Do you trust yourself to manage your own private keys?

[Xapo]

Criticism often comes to online wallet providers (Xapo, Coinbase, etc) saying, if you don't own your private keys, you don't actually own your bitcoin. On the other hand, if your cash is in a traditional bank, you don't really own your cash either. The only possible difference, traditional banks have been around longer, and more people trust them. Many bitcoin users who criticize bitcoin vaults, store their cash in a traditional bank. Hypothetically, if Bank of America, or Barclay, or DeustcheBank announced they've invested millions into a highly protected, advanced, security architecture, would you trust someone to store it then? I personally don't trust myself to store my own bitcoin, for now. That could change in the future, but right now, I'm not a fan of the options, as the technology depends too much on my ability to maintain hardware, or, not lose something. I think about pictures, movies, files, documents, I had on my computer 10 years ago (and I always backed up), and I probably couldn't retrieve a single one without relying on a cloud-based service (Facebook, Google Drive, Dropbox, etc.). I have no idea where the original photos of my trip to Indonesia in 2008 are, but I know that album is still easily accessible on Facebook. Are critics right to say, don't use an online wallet provider, it's not safe?

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[EcuaMobi]

Other big differences why most people trust banks and not exchanges:
- Banks are controlled and regulated, BTC exchanges are not
- It's difficult and dangerous to save lots of cash at home so it makes more sense to deposit on a bank, it's not as hard to hold BTC

I completely trust myself to hold my own private keys however I would never hold a big amount of cash.

[BitcoinExchangeIndia.com]

Criticism often comes to online wallet providers (Xapo, Coinbase, etc) saying, if you don't own your private keys, you don't actually own your bitcoin. On the contrary, if your cash is in a traditional bank, you don't really own your cash either............... Are critics right to say, don't use an online wallet provider, it's not safe?

Yes. The critics are right to say so. Because one of the main reason of bitcoin's popularity is the control is back to the people. Banks can not dictate anymore. But, when an online wallet is keeping the private key with them, they are taking away the right of ownership from the people and becoming the bank of bitcoin, which is undesirable to a lot of bitcoiners.

But, yes... safety of private key is a problem at personal level as well. I think multisig implementation of bitgo, greenaddress etc. almost solves the problem...

[coinableS]

I prefer being responsible for my own keys.  Banks have too much power. We don't need a bitcoin bank that can "freeze" accounts or blacklist or place levys etc.

[croato]

Moment you invest fiat in bank you dont realy own that money and that is investment so bank pays interest on your deposit. Moment you invest Bitcoin in online wallet you dont realy own that coins anymore and online wallet pays you shit for that so i dont see how you can compare those two at all.

[Soros Shorts]

For years I've been managing PGP keys that I use to encrypt valuable and sensitive files that I can't afford to lose. The exact same techniques can be used to manage Bitcoin private keys, so it is no big deal if you are already used to it.

[jbrnt]

I trust myself with the keys more than any other online wallet. I still use online wallets because they are convenient and I do not have much coins with them.

Traditional banks are brick and mortar banks. They are just dwon the road and I know I will have support when something is wrong. Online wallets with support tickets are a different story. My deposits are safer with tradition banks than online wallet services.

[crazyearner]

I keep my keys locked away at a secure place so that if comes the time I need to recover I will recover what is needed. Or generally use paper wallets to use as offline storage for coins and keep my keys in a safe and secure place.

[AltcoinInvestor]

Yes I do. If unexperienced people start to trust bitcoin banks etc and huge amounts of btc are kept in those banks bitcoin will not be longer decentralised...

[ticoti]

If I can't trust myself who else could I trust?

You can't trust today in any third part 100% and less in the bitcoin industry

[odolvlobo]

Criticism often comes to online wallet providers (Xapo, Coinbase, etc) saying, if you don't own your private keys, you don't actually own your bitcoin. On the contrary, if your cash is in a traditional bank, you don't really own your cash either.

Both are true.

It is naive to believe that banks holding fiat are completely safe. If a bank in the U.S. fails (and they frequently do), a person that has deposited more that $250,000 in that bank will lose some of their money.

