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To all the people replying that crypto isn't regulated: that's a myth. Exchanges are regulated and keep KYC info of their customers. If the FTX hack is true,

by gasull 4y ago

To all the people replying that crypto isn't regulated: that's a myth. Exchanges are regulated and keep KYC info of their customers. If the FTX hack is true, then all that KYC info will be sold in the black market. Regulation didn't prevent the hack (or rug-pull?). Self-custody with DeFi does prevent it. It's shocking how some people are for tinkering hardware/software and self-hosting services like Nextcloud, but it comes to money they would rather leave their life savings with a third party (a bank or a custodial exchange) and renounce to all financial privacy.

throwawaysleep 4y ago
You going to bet your tech skills vs a hacker when it comes to guarding your money? The reason people are comfortable tinkering with hardware and software is that it involves little to no risk. The stakes are extremely low.
- the-anarchist 4y ago
  You mean a hacker that would need to enter your house, look for your hardware wallet, beat the mnemonic out of you and quickly enough steal the coins for you to not be able to transfer them yourself before he manages to find a computer with internet access that is sufficiently hidden to not be traced back?
iakh 4y ago
Is it really that surprising people would rather keep their money in a bank that has hired professional security guards rather than at home under their mattress?
- oneoff786 4y ago
  It’s a bit surprising if they spend a lot of effort complaining about banks
- gasull 4y ago
  Yes, until we had cryptocurrency.
bsder 4y ago
The difference is that when a bank gets robbed, I can still go get my money back via the legal system. When a crypto exchange or a crypto wallet gets robbed, you have nowhere to go to get your money back. There are good reasons why we don't keep large amounts of cash in our pockets or in our mattresses.
- the-anarchist 4y ago
  Good luck getting your money through the legal system when the bank collapsed!
  - notch656a 4y ago
    FDIC. Everyone else pays for your shitty banking choices via inflation instead. To me the crypto version is better TBH, which would force either private insurance or none at all. Believe it or not you can buy private insurance for crypto, which would achieve something like FDIC.
    - gasull 4y ago
      FDIC covers only up to 200k USD. Many people have lost life savings when banks collapse. Also, not everybody lives in the US or in countries with a semi decent banking system.
      - rsj_hn 4y ago
        > Many people have lost life savings when banks collapse. Do you have some data for this statement? (in the US, post FDIC deposit era) Because even when a bank fails, there is usually more than enough to cover depositors, and what the FDIC does is arrange for the bank to be taken over by a healthy bank, with the deposits migrated (but equity and bondholders can take a bath). E.g. no depositor lost a penny in the financial crisis of 2008 -- which was the biggest financial crisis since the Great Depression -- even if they had money in excess of the limits. However it's quite unusual to have money in excess of the limit -- if you have that much, you wont keep it as a deposit, you'll hold some government guaranteed bonds like agencies or treasuries. It is extremely poor cash management for an individual to have more than 200K in a demand deposit account when they can be earning more with government guaranteed bonds that are just as liquid as cash. You can even open an account with Treasury Direct.
deleted 4y ago
[deleted]
wesapien 4y ago
How do you know self hosting people do the thing you're suggesting?
- gasull 4y ago
  I've seen posts on r/selfhosted about Uniswap out other DeFi protocols being downvoted to oblivion and with comments like "burn crypto too the ground". They want people to have autonomy, except when it comes to money.
conradev 4y ago
Whatever info FTX had, sure. Looks like your private documents were stored with Stripe, a much better steward of your data: > FTX partners with Stripe to ensure a secure identity verification process. Please note data will be stored and may be used according to the Stripe and FTX privacy policies. https://help.ftx.com/hc/en-us/articles/360027668192-Individual-Account-KYC https://help.ftx.com/hc/en-us/articles/360027668192-Individu...
- Seattle3503 4y ago
  I wouldn't be surprised if FTX has a copy of all documents and PII. I don't think regulators would accept "Stripe suddenly went under" as a valid excuse for not having KYC data.
cuteboy19 4y ago
> keep KYC info of their customers This is AML. It has nothing to do with protecting client funds. Though knowing FTX, they might have advertised compliance with "Employees must wash hands" as "We are a fully reglulated exchange complying with all applicable local and national laws"
poisonborz 4y ago
Selfhosted services are typically entirely self-contained. You access them with clients controlled by you, with devices on your network, and apart from updates from trusted sources of your choice, not exchange with untrusted parties at all. I'm all for decentralised financials but the topic is orders of magnitude harder.
- gasull 4y ago
  You can self-host your Bitcoin node, the Uniswap front-end, etc. You can be your own bank.

