I certainly wouldn't say we are treating it as a "shitcoin". I tweeted out a few thoughts here to share how I think about it:
https://twitter.com/brian_armstrong/status/89248668753155686...
Hope it helps. Thx!
http://blog.kraken.com/post/1150/bitcoin-cash-and-a-critical...
http://blog.kraken.com/post/1183/bitcoin-cash-and-a-critical...
Here's Coinbase's original statement, which seems to be exactly what the grandparent comment was saying: https://twitter.com/coinbase/status/890986442674941953
"Coinbase does not intend to interact with the Bitcoin Cash blockchain."
It simply says, not supporting BCC now, but might in the future -- we will not acquire the BCCs for Coinbase.
"Wait and see" is usually a reasonable stance for companies to take, but in the case of securities splitting in two, withholding the new securities until their value changes - potentially even keeping them yourself - really shows your hand.
Among other things, this split has thrown into relief the stances various exchanges take with regard to their clients, and anyone researching which exchange to use should take a good hard look at moves like this when considering who to invest with.
It's just strange that Coinbase either wasn't prepared or sees BCH as a threat. Balkanization of bitcoin is unnecessary. Why refuse to support what everyone else supports? https://twitter.com/Yelka_Pineda/status/891020902066003968
There are political elements, for sure, but the overall reason for it is there are a genuine segment of people who believe segwit is kludge, and on chain scaling is the way forward.
Whether or not those people are correct, this chain represents their version of the bitcoin vision, dismissing it as a political move is a tad arrogant.
Helping the split in any way (e.g. by making the split easier to use or by acknowledging it as a reasonable alternative) means facilitating future splits and future balkanization, driving down long term value of BTC.
I agree with this point, and I see Coinbase's comm as trust-building with their (perhaps nonvocal majority?) customers.
The future of this technology cannot work if you must understand the jargon and consequences of a fork (and whatever else can happen), and then form an opinion of your exchanges as a mainstream adopter based upon how they deal with these intricacies. Most people just want something easy to use. Coinbase has allowed that happy path to continue, and I trust them as a result of the manner in which they handled this event.
(Now, for people in-the-know, things are different. But I'd bet that Coinbase's target audience is not blockchain hackers.)
It perhaps makes sense from a business standpoint: why support a new coin from day 1 instead of waiting for the ecosystem to mature? Coinbase already doesn't support other coins like XRP or Monero or whatnot.
Will Coinbase keep BCC coins for itself?
No. Coinbase does not intend to support or interact with the new blockchain in any way. If this were to change, Coinbase would make those coins available for customers to withdraw, not keep them.
Ironically, not "interacting" with that chain only serves to create more dead coins and thus push up value. Imagine if the value grows considerably... customers might be changing their tune if they feel that they lost out and feel they were misinformed.
The email laid out the process if you want access to the fork.
Downtime should be unacceptable and exceptional for a financial marketplace.
On Coinbase however, downtimes and unexpected behavior are common place, and happen multiple times a week.
It's outright fraudulent when you allow your employees to trade during those downtimes.
What the hell.
Many that left their BTC assets on CB in interest of your core benefits - simplicity, security - will watch with interest for further communication in the coming weeks as price of bt cash stabilizes.
I imagine most of the exchanges that didn't support BCH are going to lose a lot of customers over it.
I didn't know much about the fork up until a few days ago, but I did know to make sure I unloaded everything off of Coinbase if I wanted to benefit and double my tiny little bit of BTC since there had been a notice for weeks now about how they won't support it and a cursory Google search showed what you needed to benefit.
1) I'm a long time miner who owns a massive wealth of Bitcoins.
2) I fund some developers to create a hardfork.
3) I dedicate a small percentage of my mining power to prop up the new coin.
4) Coinbase adds support for the new coin.
5) I deposit all my new split coins at Coinbase, trade for BTC, and withdraw BTC.
6) Using the rest of my mining power I then reverse the depositing transactions to Coinbase by double spending.
7) Profit.
I think it's positively absurd that _any_ exchange is supporting BCH.
But to each their own peril.
