I've also heard stories where people were locked out of exchanges during crashes, preventing liquidation, because exchanges stopped or delayed deposits during high volume trading.
Its super cool that you can keep your own crypto, but if you can't trade that crypto, whats the point?
Your parents will never have a custodial wallet. The fact that traditional banking is easier than 'doing crypto right' should give you all the adoption metrics you need.
Don't do that if you want to actually own your coins.
No, it is you who missed the point yet again. If you give your crypto to Coinbase it isn't your crypto anymore. You are entrusting Coinbase with your crypto. FDIC insurance may be helpful if your bank has financial difficulties, but any money you entrust to the bank can be seized just as easily as Coinbase can seize your money. Ask a truck driver who participated in the lockdown protests in Ottowa how secure their fiat money was in the bank after it was unilaterally seized by the government.
> The fact that traditional banking is easier than 'doing crypto right' should give you all the adoption metrics you need.
Does anyone go into crypto because it is "easier" than traditional banking?
Even if you have a private wallet, you don't 'own' your own crypto.
When the Solana network was down [0], could the people that 'own' their own wallets trade their crypto? What about the people with their coins on an exchange?
A recent example is Solana. Their network keeps crashing [0]. Everyone keeping their own keys are completely locked away from trading their coin. Everyone with their coin owned in a centralized exchange can trade freely.
If you hold your own coins, you're vulnerable to network attacks and AMM instability/hacks.
If you put the coins on an exchange, you're vulnerable to the exchange's liquidity issues.
How much downtime did Terra have before it crashed?
Bitcoin you can hold it, transfer it, and not much more. Having smart contracts (like Ethereum) allows you to have something like Uniswap, which is decentralized and allows you to trade your coins.
Yes, it's not a fiat on/offramp, but if stablecoins are actually good and backed, in the scenarios you describe you would just buy/sell stablecoins and at a later point exchange those stables for cash.
In contrast, crypto is this almost futuristic mechanism that centers developers by giving you a serverless transactional database system on which you not only can work with money but you can implement your own money. I can build my own mechanisms for authenticating access to that money, including--if I wanted to--replicating whatever features I liked from traditional systems. It offers functionality similar to ACH and wire transfers, but as a truly federated system that allows anyone to participate. Does it allow scams? Sure... but only in the same sense that other open systems like telephone networks, e-mail, and the web allow people to run scams! Are you really so closed minded as to not think everyone should get the power to automate their own lives as they see fit? God... I bet you are also one of those people who insist no one should be allowed to write or even install software on their own devices without going through Apple, or who insist that private end-to-end encrypted messaging is going to end civilization by mostly empowering terrorists, child abusers, and "Drug Cartels" :/.
Saurik, it is HN, where people complain endlessly about Paypal, but never want to fix it because that would be 're-inventing banking'.
Nothing like losing all your money because you can't unlock your wallet any more. Or sent it to the tip.
look into decentralized finance and you will be amazed
But hey now you got my interest: if it's not for normal people for whom is crypto then in your opinion?
[1] This is too long to explain but basically something similar to multisig and time locks to add extra security. Nothing like this exists at least easy to use right now.
If my non-tech savvy grandma wanted to own some bitcoin, I'd probably suggest she just keeps it on the exchange. Counterparty risk is probably less than risk of user error.
I sure am glad that I can be my own bank!
The time before, I phoned my bank and told them I had a charge I didn't recognize, they asked me to fill in a form and refunded me within 48 hours.
top of HN today
EDIT: link to thread https://news.ycombinator.com/item?id=33125442
People always say this, but you definitely have to trust that a group of unknown validators/miners/stakers will choose to keep working on your chosen chain, just as much as you have to trust that the bank will keep doing it's job as they promised you they would.
And before you say "I don't need trust, validators have economic incentive to keep doing it, and if they don't someone else will", I have something to tell you about why people choose to work at banks (it's the salary).
