Bitcoin Forum

There are 81% of Bitcoin owners who, probably because of the lack of Bitcoin Education or laziness, say that they'll move their coins to their bank's "crypto storage" if it was available. It will not be a good future, if true.

https://cdn.imgchest.com/files/84jdczmzqb4.jpeg

Let's pretend that pie chart also represents the rest of the world, and that a large portion of the supply has actually been "deposited" under the control of centralized entities. How much of the total supply must be under the control of a Cabal before we could consider that Bitcoin has failed?

If we consider success as a large majority using bitcoin as Satoshi conceived it, P2P outside of centralised entities, we can say that it has already failed and I believe that the future trend is going to get worse.

Many people buy bitcoin simply to see if they can make a profit, from their mobile phones, and sometimes they buy a substitute product that replicates the behaviour of the price of bitcoin without knowing that it is not really bitcoin. This happens in banks like Revolut.

Add to this the number of people who buy bitcoin from centralised entities such as Coinbase or Binance, or the fact that more and more bitcoin casinos require KYC.

In this context, I am not surprised that users who buy bitcoin at Coinbase or a derivative product at Revolut say that they prefer to keep their bitcoins in a bank, because they have no idea what this is all about.

The thing is, the survey initiated by NYDIG was asking about cryptocurrency, not Bitcoin.

Most of cryptocurrency aren't intended to remove third party, so they're not used the coin/token as "be your own bank", although they have an option to hold their coin/token in hardware wallet/cold storage.

However I don't think Bitcoin is failed just because majority of people trust their coins with banks. If we refer to whitepaper, we can say Bitcoin is still failed because most of people use Bitcoin as a commodity instead of as a currency.

But the graph talks specifically about bitcoin. It is assumed that the respondents have or have had bitcoin, even if they have other cryptocurrencies as well.

On what studies are the results based on which this pie chart is based? How many people participated in this survey? Who conducted this survey? It would be nice to see a link to the source.

I would not completely trust such pictures, which, by the way, can be fabricated (survey results) in one direction or another. For example, to create public opinion that banks can be trusted to hold crypto currencies.

I am 100% sure that if you conduct a similar survey on this forum, the results will be radically opposite. I wonder what not smart people (among bitcointalk users) will vote for their readiness to entrust their crypto currencies to banks?

OP, you should add exactly the same poll to this topic.

Regarding your question: I think 30% will already be enough to consider that bitcoin has failed. I can’t say for sure (and who can) and this figure arose purely intuitively.

81% is majority and it can be a big issue in future but I am very doubtful about the information. How did they conduct the survey to get that result?

Survey methodology is important to use the sample as a reflection of the whole Bitcoin owner population. If the methodology is bad, the result will be not a good representation for the big population. The figure surprises me as I am so doubtful about reasons of those people, how did they decide to own and use bitcoin. With them, central banks are not risky and they are readily to use both central banks, their cryptocurrency storage service in future without fear that their bitcoin will be stolen.

But probably they see similar risk from centralized exchanges and central banks or even consider central banks are safer than centralized exchanges to store their cryptocurrency.

Bitcoin will not fail but those people fail with their choices and lose capital. Their failures won't be Bitcoin failure.

I mean — it's really not a surprise knowing how much bitcoin/crypto people store on centralized exchanges.

I think people will learn their lesson one way or another though, mostly through mistakes and regret — hacks, centralized exchanges going bust, governments seizing their funds, etc. unfortunately. At the very least, those who want to self-custody actually can.

Why would Bitcoin fail if the "cabal" would hold 90% of the coins?

There are 1915 addresses holding 40% of the coins, for comparison, there are around 4,000 commercial banks in the US and  762 crypto exchanges listed on Coingecko, not including derivates and defi.
Do you think that right now the wealth in coins is spread that much around?


Bitcoin is a tool, it can simply be that for some it's better as an investment for others a p2p system of transferring value, the one doesn't exclude the other and nobody can say that is has failed simply because he doesn't like the outcome. Just as some might like the same future that Wind_FURY is afraid of or even dislike his own vision of utopia. For example, I'm quite happy with all CEX going bankrupt and then in the trashcan with Binance leading the pack but when I say something like this in the forum I get one hundred angry #SAFU followers screaming at me!