Coinbase and others saying they'll "wait and see" is really just another bump on a long road of screwing users out of funds. They once again profit off of later price information - and in this case can even decide to argue that they held the assets and so own the BCH - essentially just earning another piece of their users' pies.
I'm amazed people still stick with Coinbase. Any exchange that even nominally 'puts users first' (i.e. isn't trying to screw them for profit) has offered withdrawal of BCH from the get-go. Though OTOH anyone who has seen how Coinbase operates with price fluctuations and so on would have guessed they'd end up doing this for the fork.
Pick your partners wisely folks. :)
It's just very unlikely this could work. Possible, but very unlikely.
Edit: Also, if you have a very large amount of coins, you probably want to sell it off slowly, instead of tanking the market in one go. This makes it even more difficult since if you're caught reversing the first few transactions, your account will be flagged.
If you have >51% of the mining power, you can overpower the rest of the network. Simply pick a block in the past and start mining from there, ignoring everyone else. With >51% of the hashrate you _will_ overcome the rest of the network and enforce your new chain.
They can do it in secret. Build a secret parallel chain while they transact, then release the chain after they've got their BTC.
And 51% is not "insane". It's absolutely tiny. As I said, _any_ of the large pools could do it, right now.
How can you have more than one pool, each with more than half the power?
EDIT: OK I see where you're coming from I think... you mean any of the pools could 51% the forked branch, right?
Imagine a new sport called zoccer. It's just like regular soccer, but if a team scores 5 goals within the 90 minutes, they automatically win the match.
Right now there are only a few small teams playing. But Nike has said they are willing to sponsor a tournament, if there is enough interest.
At any point, Barcelona or Manchester United or Real Madrid or Chelsea or AC Milan or any other large soccer team team can just say "we are now a zoccer club" and swoop in take Nike's money.
They all have the power to switch and dominate the new scene.
You don't need to mine 6 blocks in a row against the other miners, you just need to have a longer chain. So you simply fork the chain, and then submit that as the "real" chain.
With 60% of the mining power and a 6 block deficit, you'd overtake the main chain in 120 minutes (approx; 12 blocks), since you're making up half a block of deficit per block they mine.
If you really had 60% of the mining power, you could undo 3 days of transactions in about a week of mining.
Exchanges can quite easily protect themselves.
All they have to do is increase the confirmation time before they "accept" coins.
The longer you wait, the more secure your coins are. I would suspect that a day is easily enough time to be confident that a double spend won't happen.
Sure, you can build a longer blockchain, but nothing forces other people to accept that blockchain.
IE, people can checkpoint the chain.
Also, if 51% attacks consistently started to happen, that would cause the price if that chain to plummet to 0.
There is no point stealing money that is worth 0.
Not really cool to be ambiguous about stealing $2000+ from your users.
don't keep your bitcoin in exchanges. it defeats three of the main appeals of bitcoin: autonomy, trustlessness, anonymity
Bitcoin itself isn't anonymous at all: All transactions are public. Only via a Laundry you can cover up your tracks.
Zerocoin and Zcash were created to fix that.
The laundry scheme isn't tied to Bitcoin, that's why I think it's wrong to say that one of Bitcoins advantages is anonimity.
So make a new key, and tumble the Bitcoins until you feel safe again.
EDIT https://news.ycombinator.com/item?id=14918545 This just started getting popular if you want to talk more about tumbling.
Serious question: under what legal theory (not loose analogy) is the BCH corresponding to a wallet held by Coinbase property of Coinbase's users and not Coinbase?
That's hardly specific.
> Stuff like this happens all the times in spinoffs
There's a reason I specifically excluded loose analogies.
> the rules are very clear about who is entitled to the proceeds.
And the specific rules that specifically apply to a fork of a cryptocurrnecy and a firm providing wallet services like Coinbase are...what, precisely?
Perhaps general securities laws are written in a way which encompasses this scenario, but I'm asking about the specific applicable laws that cover the situation at hand.
It's more akin to a forex brokerage deciding not to support EUR when it first came out over the lira. You can easily use someone else, Coinbase is hardly the only service around.
Under these circumstances, you'd have serious reservations about passively parking any assets with that particular broker...
