange (with a large buy order "wall") or even generate upward pressure.

4) BTC price becomes stable or only moves upward and attracts more outside money and speculation. Repeat the cycle.

Re: Coinbase Wants Wall Street to Resolve Its Bitcoin Trust Issues

#97

Post by smokeyj »

colemannugent wrote: post #90
shroom wrote: post #82

This may be a stupid question but I dont understand every aspect of bitcoin so bear with me. Is Bitcoin access coupled with one private key or multiple? Say someone has 10 bitcoin on their computer and a private key so its only accessible from that computer. That computer holds a lot of value. If the computer gets stolen theyve stolen all the bitcoins with it? Given that the secret to the private key can be broken at…

The private key is the secret. Someone who steals it does not have to break anything. In this case it is similar to a physical lock on a safe: if you lose the key to the safe you just have to accept that you no longer can access the contents of the safe. You can have wallets that are protected by multiple keys, but there is not a whole lot of wallet software that does this in an easy to use way right now.

https://copay.io/

An open source wallet by bitpay with good support for multi-sig transactions.

Re: Coinbase Wants Wall Street to Resolve Its Bitcoin Trust Issues

#98

Post by Retric »

solatic wrote: post #83
chollida1 wrote: post #2

EDIT Yuck, this blew up and I think alot of people took it the wrong way. I think Coinbase is great, and I'm sure everyone who works there is awesome and terrific at their job. Anyone who has worked on any half way successful project knows just how hard both uptime and security are and I'm in no way upset at Coinbase for having growth issues. I've done this for years and might not even get an interview with them. The…

These comments strike me as very much against the ethos of cryptocurrencies, which is to say, using a publicly available ledger with access governed by rules democratically set by the majority of nodes instead of many secret private ledgers governed by civil institutions. Counterparty risk? What counterparty risk? The minute the funds leave your wallet governed by your private keys then you no longer have control. Th…

If I buy coins using a 3rd party service and they have yet to transfer them to my private wallet then I have counter party risk until they do.

All exchanges do this to one extent or another. To minimize risks they would need to accept cash and never accept bitcoins to their own wallet which would cause massive transaction fees.

Re: Coinbase Wants Wall Street to Resolve Its Bitcoin Trust Issues

#99

Post by temp987654 »

artur_makly wrote: post #71

their ID system had not worked for MONTHs. https://status.coinbase.com/ i cant buy or sell while traveling outside the USA.

Why do you use the worst service available? There are way better players in this market than Coinbase imo.

Re: Coinbase Wants Wall Street to Resolve Its Bitcoin Trust Issues

#100

Post by s_dev »

H99189 wrote: post #8

Coinbase should solve it's coinbase trust issue. I bought a small amount of litecoin almost 2 weeks ago, i'm well past my "delivery by" date, my funds left my bank account over 10 days ago, yet I still don't have my coins in my account.

After I read on Hacker News by a number of commenters that Coinbase Customer Support had given up -- seemed fairly dodgy to give them money as you've no reason to think you'll get recourse should something go wrong.

I went with BitPanda. I should leave my referral link here but rather my own words carry the recommendation.

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