In short, it's not me or you or even this forum that decides failure and success, it's the world, and the world is saying that they would love their coins in a bank! Their keys, their decision! What are you going to do, seize their coins?  ::)

I keep as little as possible on my exchange, long term stuff get's moved to HW wallet. However I do have a presence on Fidelity but they are not an exchange and I am not worried about them. I can move in and out of the market with zero overhead. You just can't move anything in or out and I kinda like that for what I use it for.

81% of Bitcoin owners does not necessarily mean 81% of bitcoins since I would assume that those 81% are rather newish to Bitcoin and accordingly have smaller holdings than the remaining 19%. So that makes it slightly less bad, in a way? Except it shows as disconcerting disregard for Bitcoin's core principles.

So accordingly I'm afraid to some extend Bitcoin already has failed. Not in the sense that it's really in danger of being under centralized control, but rather in that it has failed to convince people of trustlessness, permissionlessness and rethinking monetary sovereignty. But maybe there's still hope that folks will learn their lesson before they ruin the space for the rest of us.

Did you know the amount of coins the exchanges are holding? The coins is not belonging to the exchanges but to people that leave it on the exchanges. But bitcoin has never failed and it remain decentralized. Ignorant people can decide to leave their coins on centralized platforms, which is not the right way because that led to the lost of having the full control over owns coins.

I used picture search and I did not see anything. But it can be true or not true. Not all researches are accurate. Only when you will believe it to be true or not true is when you see the total number of people in the survey and the methodology used.

Whatever HeRetiK said. The Bitcoin community (the people, not the software or currency) has failed convincing the majority to value custody, but what else to do or say? People are just dumb. By the way, how certain are we about these stats, again? I quickly reminded stats in the crypto world are as unreliable as weather predictions during a storm.

The world is dumb, no other possible explanation. You can't be informed about exchanges going bankrupt, hacked etc., knowing that bitcoin was created for you to own the keys, that exchanges will charge you more than necessary, and still consciously choose to go in that direction. It's nearly impressive.

100%.
As long as you have your Bitcoin safely in your wallet and you own the keys to that wallet then you will have no issues how the other bitcoins are spread.
No one is going to sink billions of dollars to own majority of Bitcoins available and then destroy it.

Worse case scenario is that privacy becomes difficult to maintain cause decentralized exchanges become more and more obsolete as they lose even more customers to centralized options. This will limit privacy trading options to the barest minimum.

They won't listen to us even if we demonstrate to them the consequences of their dumb actions. The community has tried their best to convince them to have self-custody of their own coins rather than relying on any third-party solutions or custodial wallets, but those people are truly dumb and they won't listen to anyone other than their own stupid instincts or we can say their own traditional belief systems.

I'm pretty sure that most of them already know that exchanges aren't safe for their Bitcoin but still they still trust those exchanges blindly and keep their coins in those custodial wallets. We have seen many of the exchanges in past that were attacked by hackers and the assets of the users were stolen during those attacks, and those people have also learned about those incidents many times, but still they won't learn any lesson and keep their coins on those custodial wallets.

Those people will only get their lesson when their coins get hacked or the exchanges go bankrupt or show bankruptcy only to steal their coins. Most of them have heard about case of FTX, and still they act like sheep after seeing the game that the founders of the FTX played with their users. Even if we try 100 methods to convince them they will still do those dumb things until they learn their lesson when getting robbed by those exhanges.

Bitcoin does not work on the principle of proof of stake^[1], in which the owners of the currency decide to vote or decide whether it will succeed or fail. In proof of work, the currency will remain decentralized as long as the parties that decide to mine are decentralized or well distributed, so you have to focus on the full nodes and the miners more in Who owns these coins?

If we assume that Bitcoin is decentralized, then here is Satoshi's philosophy, meaning that if Satoshi wanted Bitcoin to be his peer-to-peer currency, then his vision or our vision in the forum has no meaning in a decentralized economy.

"Not your keys, not your coins" is a basis for protecting the investments of individuals and not for proving the centralization or decentralization of the network or its success against its failure.


[1] https://en.wikipedia.org/wiki/Proof_of_stake

There is A LOT of inertia involved here. For a VERY long time we have been telling people to keep money in banks, since they are insured and regulated. We have been telling people to have their brokerages hold their stock certificates instead of getting physical ones sent to them. We have been telling people to have the appropriate entity hold their bonds be it the bank / the brokerage / the government instead of keeping physical ones ourselves. Now, we are telling people that they should ignore all of that for crypto and do it themselves.

