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re: Official CryptoTalk Thread
Posted on 3/9/21 at 12:46 pm to finchmeister08
Posted on 3/9/21 at 12:46 pm to finchmeister08
coins are on the blockchain. They do not leave the blockchain. you have an address on the blockchain. your wallet stores your private key that gives you access to the address on the blockchain. If you haven't researched wallets you are much better leaving your funds in an exchange as you're not going to understand basic opsec to protect your private key.
2
Posted on 3/9/21 at 1:41 pm to keakdasneak
Posted on 3/9/21 at 2:00 pm to dagrippa
Hardware wallets are an extra security measure which allows for your coins to be unable to be moved unless you physically sign the transfer using your wallet. If I want to move coins on my ledger I need to log into the wallet on the computer initiate the transaction the physically use my ledger by putting in my passcode and accept that the funds are being moved.
Posted on 3/9/21 at 2:17 pm to finchmeister08
quote:My wallet is offline, it is not on my computer. There is nothing that could "crash" and destroy my coins. Ledger, Nano, Coldcard etc are all offline wallets
I understand the sense of having your coin in you’re own personal wallet, but I feel more uncomfortable with them on my computer that could also crash and fry at any moment. It’d be a rare occurrence, but it could still happen. It’s kinda why I don’t keep my current normal fiat savings in my back pocket with my normal wallet. Me losing it seems more probable in my pocket than it does at a bank.
Posted on 3/9/21 at 2:18 pm to finchmeister08
Honestly, if you don't have that much money into crypto, I don't think there's much reason to get deep in to having a hardware wallet. For me, I would only look into a hardware wallet if I had enough money in crypto that I would be upset with losing
Posted on 3/9/21 at 4:04 pm to bluebarracuda
Yea, imo it just has to do with what you think is riskier. An exchange getting hacked(Your bank account) or you losing access to your wallet(you misplaced your cash)
I've been trying to relate things to the real world to make sense. Another thing that has been ringing in the back of my mind is that amazon sold books, look at them now. One blockchain can seem so specialized that you never know can branch out.
I've been trying to relate things to the real world to make sense. Another thing that has been ringing in the back of my mind is that amazon sold books, look at them now. One blockchain can seem so specialized that you never know can branch out.
This post was edited on 3/9/21 at 4:06 pm
Posted on 3/9/21 at 4:08 pm to bluebarracuda
There are plenty of Million dollar accounts kept on the large exchanges.
The average investor feeling the need to keep crypto in cold storage is a weakness in the growth potential of crypto. Its like feeling you need to keep all of your cash in a safe at your house.
If there is a huge hack at one of the large exchanges, your cold storage crypto will lose most of its value in the following week anyway.
The average investor feeling the need to keep crypto in cold storage is a weakness in the growth potential of crypto. Its like feeling you need to keep all of your cash in a safe at your house.
If there is a huge hack at one of the large exchanges, your cold storage crypto will lose most of its value in the following week anyway.
This post was edited on 3/9/21 at 4:20 pm
Posted on 3/9/21 at 4:29 pm to James11111
Meh, if my stack got to the point where it was what I considered significant money, I'd rather ensure security rather than rely on an exchange's security when they are probably the target of 1000s of attempts per day.
Posted on 3/9/21 at 4:31 pm to TigerTatorTots
I mean, if you are a larger exchange like coinbase do you think they won't reimburse you for the hack? I guess that's the biggest question on what exchange you trust and if they have insurance for it
My opinion right now atleast is that it's more probable that I lose my keys/words vs a company like coinbase getting hacked
My opinion right now atleast is that it's more probable that I lose my keys/words vs a company like coinbase getting hacked
This post was edited on 3/9/21 at 4:34 pm
Posted on 3/9/21 at 4:37 pm to TigerTatorTots
coinbase is getting ready to ipo. I trust them over myself.
do y'all keep money in a chest at home instead of in a bank?
it all seems silly to me but whatever
do y'all keep money in a chest at home instead of in a bank?
it all seems silly to me but whatever
This post was edited on 3/9/21 at 4:39 pm
Posted on 3/9/21 at 4:39 pm to rocket31
I mean, i get it if you want to be "buried" with your money vs coinbase getting that money if you die and no one can claim it
This post was edited on 3/9/21 at 4:40 pm
Posted on 3/9/21 at 4:40 pm to 21JumpStreet
If I lived on a farm and had a large safe, maybe I would keep some in cold storage, but I live in an apartment in a populated area.
This post was edited on 3/9/21 at 4:41 pm
Posted on 3/9/21 at 4:41 pm to 21JumpStreet
quote:No I do not. Depending on the severity of the hack, it could very well bankrupt the exchange. Did the MtGox people ever get their coins back after that fiasco? I know we are in a different crypto world now but MtGox handled 70% of all BTC transactions WORLDWIDE back then. I just don't want to rely on companies to "do the right thing" because customers are always last on the totem pole when shite hits the fan.