This statement supports exactly the opposite of the point you're trying to make.
Think about it:
* Bankers have economic incentive to work at a bank (the salary)
* Validators have economic incentive to work on your chain (the block rewards)
That's literally the entire point. You don't need to trust any validator, only that the majority are self-interested, rational actors.
My point is that by the same logic then banks are also trustless.
You need to trust bankers because nothing prevent them to just take your money. They're not working for you, they are working for the bank.
They can 100% choose to stop validator your particular chain, therefore causing all transactions to cease.
Remember when that literally happened to Solana?
> My point is that by the same logic then banks are also trustless.
There's no logical connect with what you're saying at all. Ethereum is "trustless" because nobody can steal ETH from a properly secured wallet, not even the validators.
You should probably understand the basics of how validators work before making a comment on them....
And to be clear, what I mean is that there's nothing to stop validators from not doing work on your behalf, therefore killing the chain.
Remember when that literally happened to Solana?
Edit: >You should probably understand the basics of how validators work before making a comment on them....
I'd love for you to walk me through, in detail how Ethereum and Bitcoin compile transactions into blocks, since you're the expert.
This is an even better incentive mechanism than a bank salary. It's like if a bank made all it's employees keep all their money with the bank and if they didn't do their job they lose all their savings.
1) My joke was how much work you were having “properly secured” do. It’s a genuine trope called no true Scotsman. Every crypto phenomenon that involves theft “wasn’t decentralized enough” or “wasn’t properly secured”. But then centralized databases are discussed as a monolith.
2. > Ethereum stakers are subject to an Inactivity Leak penalty if they don't do work for the chain.
Sure. That’s an economic incentive. Bank workers get fired and lose salary if they don’t show up.
3. > It's like if a bank made all it's employees keep all their money with the bank and if they didn't do their job they lose all their savings.
Yeah, like getting paid in stock?
Edit: still waiting for the definition of a mempool as well.
They can suddenly leave your cryptocurrency of choice by simply cashing out and switching to the "block rewards" of another crypto scheme, and then you are going to be alone with the bad actors.
But my main point is that people see a problem with the government and jump to the conclusion that we should just get rid of the whole institution without understanding the history of that institution. So bitcoin decided to get rid of govt control of money, which is just like a small town getting rid of their property taxes. It sounds great and works great until a bridge unexpectedly collapses and you have no way to pay for a new one, or until someone finds a bug in your defi code and borrows all your crypto for 1000 years at a zero interest rate.
"Any crypto that is actually usable by normal people isn't real crypto and any problems with that stuff doesn't count!"
This “buh buh buh Bitcoin isn’t a crypto!” meme that’s popped up since the last major crash is childish.
> We hear stories here every now and then about how their bank/paypal/etc froze their money and they are fucked. Crypto allows you to actually own your stuff. With fiat unless you hold cash, you can't do that. Crypto is about being trustless.
It's funny how you write "with fiat it unless you hold cash, you can't do that". So what you mean is really with fiat you can do it just as well? The reason why people don't want to hold large amount of cash is convenience, the possibility of it getting stolen, lost... Interestingly many of the same reasons why people don't want to hold crypto themselves either.
I'm not even endorsing crypto, Just pointing out how much people misunderstood what the point of crypto even is. No company should receive money for holding your keys unless its dropbox
We hear stories here every now and then about how their bank/paypal/etc froze their money and they are fucked. Crypto allows you to actually own your stuff. With fiat unless you hold cash, you can't do that. Crypto is about being trustless.
If you give away your crypto to some centralized entity and "trust them" that they'll keep your stuff and not steal it, then you don't get the point of crypto and you're using it wrong.
Yes, I know holding your own keys is hard. There are a lot of things that can be done to improve the UX. And even then, I don't think crypto needs to be easy enough for your grandma to use it, because I don't think crypto needs to replace TradFi for every transaction.