Overcoming that inertia is going to take a while. Educating people is going to take a while too.

-Dave

This is something new as I was not aware of such information that there is a huge amount of population that wants to store their BTC on the bank, but if they are in BTC and wish to store their BTC on the bank, then those people really do not know anything about the fact that "not your keys, not your coin" because all they want is some central authority whom they would blame after as many people do not like to take full control and responsibility of their assets.

But if that's the case, then they should really get some education. And these people might only adopt BTC for making money, as they have no concerns and are benefiting from the features BTC and blockchain provide.

Yeah, we know it, because if everyone was some kind of economic genius we would not have to clean any mess right now, there would be no need for Bitcoin, and fiat money would work perfectly! But since it's not the case, what are you/we going to do? Probably nothing as I don't the community getting with a plan like "No nocoiner left behind" or something like that!

People will keep investing just for gains in $, people will keep their funds on Cexs and they will worship as messiah every piece of you know what investors who is in just for the money, and we'll soon all realize that it's not that every current system is bad, the people running it made it so and the whole world is just too unwilling to make a change, so, sooner or later we're going to turn this one into a shitshow also and of course, we're going to blame the "cabal" for it!
But I hope to watch the final act from my cloud above and leave this earth while we still haven't managed to turn it into something else!


This is tinfoil material but since we started with cabal stuff, whitelist addresses!
Every exchange requires that you only deposit from addresses you prove you own to addresses you also prove you own just like your ssn or tax number or whatever, then shops are forced to do the same, as time passes more and more coins enter this loop from which no coin can get out,  so, how can decentralization help you when nobody is accepting coins from non-registered addresses except a few rebels here and there and the majority is trapped in a centralized system?

As for the mining, Foundry is at 30%, it's a closed pool with only big guys from the US mining there, people with seemingly unlimited money that keep adding gear even while profitability goes down, I even doubt those 30%, I have a feeling they are hiding hashrate in other pools not to create a panic.

when certain people "in the community" believe the future of bitcoin is not to have people receive actual confirmed value on the network to their key, but instead be handed unconfirmed txdata on a different network and told not to broadcast said tx for months..(which can be easily RBF'd).. then those certain people have failed the bitcoin test of received value

what’s really the essence of moving you crypto access to a bank? What’s the whole sense of decentralization then?
Well just like you said “because of the lack of Bitcoin Education or laziness” Because that should be the only reason someone should even think of moving their Crypto Asset to a Bank Storage.

I mean there are so many ways people can make sure that their assets are safe and so there’s definitely no essence or need to go move your Bitcoin to any sort of bank Storage. This is why people should really should first gain full education and knowledge of what you wanna do or are already doing. It’s not just enough to own Bitcoin, also know everything about it, because someone who knows everything about Bitcoin won’t be as naive as getting the thoughts of moving his Bitcoin to a Bank Storage.

That would be the most ridiculous thing I’ve ever heard in my life because that I think will be transferring the control and circulation of Bitcoin into the hands of an organization or even a person, Bitcoin said would no longer be so different from our normal fiat currencies. That’s so ridiculous if you ask me.

What matters is not the proportion of bitcoins controlled by corporations and governments, what matters is the ability of others to use bitcoins. If there are enough bitcoins to leave people with the choice to control their own money, then bitcoin has not failed. Yes, it's frustrating that corporations are trying to get hold of more bitcoin, I wish it could be used more by people who understand the value of bitcoin. But we have what we have, and as long as we can freely use bitcoin, it continues to do its job. We're not going to let corporations and governments get all the bitcoins, are we? Bitcoin will not fail, must not fail!

In Italy we already have a banking service that offers storage (and direct purchase and sale) - Hype - Banca Sella.

Storing some sats on these services (a sort of hot wallet) is an excellent option for everyday expenses, or simply for exchanging FIAT/BTC and vice versa.... entrusting all saving to a product of this kind obviously not....

I believe that these services are always necessary to increase the diffusion of btc among "ordinary" people.

