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Maybe someone could invent the "FDIC" of crypto in smart contract form where everyone pays a periodic premium but if a hack occurs and there is consensus they g

by dheera 5y ago

Maybe someone could invent the "FDIC" of crypto in smart contract form where everyone pays a periodic premium but if a hack occurs and there is consensus they get a payout. Only problem is everyone would have to use their own wallets for it to work, and for most people it's safer to store large amounts of crypto on an exchange instead of a wallet for personal security reasons.

itintheory 5y ago
> and for most people it's safer to store large amounts of crypto on an exchange instead of a wallet for personal security reasons. This is the opposite of what is usually recommended.
- dheera 5y ago
  Yep, I realize that, but having your own wallet means: - Everyone can track your transactions and personal wealth on EtherScan or similar tools, whereas in an exchange it is significantly obfuscated by the exchange's own collection of wallets and databases. - You could be robbed at gunpoint for your hardware wallet. - You could lose your wallet in a fire or other natural disaster. - While you can back up your wallet keys online, most people cannot remember the long passphrases, and end up writing them down on paper which isn't secure if someone were to break into your residence or office. For most users the combination of these risks far exceed the risks of keeping money in an exchange. But yeah, if you're a billionaire with a 24/7 personal security team and personal firefighter team, then yeah, by all means, keep your own wallets.
xur17 5y ago
> Maybe someone could invent the "FDIC" of crypto in smart contract form where everyone pays a periodic premium but if a hack occurs and there is consensus they get a payout. Nexus Mutual, and a few other on chain insurance protocols offer exactly this. You pay them some premium, and they pay out in case of losses due to hacks, smart contract vulnerabilities, etc. So far they've worked fairly well, and paid out in hacks like this that occurred.

by dheera 5y ago

itintheory 5y ago

> and for most people it's safer to store large amounts of crypto on an exchange instead of a wallet for personal security reasons. This is the opposite of what is usually recommended.

dheera 5y ago
Yep, I realize that, but having your own wallet means: - Everyone can track your transactions and personal wealth on EtherScan or similar tools, whereas in an exchange it is significantly obfuscated by the exchange's own collection of wallets and databases. - You could be robbed at gunpoint for your hardware wallet. - You could lose your wallet in a fire or other natural disaster. - While you can back up your wallet keys online, most people cannot remember the long passphrases, and end up writing them down on paper which isn't secure if someone were to break into your residence or office. For most users the combination of these risks far exceed the risks of keeping money in an exchange. But yeah, if you're a billionaire with a 24/7 personal security team and personal firefighter team, then yeah, by all means, keep your own wallets.

xur17 5y ago

> Maybe someone could invent the "FDIC" of crypto in smart contract form where everyone pays a periodic premium but if a hack occurs and there is consensus they get a payout. Nexus Mutual, and a few other on chain insurance protocols offer exactly this. You pay them some premium, and they pay out in case of losses due to hacks, smart contract vulnerabilities, etc. So far they've worked fairly well, and paid out in hacks like this that occurred.