by gasull 4y ago

throwawaysleep 4y ago

You going to bet your tech skills vs a hacker when it comes to guarding your money? The reason people are comfortable tinkering with hardware and software is that it involves little to no risk. The stakes are extremely low.

the-anarchist 4y ago
You mean a hacker that would need to enter your house, look for your hardware wallet, beat the mnemonic out of you and quickly enough steal the coins for you to not be able to transfer them yourself before he manages to find a computer with internet access that is sufficiently hidden to not be traced back?

iakh 4y ago

Is it really that surprising people would rather keep their money in a bank that has hired professional security guards rather than at home under their mattress?

oneoff786 4y ago
It’s a bit surprising if they spend a lot of effort complaining about banks
gasull 4y ago
Yes, until we had cryptocurrency.

bsder 4y ago

The difference is that when a bank gets robbed, I can still go get my money back via the legal system. When a crypto exchange or a crypto wallet gets robbed, you have nowhere to go to get your money back. There are good reasons why we don't keep large amounts of cash in our pockets or in our mattresses.

the-anarchist 4y ago
Good luck getting your money through the legal system when the bank collapsed!
- notch656a 4y ago
  FDIC. Everyone else pays for your shitty banking choices via inflation instead. To me the crypto version is better TBH, which would force either private insurance or none at all. Believe it or not you can buy private insurance for crypto, which would achieve something like FDIC.
  - gasull 4y ago
    FDIC covers only up to 200k USD. Many people have lost life savings when banks collapse. Also, not everybody lives in the US or in countries with a semi decent banking system.
    - rsj_hn 4y ago
      > Many people have lost life savings when banks collapse. Do you have some data for this statement? (in the US, post FDIC deposit era) Because even when a bank fails, there is usually more than enough to cover depositors, and what the FDIC does is arrange for the bank to be taken over by a healthy bank, with the deposits migrated (but equity and bondholders can take a bath). E.g. no depositor lost a penny in the financial crisis of 2008 -- which was the biggest financial crisis since the Great Depression -- even if they had money in excess of the limits. However it's quite unusual to have money in excess of the limit -- if you have that much, you wont keep it as a deposit, you'll hold some government guaranteed bonds like agencies or treasuries. It is extremely poor cash management for an individual to have more than 200K in a demand deposit account when they can be earning more with government guaranteed bonds that are just as liquid as cash. You can even open an account with Treasury Direct.

deleted 4y ago

[deleted]

wesapien 4y ago

How do you know self hosting people do the thing you're suggesting?

gasull 4y ago
I've seen posts on r/selfhosted about Uniswap out other DeFi protocols being downvoted to oblivion and with comments like "burn crypto too the ground". They want people to have autonomy, except when it comes to money.

conradev 4y ago

Whatever info FTX had, sure. Looks like your private documents were stored with Stripe, a much better steward of your data: > FTX partners with Stripe to ensure a secure identity verification process. Please note data will be stored and may be used according to the Stripe and FTX privacy policies. https://help.ftx.com/hc/en-us/articles/360027668192-Individual-Account-KYC https://help.ftx.com/hc/en-us/articles/360027668192-Individu...

Seattle3503 4y ago
I wouldn't be surprised if FTX has a copy of all documents and PII. I don't think regulators would accept "Stripe suddenly went under" as a valid excuse for not having KYC data.

cuteboy19 4y ago

> keep KYC info of their customers This is AML. It has nothing to do with protecting client funds. Though knowing FTX, they might have advertised compliance with "Employees must wash hands" as "We are a fully reglulated exchange complying with all applicable local and national laws"

poisonborz 4y ago

Selfhosted services are typically entirely self-contained. You access them with clients controlled by you, with devices on your network, and apart from updates from trusted sources of your choice, not exchange with untrusted parties at all. I'm all for decentralised financials but the topic is orders of magnitude harder.

gasull 4y ago
You can self-host your Bitcoin node, the Uniswap front-end, etc. You can be your own bank.