I think we must not worry about such centralized storages as they will vanish with time if people get to know the reality. Bitcoin was created as a peer to peer cash transfer that eliminate middlemen completely. Moving your bitcoin to such centralized storages is like moving towards fiat based financial system. These exchanges have completely destroyed the original concept of Bitcoin.

Fortunately for the world, it doesn't. In countries with relatively long history of stable currencies and solvent banking (unless you point to extreme cases like Lehman Brothers) people will tend to trust banks. It's a totally different case in countries with unstable governments, hyperinflation (Venezuela, Argentina, Zimbabwe), or countries where banks are protected by the military and moving funds abroad is difficult (China, Russia).

I wouldn't trust a bank more than I have to, but if you guys do, go ahead and risk your coins.

I believe most people actually like learning from the hard way, until some people have a personal experience regarding a particular thing they don't buy the idea of the masses regarding safety, until they have to notice that thing that they are being told will be the prepacaution of trusting a third party with their holdings, if the pie chart is true and if it's being calculated using a real data and not just assumptions base on results collected from few people who were ask the question, then I can say that this is as a result of people having a strong hope on the banking sectors more than they believe in their self and this could be because of the insurance which back up the banking sectors with hope that anything that happen to their coin the bank will make provision for replacement. (But I doubt the accuracy of that data.)

forgetting the fact that the same bank can also freeze those funds, give them some unnecessary excuses for why they can't withdraw their funds when they need them the most, which is one thing I believe Bitcoin is against, as one needs to be in control, not just in control but full control of when they can spend and when they want to hold.

I was also thinking the same as the many platforms used to show many stats, and we all know those stats are also not 100% accurate as many people who did the survey are not necessary users of crypto assets. As many only complete the survey of such questions for the sake of money.

But if the survey is not for reward, then the number of people taking part in it also depends on whether the numbers of those people are too low in relation to the people who use it.

I think this statistic is shared just out of curiosity, but still, I think many people who are into crypto really care about decentralisation and centralization, and they really care about their coins, which is why they must agree with the statement If not your keys, then not your coins.

In any case, this is a projection of today, of the system that persists, because it should be different, in fact many of these people will not reach 2040-2050, the users who will adopt bitcoin are the future generation.

Adoption is not a short-term issue, but regardless of that, the transition is always supported by users, that is, the real change will not come from those who are now, it is the generation of relief that understands and without remorse, than a traditional banking has a one-sided benefit.

I always assumed the majority of Bitcoin "owners" currently holds their Bitcoin on an exchange. If they move from largely unregulated companies registered in the Cayman Islands to regulated brokers in their own country, I consider that an improvement.

I trust only the statistics that I've forged myself.  ;D

OP's chart seems to be rather old news from a SurveyMonkey poll from January 6-7^th, 2021.


Link to above PDF via https://nydig.com/research/nydig-bitcoin-banking-survey (https://nydig.com/research/nydig-bitcoin-banking-survey). The presented survey is more like a shiny sell flyer and it's not detailed enough to assess how they come to their statements. Based on what NYDIG represents, I'm not surprised.

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You have to gain quite some knowledge about Bitcoin to realize and embrace why self-custody is important and why you shouldn't trust others. Safe self-custody is far from easy if you want to do it right with as few single points of failure as possible and that scares average John and Jane Doe. They don't see themselves as prey of banks. Well, let them keep their illusion. Banks are good to make you feel like a customer while they gladly take the best of yours.

I would see some improvement like LoyceMobile stated, too. Some mostly unregulated companies hurt the crypto space sooner or later more than they benefit it, been there, seen it.

For the same reason people stored their funds in ftx, Celsius, mt.Gox, etc and they lost it when they collapsed, but majority of the same people are still storing their funds in exchanges like Binance today, and they believe the situation is different because cz said funds are SaFu and Binance is too big to fail :D.
Tell that to crypto services who give people the impression that they can't store their 12 or 24 words seed phrase, cz emphasized the other time that 99% of funds in self custody will be lost, sure, Binance is the safe place for their funds :D, and Ledger want people to believe their seed phrase has to be split in three for it to be perfectly safe, too many crypto services are sending the wrong message to people who don't know where to get the right info about BTC and how it should work and they are doing it to earn money for themselves.
No. If people want to store their BTC in the bank or anywhere, it does not affect BTC in itself, it's their keys, so their coins. It is their coins that the bank or centralized exchange controls, and not mine that i have in my Electrum wallet.

