The Safest Bitcoin Savings Wallet

[dvds420]

Hello everyone,

I now I am extremely new on this site as I have decided to come here as requested by a friend to spread my idea and perhaps get some members together to make this project happen. I have seen a lot of projects just posted around the web about Bitcoin wallets that have all these different features to make them safer and what not, but most of them just emulate virtual wallets. What do you do with your money when you don't want it stolen and perhaps would like to gain interest? Well of course you put it in a bank!

My idea is to write a program and host a secure server that not only will work as a wallet, but also a bank to those who would like to lock up their Bitcoin and also get an interest rate on it. I don't think any other wallet out there can really offer that. I myself do have some programming knowledge with client side stuff, but know nothing of server side programming and would like to form a team to make this project happen. I'd be glad to answer any questions that anyone has on how I will go about doing all this. If anyone is interested in the project and would like to join my team or perhaps help me in some way I would very much appreciate it.

Thank you all in advance.

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[Uptrenda]

I don't mean to dampen your spirits but you should probably do more research on competition first before starting this.

(You're describing a standard multi-sig wallet which has been a thing since early 2014.)

[avatar_kiyoshi]

Bitcoin don't need a bank, your wallet is your own bank. AFAIK bitfinex is offer an interest, and they trusted.
if you want to build a secure wallet, you need research first.

last time i see a wallet which offer some interest is turn into scam.

[RustyNomad]

Could you possibly share how you will do the interest payments meaning where will the funds come from to pay such interest?

If it will come from fees it would mean that the fees would have to be higher than the interest paid which makes the whole objective of earning interest pointless.

Also, have you thought of insurance meaning will you be offering insurance on the coins stores with you? If not what kind of assurances will 'investors' have against losses.

[alwinlinzee]

I am of the opinion that you should have completed the project and bring it up here for test run but as for interest, people might be interested in it and that is if it is good.

[tiggytomb]

This could be a good idea if it was 100% secure and trusted, why not make some interest on your Bitcoin, good luck I hope you succeed.

[dvds420]

Thank you all very much for your replies and questions! As it was brought up multiple times, how will I pay interest? How much and how often? Well I plan on making interest on it like any other bank would. I haven't decided if this will work like a savings account or more like a "Certificate of Deposit" kind of deal. I'm trying to aim towards a savings account so users can still access their funds and such, but anyway I plan to use the money in the users savings accounts to loan it out to other users of Bitcoin. To get a loan from me they would 1) Have to show me a credit score with a picture of them holding their identity card and SSN may be needed as well. 2) Users would probably have to start with a tiny loan before they were trusted with a bigger loan. 3) Proof of address and income would be needed along with perhaps linking credit/bank account.

Now how could I insure someone wouldn't run away with the money? Well I will gladly insure the money loaned out using whatever money I have made from loaning out cash. What if the total money in all the savings accounts is more than I have? Well lets say I have $1000 and there was 2 savings accounts both with $1000. So the total would be $2000. I would only invest $500 of each and they would only get a percentage from that $500 so if anything were to happen to either of their, money I could easily back it. Why wouldn't I just run and keep my $1000 to myself? Well honestly I'm trying to make a real project here and in the long run this project will be worth more than running with $1000 or running at all.

I can't exactly put up this project for people to test yet, but I will try to develop a beta here over the next week or two. Is anyone willing to be on the test team?

[OBAViJEST]

The safest bitcoin wallet should not be connected to the internet, period.

My idea:

Transfer all funds onto paper wallet.  Seal paper wallet inside a zip-lock, with some cotton to absorb any possible moisture.  Put zip-lock inside air-tight container, and fill container with a powder/inhalant of noxious makeup (so only you know to wear a gas mask when retrieving funds).  Lock air-tight container with padlock/other security device.  Bury underground deep in the woods.  Place trip-mines around vicinity of dig site.

That should keep your BTC safe   

[RustyNomad]

Thank you all very much for your replies and questions! As it was brought up multiple times, how will I pay interest? How much and how often? Well I plan on making interest on it like any other bank would. I haven't decided if this will work like a savings account or more like a "Certificate of Deposit" kind of deal. I'm trying to aim towards a savings account so users can still access their funds and such, but anyway I plan to use the money in the users savings accounts to loan it out to other users of Bitcoin. To get a loan from me they would 1) Have to show me a credit score with a picture of them holding their identity card and SSN may be needed as well. 2) Users would probably have to start with a tiny loan before they were trusted with a bigger loan. 3) Proof of address and income would be needed along with perhaps linking credit/bank account.

Now how could I insure someone wouldn't run away with the money? Well I will gladly insure the money loaned out using whatever money I have made from loaning out cash. What if the total money in all the savings accounts is more than I have? Well lets say I have $1000 and there was 2 savings accounts both with $1000. So the total would be $2000. I would only invest $500 of each and they would only get a percentage from that $500 so if anything were to happen to either of their, money I could easily back it. Why wouldn't I just run and keep my $1000 to myself? Well honestly I'm trying to make a real project here and in the long run this project will be worth more than running with $1000 or running at all.

