Topic: "Not your keys, Not your coins" is not enough - page 2. (Read 936 times)

I agree with your point, but what happens after the Bitcoin/crypto ecosystem becomes completely CEX/KYC free?
I'm sure that all the governments will start banning crypto mining and trying to shut down all DEX platforms, due to money laundering and tax evasion. Maybe the DEX platform will host their servers somewhere offshore. Maybe the DEX platforms and non-custodial wallets will fuse into one decentralized service.
Let's not forget that CEX platforms are one of the main reasons Bitcoin reached really high price levels. Will it be the same when CEX platforms go down? The centralized crypto companies abiding by the rules and regulations and imposing KYC is one of the reasons the governments still tolerate the crypto industry. I'm not a fan of centralized crypto companies at all, but they also contribute something to the crypto industry.

Decentralized exchange isn't that bad like you said.

People just need to read how to use the exchange and follow all of the instructions, most of the reason why people get scammed in DEX due to greedy and low literacy. The DEX always ask the buyer to check if the seller have send the money before release the buyer's money. But the buyer not really care about that and they easily get scammed due to the seller ask them to trade outside of the exchange where there's no escrow.

I think they know all about custodial and non-custodial wallets or the saying "not your keys, not your money.", but the problem is they ignore it because their priority goal is how to make the most profit. It can be said that, for a day trader, profit is the top concern. Furthermore, since decentralized exchanges have not yet been able to provide them with a favorable trading environment, they will look to centralized exchanges as that is the only option.
Even if Binance collapses and the DEX still cannot provide a good trading environment like CEX, traders will still use other CEXs despite the risks.

You don't have only cold wallets to use. You can choose single signature wallet, multi signature wallet to use and they are free. You can buy open source hard ware wallets if you have money but it is not at top of your list if you want something free.

Decentralized exchanges have their low trading volume and risk of scam from trade partners so if a person is not familiar with Bitcoin transaction and that type of trading, use Centralized exchanges first.

[LIST] Open Source Hardware Wallets

While I agree with the majority of things you said, let's not forget that not everyone is able to use cold wallets, DEXs, and other tools that require a certain knowledge because just one little mistake and you can lose everything. With this I'm not saying that CEXs are 100% safe but for the average Joe they work just fine. If CEXs didn't exist bitcoin would need way more time to spread and in the future they will likely succumb to DEXs but, in my opinion, for the moment we still need them since we need more adoption.

I get your point that the saying does not directly refer to exchanging Bitcoin, however anyone who is completely following the rule will already not be using CEXs to exchange.

If you deposit into a CEX or used a centralized swap service, you are violating the rule as you are temporarily giving up ownership of your coins. So, anyone following the rules will already be thinking "how do I swap or liquidate without sacrificing sovereignty?"...This question should then lead to a line of searching that would lead then to P2P & decentralized exchanges.

My point? There's no need to make the saying more obvious. If it's followed completely, CEXs aren't being used for storage, or exchanging.

I must say your experience has greatly taught you a big lesson, and that is not to trust centralized exchanges as they can’t guarantee the safety of our coins in a long period. Yes, we would always want to look for bigger and more reputable exchanges when trading, but that is just for trading purposes as we only have few decentralized exchanges that are making their own names in the market. Other than that, storing a lot of bitcoin in a centralized exchange will never be advisable anymore. You can open your own hardware wallet for better security, which will not put your coins into high risk of losing.

Some persons might not still understand what it means by not your key, nit your coin. This will take some  persons a big life experience for them to have fully understanding. There are few exchanges that had crashed and those that are victims of such exvhnages would understand what it means for someone not to have access to the key of there wallet. Even though we want to make us of an exchange for transactions, we should ensure that we are only holding small quantities of coins there so that if anything happens, it would not have greater effect on our holdings.

Miners and nodes aren't third parties, neither can they work arbitrarily, the consensus rules must be followed. Miners and nodes are contributors that are part of the BTC network and community, and it is decentralized and open because any BTC user can run their own node or become a miner.

Centralized third parties work arbitrarily, they can make their own rules or take any decision without your consent, they can confiscate your funds, suspend or stop withdrawals, etc, exchanging via bisq is decentralized, not because you depend on the internet or electricity, the world depends on that, lol. It is decentralized because there is no third party that controls your money or can take any arbitrary decision, you control the funds and trade directly in a peer to peer manner.

I see your good intention here, to make these traders aware that centralized exchanges will never be good and profitable forever. But the fact that every trader has its own point of view about centralized exchanges, then you can never take control of their actions towards the exchanges. Good thing if they just listen to the long time traders in the market since they gained more experiences than them, but traders nowadays have their own perspective and their own plans in trading. I just hope they will not suffer losing their coins from trusting these centralized exchanges.

@iwantmyhomepaidwithbtc2
I think you misunderstand some things about Bitcoin. The whole idea of Bitcoin is that it gives you control on your funds but only in terms of storing them. There is no one capable to seize your Bitcoins, to steal your bitcoins, to rob your bitcoins and to cancel your transactions. This is the privilege that you gain by acquiring and storing Bitcoins.
Thief can steal your cash and your gold, Bitcoins? Nah, if you are smart and know how to store them. If you don't pay the bills, banks can seize your funds and freeze your accounts but your Bitcoins? Nah.

If you were the lucky one that got thousands of bitcoins in 2010s, then congrats, you are a whale and probably spend every day in Ibiza and don't have to worry about p2p when you are an average guy, with the hope to one day become rich by Bitcoin, then you will struggle if you use decentralized exchanges. For example, on Binance, you can quickly deposit/withdraw Bitcoin, convert in different currencies, withdraw those different currencies, buy/sell at any moment, use leverage, do this, do that. Now, think about it, there is a reason CEXs are popular and believe me, if someone is interested in privacy so much, that person will definitely hear about DEX before he or she makes any crypto financial decision.