This action entirely goes against the reason Bitcoin was created.  As we know Bitcoin was created because Satoshi thinks that there is a need to have individuals store their own funds and there is no need for them to involve third-party financial institutions with their transactions.

Although we cannot deny these people their rights to do with their Bitcoin stash, people relying on banks or custodial services to keep their Bitcoin stashed is a failure in terms of Bitcoin purpose.

Most people realize this after they have lost money that if they are giving someone else their access they are already losing funds at the moment but still we see lots of such things happening with exchanges and still they find it secure options to store their funds in them but at last people need to realize it and learn more about self custody.

Nah. Fiat works as is, it's controlled by a few people, no matter how geniuses we were, it fundamentally works in favor of the few.

Absolutely nothing. I can't, nor do I have the time, to try and influence a dumb person's decision. "A fool and his money are soon parted", what an insightful quote. Provably true, with all those exchanges shutting down, taking people's money with them.

I'm also investing for gains, but I find the approach of keeping your keys easier and safer. It's objectively more difficult and less secure to keep your coins in some unregulated entity, agreeing into having your money taken in case they're caught to running fractional reserve banking, or getting hacked, or just gambling with your money on shitcoins etc.

Which doesn't make it "OK", right? Not your keys, not your coins. The exchange, being a centralized entity, could decide not to give anyone their Bitcoins back, AND users will be depending on their network for the safety and security of our property, like PayPal users. Therefore the question, how much of the total supply must be held in centralized vaults, under their control, before we can actually say that Bitcoin is failing? What is the threshold?

I'm like a broken record, asking this challenging question over and over again because all of the debates/discussions presented are mere unintentional-strawmen that's taking the topic out of context.

Of course :) But I trust my stock broker a lot more than, say, Binance. It depends on your threat level: if you fear your own government will take your money, then indeed storing your money at your local bank is a bad idea.

That's my point: a local bank can't do that without reason, and even if they do, at least I know who I'm dealing with. I wouldn't know who to call to send a lawyer after a guy named "CZ", who hides behind a shell company on the Caymen Islands.

I wish I could be my own stock broker, keeping shares at home without paying anyone "for safe keeping".

Unfortunately, I don't know. Most gold is stored in centralized locations, and I wouldn't call the gold market a failure.

If you Google how many people own Bitcoin, the answer varies but it's usually a couple hundred million. But there are only 48 million (http://addresses.loyce.club/total_number_of_funded_addresses.txt) funded Bitcoin addresses, which means the large majority (thinks they) own Bitcoin on an exchange. It could very well be 80% already, which is the same percentage you mentioned in the OP.

I'd argue it's not about the supply at all.

Based on the premise Bitcoin was designed with the intent of there being one sender and one recipient, with no middlemen in between;  In order to still qualify as a peer-to-peer network, then there simply needs to be at least two individual users transacting who retain control over their own funds.

It's a threshold I'm quite certain we'll never reach.

Well, I am honestly not surprised , cus if today , with the whole awareness of "not your keys, not your crypto" , Bitcoin investors still leave bitcoin's worth hundreds of thousands of dollars in their centralized exchange trading account, I don't see any reason why we should be surprised that a greater number of American citizens opt they will deposit their Bitcoin in the bank if the option is made available.
If you ask me though, this is purely as a result of laziness, the fact we can not deny is that, decentralization comes with lots of responsibilities, you have to be responsible for your wallet up keep and security of both the wallet software and the device the wallet is installed on, for those who are not into hardware wallet, this and many more are things some people might feel very lazy to look after , so they don't mind giving a third party the chance to look after this things for them of given the chance ..

Let us say that it represents the entire world and that survey has been made for many respondents, being in 81% was already a lot of percentage for those people that are trusting the cold storage of the banks instead of keeping it on their own.

I guess we still got some faith on the other side that won't move their bitcoins and will eventually change when some news about hacks do happen.

As long as there's 1% or more that are going in the right path, we can't say that bitcoin has failed.