I can't exactly put up this project for people to test yet, but I will try to develop a beta here over the next week or two. Is anyone willing to be on the test team?

You will have to relook your business model.

You say that you will only loan out an amount equal to what you can cover and or equal to what you actually have on hand yourself. This is a flawed model from a clients perspective. That would mean that if you only had $1,000 yourself but that your clients 'saved' say $20,000 with you that you will still only give out $1,000 in loans as that is all you can cover.

This would mean that the possible interest that could be earned by a client will not be tied to the amount they save with you but rather to the amount you can afford to give out in loans. So whether I place a $1,000 and or $100,000 with you makes no difference as I will still just get interest on the $1,000 you can give out in loans. So there is basically no incentive for me to save larger amounts with you.

Also, if this is the model you will be working with then you do not need any clients. If you only have say $1,000 and you will only give that out in loans then why do you need clients to place funds with you? You are not really going to use their funds to make loans as you will only give out what you yourself have yet you will pay the clients interest. So you are in actual fact going to pay your clients for taking no risk.

If you just do the loans with your funds (which you are actually plan on doing) and keep all the interest for yourself you will be better off.

So thats why I say this model is flawed. There is no incentive for your clients to save larger amounts with you as they will not get any more interest until such time as you personal funds increases and secondly you will be doing yourself in as you will only get interest on the loans generated on your own funds yet you plan on sharing this interest with the clients.

You will be better of to just do this without any clients.

[dvds420]

Sorry I probably should have been more specific about the $1000 model thing I had mentioned. That was only applying to this project while in beta with a small beta test group. After beta I can insure users up to $250,000 each. Sorry for not explaining it was late at night.

[jdebunt]

as far as most people are concerned, there is no such thing as a safe Bitcoin savings wallet. You will always rely on a third-party service.

[Enzyme]

The only way you can pay interest is by handing out loans yourself. This could become possible but it's highly unlikely due to the anonymous nature of Bitcoin. In other words, it ain't gonna happen

[RustyNomad]

Sorry I probably should have been more specific about the $1000 model thing I had mentioned. That was only applying to this project while in beta with a small beta test group. After beta I can insure users up to $250,000 each. Sorry for not explaining it was late at night.

If you can do this then scaling would not be a problem.

The biggest problem I forsee is firstly risk management. If you are going to lend out bitcoin then you will have to make sure that your risk management is up to scratch. You will not be able to do fractional reserve type lending like banks where you can lend out 10 or 20 times of what you actually have on deposit. So each satoshi of 'bad debt' will eat directly into your profits.

The second biggest problem I foresee are regulatory requirements. There are bound to be some kind of regulations in regards to running such an operations no matter where you establish it.

I think your idea is workable. The main thing will be to build trust and the only real way to do that is to have a solid and transparent plan so that each investor understands exactly how you operate, what the risks are, how they are covered etc.. If you provide this each investor/client will be able to make an informed decision and decide whether they are willing to take some risk [if any] by investing or saving their coins with you.

[Jeremycoin]

If anyone is interested in the project and would like to join my team or perhaps help me in some way I would very much appreciate it.

I wanna join your team
"but, what can you do?"
Well I can do a Beta Testing

[dvds420]

Well I have a few people I know personally who are looking for loans already. Since I know these people in real life I'd start by loaning to them, but you do have a good point on making my plan completely transparent. I should perhaps make a website for this? I'm not too great on web design I'd need some help I only really program in C++. And for the guy with the funny comment about beta testing I simply just mean I need maybe about 5 people who wouldn't mind giving me $5 each after reading the plan with full transparency and then let me make interest for you to see how well this plan works. $25 is not a whole lot of money I have to worry about insuring. Also I have come up with a way to minimize risk factors which I should have mentioned. All of your money is not going to just one person looking for a loan. I may split it between 10 people so that way if 9/10 pay their loan, you will receive profit. If there is that one person who just tried to run with the money I will openly release all of their information given to me onto my website and I will then insure everyone for the money lost.

[dvds420]

I just bought a domain for this project and will be posting about it in a separate thread.

http://bitsafe.biz

There is the link to this project.

[RGBKey]

The safest wallet will always be an offline solution, like cold storage or a paper wallet, possibly with multisig and hopefully encrypted. Read up on the options first.

[dvds420]

The safest wallet will always be an offline solution, like cold storage or a paper wallet, possibly with multisig and hopefully encrypted. Read up on the options first.

I know my options, thanks

[Ninjaskills]

good job bro!

[nero987]

Be your own bank... Wasn't that included in the base of bitcoin?

Anyway, I still wish you the best of luck with your plans...

[+Bitcoin]

Check this out before building anything similar
https://plusbitcoin.net/bitcoin-savings-account/
Similar concepts already exist!