Which analogy is the best one depends on your point of view on this debate.
No obligation would exist, but I'd rather take my business to a broker who would do so, given the choice.
Furthermore: It is possible to directly transfer stocks from one brokerage account (similar to a wallet) to another at a different brokerage without having to liquidate assets.
Your "forex brokerage" then decides they're "not going to mess with this newfangled currency", leaving you none the wiser with how they're handling the newly created funds if at all.
If it goes up, they could shrug and say that they had the serial numbers so it was theirs the whole time. If it crashes, they could credit everyone the decreased value of the lira out of money they made by selling off earlier and pocket the rest. (Or take option A and pocket all of it, if the 'good' PR is not worth the slightly decreased profits.)
Considering the prices people end up having gotten "locked-in" on after price fluctuations when using Coinbase, this wouldn't even be "far-fetched" for them so much as par for the course.
Which, if you aren't familiar with what the word "fork" means in the developer world, was exactly what I wanted to hear from a legitimate company like Coinbase.
And BCC will start at 0.01 BTC.
To me you don't need to be a developer to understand that.
Any other easily-googlable questions? :)"
It's not unreasonable to expect some delays accessing their cold storage (which is key split across geographically disparate safe deposit boxes, last I heard)
That said, I was around during Mt. Gox's failure (fortunately didn't lose anything then) so I get a little skittish when I hear about a wallet/exchange experiencing withdrawal delays...
First of all, I've always trusted Coinbase a lot more than most other Bitcoin services. They're a US company, a YC company, I've met the founders, I know some of the employees, they at least appear to be very serious about security, etc.
Second, those 80 BTC are not all of my Bitcoin. I don't completely trust myself to securely store Bitcoin, so I like having some diversification of risk.
But yes, some of it comes down to laziness. I should probably figure out a better way diversify the risk without needing to trust a 3rd party.
You'd argue it's better for me to have wait until the price stabilizes at 2% of BTC before I'm allowed to cash out?
Imagine a bank anouncing they would keep all the dividends of one particular stock, because the didn't like it. That's what coinbase is doing. It plain and simply theft.
Is it your property? It's a benefit that people have decided to extend to whoever controls existing Bitcoin wallets. Do you have an agreement with Coinbase that obligated them to transfer to you any such benefit that should accrue to the Bitcoin wallet they control for you?
1) At last not legaly binding, that had to be there at the very least in red flashing letters, possibly even then it would have been void.
In the absence of any specific agreements with Coinbase regarding usufruct rights, you wouldn't have them (just as you don't have usufruct rights when depositing currency in a bank account) - you don't own that BTC, Coinbase owes you some fixed amount of BTC, and that's that.
Of course, that would be a nice thing to test in courts - after all they decide who owes what to whom, not the algorithms of BTC/BCC.
Right, that's governed by your contract with Coinbase, and is the service they offer.
> Now every btc owner gets bcc.
No, everyone controlling a BTC wallet is now also controlling a BCC (or BCH, I've seen both used as the abbreviation) wallet with an equal number of coins.
I'm guessing rights to coins on alternative chains that Coinbase ends up controlling due to BTC forks are not covered in your contract with Coinbase.
There is a difference between ownership and possion. Technically (in the meaning "how it is realized in computer code") bcc is given to the person possessing btc. But by the law the owner is entitled to the profits of a thing. But coinbase does not own my coins, it merely posses them.
Yes, ownership is a matter of law. By what law does the act of a fork which grants possession of BCH to controllers of BTC wallets grant ownership to anyone else?
> But by the law the owner is entitled to the profits of a thing
That's, at best, imprecise. I own money, which I hold on a bank, which contracts a certain rate of interest (which may be zero) to be paid on it while I hold it there. I absolutely do not own any profits the bank is able to realize through holding the money (any more than, beyond those contracted, I am liable for any costs associated with their holding of money); indeed, their ownership of the net profits realizable by having the money in their hands is central to their business model. (There are restrictions on their ability to use the money they are holding to prevent undue risk of them not being able to pay my money back, but if they gain a windfall, I don't share in it.)