I wouldn't be bothered with the data that is not representing the entire world on a practical basis. Plus there is no way this data can be considered true because there is not even 1-2% of the world's population that has been involved with Bitcoin for 10+ years. I am definitely sure this means nothing with the study that has already been conducted. There were many studies like this that are coming up front and peeps are making unreal assumptions about it. If peeps are not actually involved with Bitcoin then how could they possibly say positive things about it?

Let me also add that if there are only such low number of the population that is directly involved with Bitcoin then also we have a mega moment throughout the world with many government getting scared about decentralization. Just imagine what would happen in the case of 50% population getting involved?

Try the survey at that time. It would bring out different set of results for sure.

says the centralist guy that LOVES promoting that everyone should shift over to a subnetwork that uses middlemen(routers), leaving only a few people left on the network doing real peer-to-peer control of their own funds


yep we know you only want a few elitist people left using the actual bitcoin network, where its just the elitist faction of the economy swapping THEIR reserves. we all know your mindset and manifesto. just a shame you are trying to teach centralism/offramping as a feature everyone should use under the false pretense that bitcoin wont work without it.

funny part is the subnetwork you want everyone to use is already failing its self control promise even with less than 5000btc network total liquidity. where subnetwork people are now promoted(by you and your chums) to hand funds to a custodian(wallet manager) and then they be given(by centralised key holder) faked, unconfirmed msat balance(inbound balance) AKA factory channel feature

No one cares what you think, BlockchainHitler.  Off-chain users still have the option to do that entirely peer-to-peer if they choose to.  Users decide who they open channels with and could arrange to form a private network of known friends if they wanted (not that you have any friends, so it's understable why you can't relate).  Now stop derailing topics, troll.  This is not a thread for discussion of your favourite second layer.

Those who understand crypto very well knows that third-parties must be erased, why would anyone want to keep their crypto with banks when you have your crypto wallets, (the safest place for your crypto currencies) , well you've said it all, most people lacks understanding about why crypto existed, most importantly Bitcoin.

The only thing the central bank and the government can't take over is Bitcoin, they need your private key to get your Bitcoin and you giving yours up means you are foolish, the real reason Bitcoin existed is because of it's ability to erase any third-party when making transactions.

Each and every individual that owns Bitcoin are responsible for whatever happens to their Bitcoin, if you think it's safer in the hands of your bank then you don't deserve to have Bitcoin, you are using it as the problem it was created to fix.

Yeah, @HeRetiK already said the same thing I felt, because I know that there are some addresses that hold a large amount of Bitcoin, so, the 81% Bitcoiners that wants to store their Bitcoin or crypto assets in the banks doesn't have or would not have a very large amount of Bitcoin in their possession, Oh! Boy... Come on, imagine someone who has been holding 100 bitcoins in their cold storage going to the bank to store them because of some bullshit bank crypto safe storage. It's never going to work.


Someone that have about $100,000,000 worth of assets in Bitcoin would not want to do foolish things that can risk their asset, but would definitely want to learn and acquire every necessary education that can help them keep their investment or asset safe. @Wind_FURY, If you have a huge lump of money (like the figure I mentioned above) in your possession, you will not really be lazy about the security of that fund; you will definitely make sure that your money is secure, but when you have just $1k or $5k, you might not treat the security of your asset the way someone who has $100 million would treat theirs.

Just like the "read" on that chart, which states that "most Bitcoin holders in the U.S. would move their asset to the bank if it had a safe crypto storage," I want to say that the U.S. is not the entire world, and the entire world is not foolish, so I don't see this happening any way; only the uneducated bitcoiners will store their bitcoin in a centralised organisation.

OK, then from that premise, if User A owned and locked 99% of the total supply, with new participants having to ask permission from him/her to use the currency, then could we say that it has failed or not? The answer is obvious.


But what is the threshold? Where should the network participants draw the limit? I'm merely asking out of curiousity.

I like DooMAD's answer, so that puts the threshold at 2.

New participants already have to "ask" someone to use Bitcoin. Usually that "asking" involves paying them to buy Bitcoin, but the end result is the same: they need something from existing Bitcoin owners (and obviously I'm ignoring the possibility for mining here, because that's not what most new Bitcoin users do). Luckily, money talks, so there's always someone willing to make a deal.

One of the great things about Bitcoin is that it doesn't matter what other people or even governments do. "They" can use Bitcoin custodial, on side-chains and second layer, or a bank could even make up "fractional reserve Bitcoin". As long as I have my private keys, none of that matters to me.

