Bitcoin bank accounts now available to European citizens

[hugeblack]

Berlin-based crypto banking startup Bitwala has announced the launch of their bitcoin banking app for iOS and Android.
The company said that all bank accounts will be hosted by solarisBank, a licensed German bank supervised by the Federal Financial Supervisory Authority (BaFin), and deposits up to €100,000 will be protected by the German deposit guarantee scheme.
Customer Bitcoin balances, according to the company’s chief financial officer Christoph Iwaniez, are “booked directly on the Blockchain via a multi-signature wallet,” allowing customers to be “fully in control of their wallets at all times.”

Read more and source ---> https://finance.yahoo.com/news/bitcoin-bank-accounts-now-available-184131158.html
Bitwala seems to have started a good project, especially as accounts are multi-signatures, allowing users the opportunity to control their coins.
Also, you will get a free debit Mastercard for free withdrawals.
Perhaps it is a good option for those who are considering integrating their banking and cryptos activities, what do you think?

[javadsalehi]

I read the news and some questions came to my mind.
It is said that the wallet is a multi-signature wallet. It is also said that customers have full control of their wallets at all times.
If I am not wrong, in a multi-signature wallet, more than one key is required to access bitcoins and the customer has only one of the keys. So, how can the customer have full controls of bitcoins in a multi-signature wallet?
It is also said that customers have the private key. How can have the private key in a multi-signature wallet? If you have the private key, there is no need to bank's signature
If the customer has the private key, what if the private key is stolen from the customer? It is said that bank guarantees the bitcoin. How can they return bitcoins to the customer?

[hugeblack]

If the customer has the private key, what if the private key is stolen from the customer? It is said that the bank guarantees the bitcoin. How can they return bitcoins to the customer?

I think the guarantee relates to large amounts "deposits up to €100,000."
However, this can be done by giving the keys to more than one trusted party and signing from more than one user, for example, four keys, one at the bank, the other to the client and two to trusted independent parties or even the court. To make a transaction done you need three signatures.


Full control means that if the client does not agree, the transaction will not take place, unlike in central platforms.

[o_e_l_e_o]

It is said that bank guarantees the bitcoin. How can they return bitcoins to the customer?

It doesn't. You can read their actually press release here: https://www.bitwala.com/static/Presskit-Mobile-launch-EN-5a6840822cef599ac8e2d24686bbfef7.pdf

It says that Euro deposits up to €100,000 are protected by the German deposit guarantee scheme, as is the same for every single bank which operates in Germany. Most other western countries have similar programs. It's not a big selling point by any means. The free debit card, again, is offered by pretty much every bank in every western country. Not sure why they are making such a big deal of these basic features.

What they are offering which is new is the integration between the standard bank account and crypto trading. Their press release is actually pretty vague about this (perhaps deliberately so?), but it doesn't seem like you can actually spend your bitcoin directly via their debit card; rather, you will have to sell your bitcoin on their exchange at a 1% fee (which is a higher than most big exchanges), wait up to an hour for your bank account to be credited with fiat, and then spend the fiat.

This is perhaps an attractive option for those who don't care about their privacy and want it to be as easy as possible to trade between bitcoin and fiat, but for everyone else, there are better options out there.

[javadsalehi]

However, this can be done by giving the keys to more than one trusted party and signing from more than one user, for example, four keys, one at the bank, the other to the client and two to trusted independent parties or even the court. To make a transaction done you need three signatures.

I got it. It's same as some other multi-signature wallets like Greenaddress. But, it is also said that customers hold their own private keys.
If you have the private key, you no longer need their platform, you can easily import your bitcoin to another wallet.
The private key they are talking about might be something else and different from what we export from decentralized wallets.

you will have to sell your bitcoin on their exchange at a 1% fee (which is a higher than most big exchanges), wait up to an hour for your bank account to be credited with fiat, and then spend the fiat

They have claimed that customers hold their private keys. If it is right, using their exchange is not a must. Holding the private key make customers independent from their bank. Their announcement is a bit confusing. Seems that they don't know exactly what is private key or they have another definition for the private key.

[o_e_l_e_o]

Seems that they don't know exactly what is private key or they have another definition for the private key.

They do seem to define "key" differently to what we are used to, and are quite vague about the whole set up. I did, however, find the following snippets from their FAQs here: https://support.bitwala.com/hc/en-gb/sections/360000146580-Bitwala-wallet

Bitwala wallets are secured through a 2-out-of-3-multisignature key mechanism.

The main key and the backup key come in the form of mnemonic phrases that must be written down on paper and stored safely.