Ask the people that deposited money in banks in Iceland and Cyprus about how safe banks are.

[innocent93]

I don't trust myself because I'm not a encrypt seurcity expert, even the biggest could be hacked, I do can't trust myself, besides,  I'm an arts students, not a computer genius.

[bri912678]

Yes I do. If unexperienced people start to trust bitcoin banks etc and huge amounts of btc are kept in those banks bitcoin will not be longer decentralised...

I'd trust myself far more than a Bitcoin bank. I don't care how secure they claim to be, they can always say they were hacked and all your money's gone. If they start storing more coins than the big exchanges they will be heavily targeted by the same hackers responsible for hacking the big exchanges.

[Chef Ramsay]

These online wallets need to be secure and safe for usage because very few people, when more adoption comes, will be able to nor have the expertise to hold their own keys. Lining up their 2FA should be enough secondary encryption that can and should be trusted to keep their funds secure. Just like in any freer market, reputation and credibility should be the biggest sought after virtues of any online exchange or wallet. Staying bug free in regards to security seems to be pretty good for now in the likes of Coinbase, Blockchain, Xapo and their business models seem to have been set up to prevent inside jobs from heists. The user just needs to make sure they don't fall for phishing operations. Kinda like you don't just get a voicemail from some outfit and call back with your social security or account numbers.

[inBitweTrust]

Even the most trustworthy, secured , and insured bitcoin "banks" are vulnerable to state theft. We need to improve usability but should do so with hardware wallets and not by trusting central parties or investing in speculative bitcoin ETF's and derivatives.

Secure your bitcoins yourself securely:
https://bitcointalk.org/index.php?topic=858604.0

Do not trust your private keys with anyone.

[bri912678]

Even the most trustworthy, secured , and insured bitcoin "banks" are vulnerable to state theft. We need to improve usability but should do so with hardware wallets and not by trusting central parties or investing in speculative bitcoin ETF's and derivatives.

Secure your bitcoins yourself securely:
https://bitcointalk.org/index.php?topic=858604.0

Do not trust your private keys with anyone.

I had not considered state theft. Various states have deducted money from people's bank balances when they were in trouble. The same thing could happen to Bitcoin banks and ironically Bitcoin was partially invented to get around that problem.

[inBitweTrust]

I had not considered state theft. Various states have deducted money from people's bank balances when they were in trouble. The same thing could happen to Bitcoin banks and ironically Bitcoin was partially invented to get around that problem.

The risks extend beyond asset forfeiture, lawsuits supported by unfair legislation, and frozen accounts. States have institutionalized theft with taxes. In the USA you will have 15-40% stolen from any bitcoin gains you make. What's even more depressing about this is the fact that a significant chunk of those stolen funds are supporting unethical and corrupt policies.

[MakingMoneyHoney]

These online wallets need to be secure and safe for usage because very few people, when more adoption comes, will be able to nor have the expertise to hold their own keys. Lining up their 2FA should be enough secondary encryption that can and should be trusted to keep their funds secure. Just like in any freer market, reputation and credibility should be the biggest sought after virtues of any online exchange or wallet. Staying bug free in regards to security seems to be pretty good for now in the likes of Coinbase, Blockchain, Xapo and their business models seem to have been set up to prevent inside jobs from heists. The user just needs to make sure they don't fall for phishing operations. Kinda like you don't just get a voicemail from some outfit and call back with your social security or account numbers.

But those online companies have GOT to get their acts together.

This explains how people could bypass 2FA with those sites using AUTHY up until about a month ago: http://sakurity.com/blog/2015/03/15/authy_bypass.html/

And then there's always social engineering (people calling up and saying they lost their phone):

http://www.theverge.com/a/anatomy-of-a-hack

[Alley]

I go back and forth.  I use paper wallets but always get nervous that everything worked.  And I can't test the private key without defeating the purpose of cold storage.  But let's say coinbase gets hacked and you loose all your coins.  On the other hand at this point in the game if a exchange like that goes down the price is going to plummet and your coins will be near worthless anyway.