It does. The price is determined by the collective prosperity of the network. We're being reliant on the partition of work, and the value of our work is defined by beyond what ourselves and our people value. It's defined by the competition among all people doing the same work. If individuals beyond this forum deposit coins into exchanges, and these exchanges subsequently employ fractional reserve systems, leading to an increase in the money supply, it will directly impact the value of your coins. (as it happened already with FTX)

"2"? Therefore if two entities controlled 90% of the total supply it shouldn't be concerning? There would be a possible custodial banking situation for Bitcoin. It should definitely be concerning.

The "2" argument is good for boot-strapping the network because it starts with at least two peers. I'm asking about something else entirely.


That's at the current state of Bitcoin because the supply is fairly distributed. I'm asking about how much of total supply must be controlled by a Cabal before it becomes truly concerning. Because controlling most of it might mean a custodial banking future for Bitcoin, in that the Cabal might let you use "Bitcoin", but only as IOUs in their centralized ledgers.


A custodial banking future for most of the supply of Bitcoin won't be concerning at all? If that's the future, then those users are not actually using Bitcoin. Concerning if many people will believe that's "OK".

Decentralized things become centralized once it is put into a centralized platform. Bitcoin can only give you the full potential of decentralization as long as it is in your hands. By keeping it in a centralized bank's vault, you will hand over your control over the asset. I am not sure if is it because of laziness or lack of knowledge, but because people don't want to take the blame for their own actions. They try to blame others. What if the bank goes bankrupt, They can't create new Bitcoin out of thin air as it is that easy for fiat money. Once it is lost, it is lost.
So what's the point of keeping Bitocin in a centralized bank? Those people need to learn what it means to be fully decentralized. Otherwise, when they lose it all, they will blame it on either Bitcoin or the bank. They will never think that they were the ones who put it in there in the first place.

The presence also bears the "decentralized" status, signifying the absence of any regulating entity. Moreover, users possess the freedom to determine the usage of their BTC as they see fit. There exists no centralized institution coercing BTC users down a particular path; however, each of these institutions wields a potent marketing strategy. Regrettably, this has led to a scenario where many individuals have begun entrusting their Bitcoins to third parties.

If you disagree with the current state of affairs, do you wish to compel all these third-party entities to adhere to your commands? Alternatively, do you aspire to assume control of all the BTC held within centralized institutions?

I would say it would be 51% on which it is really that considering that Bitcoin had failed but well numbers couldnt really be just that a solid thing that would indicate that Bitcoin did really fail.It id really just turns out that

lots of people didnt understand the true utility or the whole reason on Bitcoins existence on the time that they would be entrusting their coins into those banks which we know that they are really that heavily centralized.
People never ever learn until they would be able to realize that they are still under with government surveillance or simply with their eyes on which everything could really be traced on or simply people do make out some crypto investment for the same of not making themselves getting behind on whats the new trend or whats the current popular thing but misses out the whole point on what Bitcoin is all about.

For those enthusiast then they would be surely be laughing into those people who had still trust up with those institutions despite on owning Bitcoin. They arent just that simply
aware on what decentralization or anonymity is.

There is no force - but only the best advice so that bitcoin users are fully aware of the risks involved in entrusting their investment assets to third parties.

Every user must know that they have the right to take care of their own assets as if they had a bank in their own hands. Some do ignore the risks - but others do care. In the end, each of them has a different risk tolerance so they are free to make choices where and how to store their coins. Even if we recommend something useful - it's hard to change the decisions of people who believe in something they think is safe.

As a matter of fact, that number is already suggesting that Bitcoin has somehow failed. But this is not representative of what the future brings. And, of course, that's not even saying that Bitcoin is a failure. Bitcoin remains to be what it is-- a solution to the big fiat joke. These survey numbers don't debunk that. Anybody who wishes to opt out of the fiat anytime has Bitcoin to run to. And these people who have yet to thoroughly understand or absorb the failure of the fiat and banking systems may one day get it.

Simply said, I'm not at all bothered by this. If there's 5% of the entire global population who have sought refuge in Bitcoin either because they're unbanked or because they've been victims of extreme inflation, unlawful seizure or censorship, exorbitant remittance or payment processing fees, and so forth, then Bitcoin has already served its purpose.

