Do you mean you do not have any business insurance in case you get hacked?
No, I was referring to legal fiat deposit insurance that comes when you deposit funds in a regulated financial institution. As of today, no Bitcoin exchange has insured fiat deposits since no Bitcoin exchange is regulated as a financial insitution nor does any exchange partner with a financial instition for fiat storage.
Currently, all Bitcoin exchanges work the same way, your fiat deposits are pooled on one or several bank accounts with no clear funds segregation. To have insured fiat deposits would mean that every single customer has a nominative account with a regulated financial institution (not necessarily a bank though) that could either be the exchange itself, or a business partner.
I am very satisfied with bitcoin-central.net so far, but if you don't have insurance, could you describe the security measures taken to protect your customers EUR and BTC funds?
There are both organizational and technical steps taken to protect customer funds :
- The people who have full access to the bank account are clearly identified, they have different credentials to access our bank's interface, I personnally have read-only access,
- The software has read-only access to the bank account,
- The vast majority of our BTC deposits are in cold-storage, with the private keys securely stored in an actual bank safe meaning it's easy to send funds there, but hard to get them out, especially at gunpoint,
- We keep very little funds on our servers, they are operating since late 2010 and to date have never been compromised,
- We're very serious about preventing fraud and monitoring activity to avoid having bank accounts frozen or other bank-related issues
Security is *always* implemented in a combination of organizational and technical measures :
- If you have reasonable technical measures but weak organizational procedures you end up with the Bitcoinica fiasco (employee steals the money), or the MtGox incident from June 2011 (an auditor's computer was compromised, had access to data he shouldn't have)
- If you have weak technical measures you end up like Bitfloor (unencrypted backup gets compromised),
- If you don't have very good relations with your bank you end up like Intersango/MtGox with accounts frozen
That's how we run things
What funding options do you accept from UK people? (With only a Barclays bank account and no way to verify residence according to all the documents that are acceptable for such a task on Mt.Gox (university))
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