[DannyHamilton]

Criticism often comes to online wallet providers (Xapo, Coinbase, etc) saying, if you don't own your private keys, you don't actually own your bitcoin.

That's not criticism, that's just the reality of the situation.

On the contrary, if your cash is in a traditional bank, you don't really own your cash either.

How is that "on the contrary"?  You're saying the same thing about both. I don't think that phrase means what you think it means.

The only possible difference, traditional banks have been around longer, and more people trust them.

That's the "only possible difference"?  Really?  There aren't any other possible differences?

Do they both operate under the same government regulations?
Are your deposits insured in both by the Federal Deposit Insurance Corporation (or some other equivalent insurance underwriter)?
Are they both held to the same financial audits?

Many bitcoin users who criticize bitcoin vaults, store their cash in a traditional bank.

Some do.  Some don't.  So what?

Hypothetically, if Bank of America, or Barclay, or DeustcheBank announced they've invested millions into a highly protected, advanced, security architecture, would you trust someone to store it then?

That would depend on the specifics of the situation, but probably not.

Are critics right to say, don't use an online wallet provider, it's not safe?

Yes.

[zcxvbs]

The security is the major issues of Bitcoin usage, just heard coinapult hot wallet got hacked and lost 150BTC, so if you own a great amount of Bicoin, you'd better hiring professional Bitcoiner to manage your private key.

[inBitweTrust]

I go back and forth.  I use paper wallets but always get nervous that everything worked.  And I can't test the private key without defeating the purpose of cold storage.  But let's say coinbase gets hacked and you loose all your coins.  On the other hand at this point in the game if a exchange like that goes down the price is going to plummet and your coins will be near worthless anyway.

It isn't that hard to properly secure your keys with paperwallets or hardware wallets but you do bring up a good point concerning doubt. The average user won't feel confident enough to secure their bitcoins themselves unless we improve the usability experience a bit.

The security is the major issues of Bitcoin usage, just heard coinapult hot wallet got hacked and lost 150BTC, so if you own a great amount of Bicoin, you'd better hiring professional Bitcoiner to manage your private key.

No, you should hire a security expert to help you secure your private keys yourself. I have one of these coming in the mail  -
https://mycelium.com/entropy

As of which I plan to have monthly meetings where I allow anyone in the public free of charge to print off a multi-sig paper wallet on a dumb printer with wifi disabled and without me viewing their private keys. I will continue to give out free advice and consult people on best security practices for the good of the ecosystem.

[Kprawn]

I think this is one of the reasons why I started using Bitcoin. The freedom to control your own money and not having to rely on any centralized organization to do it for you.

You bring up a valid argument, because there are people who are not savy enough to do this, but they do have the option to use these online wallet providers, with full control over your keys.

I just cannot see why people cannot just print out a paper wallet and laminate and store it in a safe place? This takes 10 minutes. 

I still choose to have this freedom and control over my own financial destiny.   

[Gisado]

Well, bitcoin online wallets and bank are not same - btc wallets are not a real bank and they don't get an audit like a bank.

So, I'd prefer and trust myself to store my private key by myself. That's why I started using bitcoin!

[Hazir]

Op, don't take power of choice from peoples hands. They have right to choose their wallets. So You like to have your coins stored online, it is your way of doing things that is fine. I personally never trust anything cloud related to keep my stuff. I prefer local wallets. And I am sure that this is the most safe way of keeping your bitcoins.

[Josef27]

if you don't own your private keys, you don't actually own your bitcoin. On the contrary, if your cash is in a traditional bank, you don't really own your cash either.

Bitcoin, in my opinion, already act like bank, so I wouldn't need another "bank" for bitcoin.

[zetaray]

I don't manage my private keys. I let electrum take care of those and I manage my own secret seed. Only 12 words to remember or to keep safe. An easy task for most bitcoiners.

[Joca97]

yes i trust my self more then the site!

for example i hate coinbase because they wont give me my private key and there is no way to get it

but i love blockchain.info because from them i can get easy my private key!!

[Agestorzrxx]

I only trust myself  to control my private key. you can't give your coins to others to save it. The regular is not maturity at this moment.