We must not forget one thing: being your own bank also means taking a lot of responsibilities: one simple mistake and potentially you could lose everything you have, with no possibilities to get it back. Not everyone is ready to take such risk. 81% anyway is a lot, I didn't expect such high percentage, hopefully in the future that number will decrease.

It's truly a challenging question that should never be stopped from being considered and reconsidered. Centralized entities accumulating more and more Bitcoin under their custody could open another "possible" attack vector, and it could be very dangerous.


I believe many people currently don't care, but they should, and I believe they will. Let's hope that either it will not be too late, or that they learn the easy way. 8)

While the pie chart may be alarming, let's not jump to conclusions about Bitcoin's failure just yet. It's important to remember that the strength of Bitcoin lies in its decentralized nature. As long as individuals continue to hold and transact with their own keys, the true spirit of Bitcoin lives on.

You're right, its strength and "robustness" does rely in its decentralized nature, but that's truly the question. What's the threshhold? 50%? 60%? What if more than 70% of the total supply are held in the vaults of trusted-third-parties?

Currently, these are the largest centralized entities that HODL Bitcoin in their vaults, it's probably growing, https://bitcointreasuries.net/?maximized=treemap

It could continue to get worse after legacy asset managers like BlackRock start buying and HODLing Bitcoin in their vaults too.

Those third-party services will cause more problems for people who use those platforms to store their bitcoins.

Will it affect people who are more knowledgeable, experienced and careful to store bitcoins in their non custodial wallets?

Short term, they can see losses on screen, paper losses when market is dumped by fiascos from third-party companies like FTX, Terra. But if they can hold, don't trade, don't use leverage, they will not have forced liquidation and they will be fine.

Long term, they will get benefit as people who lost bitcoins, and bitcoins lost forever including from third-party fiascos will be gift for everyone, donation to everyone.

not your keys not your coins is not a % of network strength

the network strength has nothing to do with keys..
its the decentralised nature of the blockchain, where the ledger is not locked to a centralised server for a one copy ability to edit.
its the decentralised nature of the mining power that the blocks are not all created in one location/jurisdiction/controller

the not your keys not your coin is about personal wealth protection

the network does not fail if numbskulls think they own value in a custodian. its the numbskulls failing themselves by not protecting their value by not using the network

you cant claim the network has failed, due to users not even using the network.. its the users not using the network that failed themselves

It's merely a question of how much of the total supply should be in the vaults of centralized entities before we can start to say that Bitcoin is failing as a permissionless, censorship-resistant cryptocurrency. Because if you store your coins with a centralized third-party, those coins are not truly yours, their not permissionless, and definitely not censorship-resistant.

Plus we haven't started to truly think about the situation of "what if most of the Bitcoins in circulation are in the vaults of centralized institutions", which might be a topic of serious concern years from now if some threshold is reached?

the main risk is if the FEE's become to impractical for normal people to operate on the network, which then forces people into using centralised custodians of offchain systems, is where problems start

although i have ALOT more coins on my keys then you, does not make me more decentralised then you for having more coins in my control of my value/wealth.. the amount per users is not important
the utility of the network  to allow peer to peer payments is important

if centralist idiots are telling people not to do their coffee/pizza purchases on bitcoin and promoting bitcoin fees should rise and suggesting people should rent out some other systems balance to make payments on other systems.. thus giving funds to custodians.. thats where the problems start

a certain person thinks bitcoin should become a system that only supports 2 custodians peer-to-peer reserve swapping, where all of their customers use another network.. and he calls that bitcoin decentralisation success

the not your keys is not the failure.. the fee wars and limiting transactions per block, is where things fail, because it promotes making people give up coin control to have convenience (your chicken fear comes after the egg problem that causes your fear)

I wouldn't be so hasty as to attribute this answer to their "lack of awareness". Most of the time, people will choose convenience over security if they were to be given a choice between the two. This is also the reason why most people would prefer having money sent over to their exchange addresses or hot wallet addresses instead of their cold wallets. It's just way easier to transact especially if the wallet you have is more on the connectivity side of things.

I say until we get a wallet provider that offers both security and convenience, people will continue using these exchange wallets since it's just that workable having them around. The rest of us had to deal with it and continue with the not your keys not your coins narrative.