The real question seems to be legally whether BCH is a gift to those owning BTC or those possessing it. In the absence of very strong evidence to the contrary, I think the law is likely to say that who possession was given to also determines who ownership was given to. If I give a thousand dollars cash to everyone I see wearing a green hat, and one of those people had borrowed the hat, the owner of the hat is going to have a difficult time arguing that they own the thousand dollars.
Bch is not a gift. Who should have gifted it? Who is the previous owner? How did the previous owner aquire it? It is a "fructus" of btc. And that belongs to the owner.
This right can be signed away, with life estate or usufructus. But that's a big deal. That can't be somewho implied in a sentence hidden somewhere in a long ToS.
> Coinbase securely stores all Digital Currency private keys in our control in a combination of online and offline storage.
And if you read the whole thing,
> supported Digital Currency
is mentioned multiple times.
[1] https://www.coinbase.com/legal/user_agreement?locale=en-US#1....
That's wrong, and obviously so. That concept is "possession" and not "ownership".
What they write in their ToS doesn't matter, it does not change fundamentals of porperty law. (Well, as every legal argument on the internet it depends on your jurisdiction and the jurisdiction of the coinbase, as coinbase resides in multiple)
Not sure what happened on this month's job thread (too late to delete?); it's not like it's a secret!
https://news.ycombinator.com/item?id=14902743 vs. https://www.coinbase.com/careers/477665
King_mansur 17 hours ago
[flagged]
AvenueIngres 17 hours ago
>* Our APIs are currently powered by Rails with a MongoDB backend
Everything makes so much sense now (Coinbase's single digit SLA)
--
In case you are wondering what technologies we use at Coinbase, we’re built using a combination
of Ruby, Node.js, PostgreSQL, MongoDB, Redis, Swift (for iOS), and Java (for Android).> when Ethereum split "Coinbase eventually let customers withdraw their share of the new currency, known as "Ethereum Classic," even though it still does not allow it to be bought and sold on the Coinbase site.
Note the ETC withdrawal option came after ETC spiked in price and retreated like 80%. Coinbase then ended ETC withdrawals at the end of 2016. I suspect you'll see the same with BCH.
Pretending like you're "staying out of it" works 9 times out of 10 for businesses, but in this case it's pretty transparent that they're banking on the ignorance/apathy of users who decide to leave their funds with CB despite warnings so that CB can trade or even pocket the BCH and profit off of deciding based on future price information.
I wouldn't be surprised to see them cross the line into out-and-out fraud someday. Until then, I'd keep my money somewhere else.
My biggest issue with Coinbase is that they claim insured wallets, but actually only insure the 2% of bitcoins stored in their hot wallets. Cold storage is uninsured. If their cold storage gets lost/stolen/hacked, all holders are going to lose 98% of bitcoins. That's not insurance.
Which was essentially they are treating the new Bitcoin cash as a shitcoin, aka not supporting it.
They took the position that if you want your "free" Bitcoin Cash, move your BTC out of Coinbase.(1)
This led to the inevitable service decay & delays that CoinBase has become well known for in the bitcoin community whenever leading up to a high volume event. (2)
And yet their internal PR team has given somewhat measured responses that "if Coinbase decides to support Bitcoin Cash in the future, it will distribute the balances that accrue at the time of the August 1 fork." (3)
The article w/that nugget goes on to state that when Ethereum split "Coinbase eventually let customers withdraw their share of the new currency, known as "Ethereum Classic," even though it still does not allow it to be bought and sold on the Coinbase site."
Seems like a risky bet not to just say something closer to "Hey if Bitcoin Cash is a thing and worth more than 1% of the original BTC we'll support it. If it's not at the end of 90 days we'll give you a way to take it out either way."
Judging by the volume of concern and disdain from newbies in the Bitcoin forums a lot of people got woken up by this event and what it means to have your decentralized currency controlled by a central authority.
(1) https://blog.coinbase.com/update-for-customers-with-bitcoin-...
(2) http://bitcoinist.com/mass-exodus-from-coinbase-spawns-12hou...
(3) http://fortune.com/2017/07/31/bitcoin-fork-coinbase/