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>For the vast, vast majority of people, they will be much better off letting someone else handle their wallet. Why?

aaron-lebo 12y ago
As I stated, it does take some work to make sure your wallet is secure and redundant (or even just your private key). Most people are just barely computer-literate, and therefore can't realistically do that. For them, third party services are a much better option.
- georgemcbay 12y ago
  Or I could just skip all of the convenience and regulatory stuff that will have to be built up around bitcoin to make them mainstream usable and just continue to use US Dollars which already have all that infrastructure in place. Using bitcoin for currency as a whole (IMO) is almost like a misguided application rewrite -- sure, at the beginning it has all these advantages of being light and nimble and having limitless possibility, but by the time you add all the stuff users actually want/need back into the system you wind up pretty much right back where you started with the old heavy app, perhaps with a shift of power behind the scenes (from the old architect to the new architect, if those are different parties), but nebulous real advantages for end users at the end with a lot of transitional pain in between.
- marcell 12y ago
  The "mainstream users should use hosted wallets" meme is inaccurate. 3rd party wallets do not provide security via black magic. They use tools like passwords, 2FA, and email addresses, all of which could be compromised on a user's computer. Think key loggers, viruses, social engineering, people leaving their computers unattended with the wallet open. There is no technical reason why the security measures that Coinbase implements cannot be done using a personal wallet. Moreover, when storing coins on Coinbaes, you are additionally subject to counter party risk (Coinbase goes under, loses their coins) as well as regulatory risk (Coinbase shuts down withdrawals due to regulations).
  - aaron-lebo 12y ago
    I don't consider it a meme. Yes, they use passwords, 2FA, and email addresses, but those are all things mainstream users are familiar with and have to use for any other major service. They are not familiar with the concept of encrypting a wallet or the fact that deleting a wallet can lose you money. Of course you are at risk of something bad happening to Coinbase, but steps like getting insurance are hedges against that. I should point out that when I talk about mainstream users, I'm not so much talking about right now, but in potentially a few years when Coinbase is more of a known institution or existing banks or other parties have jumped into the game. At that point a wallet hosted by Google or something will be a much better bet for most consumers.

As I stated, it does take some work to make sure your wallet is secure and redundant (or even just your private key). Most people are just barely computer-literate, and therefore can't realistically do that. For them, third party services are a much better option.

georgemcbay 12y ago
Or I could just skip all of the convenience and regulatory stuff that will have to be built up around bitcoin to make them mainstream usable and just continue to use US Dollars which already have all that infrastructure in place. Using bitcoin for currency as a whole (IMO) is almost like a misguided application rewrite -- sure, at the beginning it has all these advantages of being light and nimble and having limitless possibility, but by the time you add all the stuff users actually want/need back into the system you wind up pretty much right back where you started with the old heavy app, perhaps with a shift of power behind the scenes (from the old architect to the new architect, if those are different parties), but nebulous real advantages for end users at the end with a lot of transitional pain in between.
marcell 12y ago
The "mainstream users should use hosted wallets" meme is inaccurate. 3rd party wallets do not provide security via black magic. They use tools like passwords, 2FA, and email addresses, all of which could be compromised on a user's computer. Think key loggers, viruses, social engineering, people leaving their computers unattended with the wallet open. There is no technical reason why the security measures that Coinbase implements cannot be done using a personal wallet. Moreover, when storing coins on Coinbaes, you are additionally subject to counter party risk (Coinbase goes under, loses their coins) as well as regulatory risk (Coinbase shuts down withdrawals due to regulations).
- aaron-lebo 12y ago
  I don't consider it a meme. Yes, they use passwords, 2FA, and email addresses, but those are all things mainstream users are familiar with and have to use for any other major service. They are not familiar with the concept of encrypting a wallet or the fact that deleting a wallet can lose you money. Of course you are at risk of something bad happening to Coinbase, but steps like getting insurance are hedges against that. I should point out that when I talk about mainstream users, I'm not so much talking about right now, but in potentially a few years when Coinbase is more of a known institution or existing banks or other parties have jumped into the game. At that point a wallet hosted by Google or something will be a much better bet for most consumers.