Don't Bank on the Old System with Crypto Wallets???
Alejandro Cuauhtemoc-Mejia
Director | Digital Marketing l Global Growth | Strategy & Operations
The best-known digital currency, Bitcoin was built for institution-free transactions offering privacy and safety features. But we ruin it all when we use digital crypto wallets; it’s the same model as traditional banking. Actually, most Bitcoin holders don’t even have their coins, but they don’t know it!
What makes Bitcoin so different from traditional banking?
And therein lies the problem…
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To own Bitcoin, you have to download the whole blockchain. At this point, every coin is about 400 GB and cumbersome to store. Most holders just use a digital online wallet, where the providers keep the coins for them.
The wallet has two keys, one public and one private. It gives the public key to the user to receive Bitcoin. Users unlock the wallet using the public key. But it’s the wallet that is actually performing the transaction with the private key, saving the whole blockchain. Yes, like a bank.
So we are back to a no-freedom transaction system, with no privacy, and no safety. The wallet provider could scam, steal, or call for BANKruptcy. The government could start regulating wallets.
If we really want to protect our crypto from thieves and regulations, we should own the whole blockchain without intermediaries banking the cryptosystem and making bank from your Bitcoin.