I mean, if you are a larger exchange like coinbase do you think they won't reimburse you for the hack?
Posted on 3/9/21 at 4:43 pm to rocket31
quote:If a bank wasn't FDIC insured and didn't provide efficiency value of being able to transfer and buy at the click of a button, then yes, I'd keep my shite at home.
do y'all keep money in a chest at home instead of in a bank?
Exchanges don't have anything like FDIC insurance. Also holding my BTC in cold storage is not inconvenient. It takes me 30 seconds to send it to an exchange.
Posted on 3/9/21 at 4:44 pm to TigerTatorTots
Yea, makes sense. But what if that guy that had locked up what 260+ million in his cold wallet was on coinbase instead? But like you said things have changed.
Posted on 3/9/21 at 4:51 pm to 21JumpStreet
quote:Well he's an idiot for not having a backup wallet nor saved seed phrase. Granted back then his coins weren't that valuable so there wasn't a need. But as BTC price rose, he should have tightened up his storage method.
Yea, makes sense. But what if that guy that had locked up what 260+ million in his cold wallet was on coinbase instead? But like you said things have changed.
Another suggestion of mine is that if the $ amount is significant on your cold storage device, have a backup
cloned device in a different location. That way you can lose your main device AND your 24 words and still have access to your coins.
This post was edited on 3/9/21 at 4:52 pm
Posted on 3/9/21 at 5:01 pm to TigerTatorTots
I’m not opposed to leaving some of my crypto on an exchange, but honestly the a cold wallet isn’t that much to keep up with.
Keep your recovery phrase in a safe or hidden securely and choose a secure PIN and it feels fine
Keep your recovery phrase in a safe or hidden securely and choose a secure PIN and it feels fine
Posted on 3/9/21 at 5:20 pm to Ross
I need to do this but seems complicated. I’m sure it isn’t but I’m just not a computer guy. Honestly, all this cold wallet/hot wallet stuff is what’s going to keep a lot of retail investors from ever investing in crypto.
How does it work. The cold wallet connects to the internet so the coins can be “sent” to your wallet address? I’ve sent a little BTC from Coinbase to BlockFi...is it similar to that?
How does it work. The cold wallet connects to the internet so the coins can be “sent” to your wallet address? I’ve sent a little BTC from Coinbase to BlockFi...is it similar to that?
Posted on 3/9/21 at 5:32 pm to BLM
quote:
I’ve sent a little BTC from Coinbase to BlockFi...is it similar to that?
From what I understand, it’s basically the same thing.
I watched this video and have a better understanding of wallets now.
This post was edited on 3/9/21 at 7:29 pm
Posted on 3/9/21 at 6:15 pm to BLM
I would highly recommend watching 3Blue1Brown’s video on how blockchain works in the context of cryptocurrencies. For the sake of this post, just view the blockchain as a public distributed ledger we all have access to.
You’ve got a public key and a private key associated with a wallet. The public key functions as an address which we can look at on the blockchain and see BTC going to and from. This enables us all to know how much of the crypto is in this wallet.
The private key is how you authorize and authenticate sending crypto from that public address. Obviously, you want to keep this in a private and secure place or else people could steal your shite. If you host your crypto on an exchange, they have the keys to the wallet and act as custodian so you don’t have to worry about it.
If you move your crypto to a cold wallet, like the Ledger Nano S or a competitor, the private key is hosted on the flash drive in and you have to plug in the flash drive and enter a PIN to authorize any sending and receiving of the crypto. It will give you a dynamic public key as well that changes for each transaction which also makes it harder to track individual transactions to the specific cold wallet. The private key is a long string of letters and numbers so it’s sometimes nice to not have to remember it and instead have a device handle it for you. The device also comes with software that has a nice GUI showing off your portfolio, similar to Coinbase.
If you lose the wallet and the recovery phrase (which can be used to generate your private key) you are SOL which is why people call it risky.
You’ve got a public key and a private key associated with a wallet. The public key functions as an address which we can look at on the blockchain and see BTC going to and from. This enables us all to know how much of the crypto is in this wallet.
The private key is how you authorize and authenticate sending crypto from that public address. Obviously, you want to keep this in a private and secure place or else people could steal your shite. If you host your crypto on an exchange, they have the keys to the wallet and act as custodian so you don’t have to worry about it.
If you move your crypto to a cold wallet, like the Ledger Nano S or a competitor, the private key is hosted on the flash drive in and you have to plug in the flash drive and enter a PIN to authorize any sending and receiving of the crypto. It will give you a dynamic public key as well that changes for each transaction which also makes it harder to track individual transactions to the specific cold wallet. The private key is a long string of letters and numbers so it’s sometimes nice to not have to remember it and instead have a device handle it for you. The device also comes with software that has a nice GUI showing off your portfolio, similar to Coinbase.
If you lose the wallet and the recovery phrase (which can be used to generate your private key) you are SOL which is why people call it risky.
This post was edited on 3/9/21 at 6:19 pm
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