Each wallet has three keys. Of those three keys, two are required to use the wallet. The main key is generated upon choosing a wallet password in the first step of wallet creation. The resulting main key seed is only presented to the wallet creator and must be written down immediately. Afterwards, the second key, the backup key, is generated and must also be written down by the wallet creator.

The third key is the BitGo key which is generated and securely stored by BitGo. Neither Bitwala nor BitGo has access to your wallet.

So when you generate a wallet, it gives you two mnemonic phrases (which they are confusingly calling "keys"), which you are supposed to write down and back up like you would with any mnemonic phrase. The wallet is a 2-of-3, with you holding 2 keys as backed up mnemonic phrases, 1 of those 2 keys within the wallet itself when you log in, and the other key being held by them. So it is a 2-of-3 multisig between yourself and them, but at the same time, by using your 2 backed up keys you also have complete control over your coins if you wish.

You will still, then, be able to sell your bitcoin elsewhere and send the fiat to your bank account, but the big selling point of their set up seems to be that all the intermediary steps happen automatically - you sell your bitcoin directly from your wallet on their exchanges, and the fiat automatically appears in your bank account, ready to be spent. No extra transfers or waiting several days for the fiat banking system to play catch up.

[asajapheth]

Sounds like good news. The use of multi-sig wallets is what I find most interesting. It reduces the security risk. Although I'm not a fan of most centralised products, this is a fine advancement.

[BitHodler]

I'm not keen on the multi-signature part when Bitwala is as much as an authoritative signer as you are yourself. You either hold the coins yourself or don't. In this case you don't, it's that simple.

It's an artificial form of security they offer to trick people into thinking that their coins are much safer like this, which I beg to differ, especially with how vaguely they are describing the whole process behind it.

I am however curious to see how much demand there is for such a platform and the actual volume it generates. It could just as easily be something that people will ignore after the initial launch.

[arpon11]

Berlin-based crypto banking startup Bitwala has announced the launch of their bitcoin banking app for iOS and Android.
The company said that all bank accounts will be hosted by solarisBank, a licensed German bank supervised by the Federal Financial Supervisory Authority (BaFin), and deposits up to €100,000 will be protected by the German deposit guarantee scheme.
Customer Bitcoin balances, according to the company’s chief financial officer Christoph Iwaniez, are “booked directly on the Blockchain via a multi-signature wallet,” allowing customers to be “fully in control of their wallets at all times.”

Read more and source ---> https://finance.yahoo.com/news/bitcoin-bank-accounts-now-available-184131158.html
Bitwala seems to have started a good project, especially as accounts are multi-signatures, allowing users the opportunity to control their coins.
Also, you will get a free debit Mastercard for free withdrawals.
Perhaps it is a good option for those who are considering integrating their banking and cryptos activities, what do you think?

That is adoption and that is what we really want. Thant you for sharing this news with us and I just feel like be a German at the moment. Bitwala will succeed in this and one thing that l like in this Idea is bringing bitcoin into our financial system and used it to resolve or solve some financial problem we are facing through the Fiat. In a long run we would start to have cryptocurrency governments approved bank. We are getting there just like the era of the internet as one bank and governments adopt we began to see others also adopting.

[rearwheels]

My friend lives in Germany and has this bank account. She used sometimes to withdraw bitcoins from her account right to the card and btc were converted to EUR. Of course it is not anonymous but convenient way to cash out btc

[Slow death]

That is adoption and that is what we really want.

It's a good deal for the bank as long as its customers pay fees for the service the bank will be providing. At the end of the day it all came down to making money. But I'm worried about this kind of movement without clear bitcoin laws, for example in the case of Germany, to my knowledge there are no bitcoin laws in Germany yet, which means it's too early to celebrate for things like this.

My friend lives in Germany and has this bank account. She used sometimes to withdraw bitcoins from her account right to the card and btc were converted to EUR. Of course it is not anonymous but convenient way to cash out btc

Oh at least your friend has a good way to use his bitcoins in real life, even if it's indirectly (converting to local currency) ... in my case I need to use exchanges which ends up making me headaches and paying high fees

[shield132]

To be fair this doesn't amaze me, seems it's exciting when people see such features in major countries because for example in Georgia there are far better crypto services. You can buy/sell cryptocurrency via bank, (well, they charge high fees), can withdraw money via unionpay's card or visa/master card, if you pay monthly 2$, then withdrawals from most of the ATMs are free via both card.
I think this county is great in it and others have to follow it (only in crypto and blockchain techbologies, not in other things lol).