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> Regular people right now use it through Paypal, Cash app, Venmo, Coinbase, etc. So people are using Bitcoin through trusted (in the security sense[1]) interm
by AlexandrB 6y ago
> Regular people right now use it through Paypal, Cash app, Venmo, Coinbase, etc.
So people are using Bitcoin through trusted (in the security sense[1]) intermediaries. These intermediaries are basically banks, no? Aren't they subject to all the same bad incentives as a "traditional" bank? Except their deposit are (probably?) not insured against loss.
[1] https://en.wikipedia.org/wiki/Trusted_third_party https://en.wikipedia.org/wiki/Trusted_third_party
> 'Trusted' means that a system needs to be trusted to act in your interests, but it has the option (either at will or involuntarily) to act against your interests.
- rawtxapp 6y agoIt's the short term option, yes. Well, they have to hold on to the coins, because once they lose it, they can't turn to Fed for a bailout. Lots of custodians have insurance in place [1]. In the long term, lightning is here and works, as exchanges keep integrating it, that's where most of the end-user funds for small amounts would live. 1: https://finance.yahoo.com/finance/news/bitgo-expands-cold-storage-insurance-194938290.html https://finance.yahoo.com/finance/news/bitgo-expands-cold-st...
- deleted 6y ago[deleted]