Sorry but sometimes I really wonder, do some people here go outside to buy a thing or have fun with friends? What about cameras that are in every corner? How do you manage to move or buy a thing without revealing your privacy? It's 21th century, things change. It's very sad but don't be so confident that you manage to keep your anonymity well-hidden from everyone.

Also, one thing that worth to mention is that, the more you try to remain anonymous, the more suspicious you look for governments. When you do p2p exchanges and deposits come to you from Nigeria, UK, Somalia, UAE, Pakistan, Vietnam, the USA and every time there are new senders that you don't know, it really makes you to look suspicious but when deposits come from registered CEX, you don't look suspicious. I really want to strongly highlight it, if you are going to maintain your privacy by using someone else's identity and revealing his/her privacy, then you are a moron (It's definitely not meant for you, I'm just generally saying).

Well, thinking that way, Bitcoin is everything other than decentralized p2p payment method that doesn't depend on 3rd parties. Actually, you depend on 3rd parties, including miners and node runners. If nodes don't broadcast and if miners don't include your transaction in the next block, you won't be able to finalize transaction. You also depend on Core developers, internet service providers, on electricity and so on. So, I would say that exchanging via Bisq is still a decentralized way.

I think that without education these people will never learn their lesson, because maybe they don't know that custodial wallets exist and have entered an exchange not really knowing how cryptocurrencies work but thinking they are trading like on the stock exchange.  That's what education is actually missing.

How can you set up a multi-sig wallet in Binance when you do not even control your keys nor have any seed phrase to your coins, there's no multi-sig set up in Binance.
There is nothing difficult in setting up a self custody wallet like Electrum for example, and backing up your seed phrase in a secure location, it is even easier than registering on Binance, sending them your picture and everything about you and then waiting to see if it will be approved or not.
Self custody wallets is for holding funds and not for trading. Trading should take place in exchanges, either centralized or decentralized exchanges, for privacy, security and trustless trading, you should use decentralized exchanges, but whichever one is chosen, the funds should be sent into a self custody wallet after the trade.

That proves that not all traders are ready and good enough. Some are just here for trading alone, without  even thinking about the security and safety of their coins. As long as they can trade and gain profits, that what’s only matter to them. But if they have been in the shoes of those people who have save their coins in FTX, perhaps it will serve as an eye opener for them not to trust and place their coins in a centralized exchange for an indefinite period of time.

It's like looking at a brand new automobile with a documented history of minor engine problems. A healthy dose of scepticism is appropriate here. However, it is as important not to discard the useful along with the useless. Binance, for instance, abides by international regulatory norms and has included innovative security features like multi-signature wallets.

Self-custodial wallets need a level of technical proficiency that is beyond the reach of certain users. Just picture giving your secret keys to an untrained individual. It's like handing someone a puzzle box with instructions to keep all the parts together. A catastrophe is just waiting to occur.

Self-custodial wallets also lack a trading platform, which is something an exchange provides. In order to participate in the buy-low, sell-high game, traders need these venues. While I can certainly see your worries, I find your outspoken rejection of centralised trades to be a little bit excessive. Like a funny host at a party, they play an important part in the ecology.

This is not true, Bisq is open source and malicious devs cannot steal your funds. Bisq does not even at anytime control your money that is deposited for trading, it is in a multi-sig wallet controlled by you and the other trading peer. I really don't know how you can be hacked since you only have to download the Bisq software and run it locally on your device over Tor, just as you would do with a software like Electrum. The only way i think you can lose your money trading on Bisq is if you are scammed by your trading peer, and that will only happen if you don't know what you are doing.

It is much easier to lose your funds in centralized exchanges because they can confiscate your funds, be hacked, go insolvent or collapse for some other reasons, your funds are always at risk because they control it.

They have bad reputation in security but the community thought that Binance will always make compensation to their users. They did it in the past but they might or might not do it in future.

I guess they will do it if they won't suffer a very big loss which can damage their exchange treasury and trigger its collapse. If a loss is big enough for a collapse, Binance will become insolvency and they will come to an unhappy ending for users, like FTX.

If they suffered a security breach in 2019 (7000 BTC lost) and then had another breach in 2022 (2 million altcoin tokens lost), that doesn't meet my personal criteria of "good".  Others may see it differently.

Everything you just posted are simply lies. Sorry frankandbeans, but two Bitcoin Core developers won't give you negative trust ratings for no reason. Plebs and newbies will have to look into them and decide. If you trick them once, shame on you, if you trick them twice, shame on them. But I'm confident they will learn, either the easy way or the hard way.


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Not sure why fruitloopfranky is once again trying to derail a non-LN topic to whine about LN, but I'd encourage people to place him on ignore if they don't want the (seemingly full time) job of correcting his lies and misinformation.  I'm also not entirely sure how I somehow became the "leader" of the "LN cult" when I'm certain there are far more experienced and knowledgeable users than I.

But in terms of the actual topic, which is monetary sovereignty and control over your own funds, both on-chain and off-chain have options that allow you to be your own bank.  LN has options if you want to sacrifice sovereignty for convenience, just like on-chain does.  I'd always encourage people to explore the options where they retain full control of their funds, but with the disclaimer that personal responsibility is vitally important.  Make sure you know what you're doing before you commence with self-custody.  That's for both on-chain or off-chain, but particularly off-chain as there's a steeper learning curve and more to actively manage.