> Storing your coins on coinbase (or any other exchange) is pretty much always a bad idea. If you don't own the private keys, you don't own the coins.

The problem here for most of the people currently FOMOing in, is that there are no "good ideas" as far as coin storage goes. Storing on shady exchanges is risky, but due to lack of knowledge / technical skill, many/most would also be at risk of losing their coins one way or another if they held the keys themselves.

What this tells us, is that this technology isn't ready for mainstream use.

The technology is there, it's simply a matter of disseminating knowledge.

It's not as if people are born with innate knowledge of personal finance skills. These are skills which must be learnt like anything else.

The really scary (or even shady) part to me isn't a complete outage, but a controlled selective one - where some functions become unavailable to some people. That creates massive opportunities for abuse.

> Insurance companies almost always win, that's how they make money

Not exactly. They make money off pricing their insurance higher than the chances of it happening.

Yes exactly. They make money by a) charging enough in fees to cover the risk and b) limiting the amount they have to pay out.

Just look at how health insurance works: without government regulation, most of the day to day healthcare you actually need isn't covered under the terms of the insurance. For example, contraceptives.

Err, a big chunk of their bottom-line comes from reinvesting the float, or just re-insuring and taking the spread.

To do this you can only make money if the insurance is priced at more than the chance of it happening. Or the reinsurer wouldn't be able to offer any insurance either, & the float wouldn't exist because it would be paid back in claims.

Insurance runs on the same premise of making money a casino does. If there was no casino edge, there would be no cash for the casino 'float' back into bets.

Given a market in a steady state, as long as your (return+premium) rate is higher than your expected payout, you're still ok. So your premium-expected_payout could be negative and you could hopefully still keep the lights on, no?