[R2D221]

I just cannot see why people cannot just print out a paper wallet and laminate and store it in a safe place? This takes 10 minutes.

It takes you 10 minutes, but ask my mother set up a paper wallet, and she will be lost. Truth is, paper wallets are not as easy to use for the common people.

[Krang]

IF you can't trust yourself to keep a hold of your own money safely then maybe bitcoin isn't for you. I'd also be very weary of what external sites you use because when you do you are putting your faith and trust in them 100%. If you're not willing to do this I would suggest not using these sites and look for other or decentralized options.

[chmod755]

I do trust myself to manage my own private keys, but I'm aware that I could get hacked or make a fatal mistake and that's why I keep 40% of my Bitcoins in managed wallets by different companies.

If you're managing all your bitcoins on your own you have a single point of failure.

[R2D221]

IF you can't trust yourself to keep a hold of your own money safely then maybe bitcoin isn't for you.

Right now. But if we plan Bitcoin to be a world currency, we need to have apps and services that are easy and secure to use for everyone. (and yes, some of them will need trust)

[R2D221]

I currently have a Ledger Wallet, and I'm storing all my bitcoins there (not many, but yes). If they are to be trusted, then my private keys are unhackable, and if I ever lose it or forget my PIN, then I have my recovery 24-word seed.

[matt4054]

I do trust myself to manage my own private keys, but I'm aware that I could get hacked or make a fatal mistake and that's why I keep 40% of my Bitcoins in managed wallets by different companies.

Well as long as your nickname is not related to your wallet.dat I guess you're safe...

Seriously, I think it's safer not to put all eggs in one basket indeed, but current 'companies' don't offer security levels anywhere near commercial banks, except *maybe* for companies like Fidor Bank AG, but there are so few aiming at that level...

In the meantime I feel safer owning *all* of my private keys. At this (early) stage, If I die, they'll die with me, and I'm ok with that. I only have a few coins right now so it's no big deal, when I had much more one year ago, I used to keep most of them in a cold (paper) wallet, and the only copy of the private key was kept in a separate physical location by a friend that I could trust 100%.

[countryfree]

Yes, I trust myself. I suggest that those who don't wear diapers. You never know what may happen.

[Madness]

Of course I do , I mean .. who wouldn't ?
I prefer managing my own private keys then giving them to an Online wallet providers to control them . and .. at least least if I lose them I will be responsable for my actions and my mistakes . but if those online Wallet providers gets hacked .. well you can't blame anyone but them .

~ Madness

[foxkyu]

of course i am trust myself
private key will always safe by me, because i never share it to anyone else
if i can't trust myself, then nobody will trust me

[Kakmakr]

I do not trust myself when I have had a few beers ^Hic^
There are a few scenario's where I would rather have someone else have my private keys ^Smile^
For the people with [Alzheimer light] like my Grandmother ^Heh^

[Q7]

I think what draws the borderline here between banks and bitcoin vaults is mainly the regulations and the systems. Regulations because even though banks basically have their own way, they are still tied up to some form of control by governments. That depends on countries to countries. And plus, central banks can sometimes bail the same banks out to avoid total catastrophe. Bitcoins don't have that for sure. And on the systems, banks also have auditors to determine their stability and ratings so that's also another difference.

[Xapo]

The security is the major issues of Bitcoin usage, just heard coinapult hot wallet got hacked and lost 150BTC, so if you own a great amount of Bicoin, you'd better hiring professional Bitcoiner to manage your private key.

Hot wallet hacks will continue. It happened to bitstamp, it happened to Coinapult, and could happen to anyone, even with the best security experts. 150BTC is extremely minor, just like how Bitstamps hack was considered minor by them (they absorbed the damage, and no one lost a cent). Do you realize how much Visa/Mastercard lose to fraud on a daily basis? A good company will factor this into operational costs.

[shogdite]

You've only got to look at the last bailouts (eg. Iceland, UK, US) to know that storing fiat in a bank is not without risk. You may be 'protected' up to a certain amount but you still have to put a lot of trust into these centralized institutions.

I completely trust myself to look after my private keys, if anything thing happens to them it's my fault and noone elses. Zero red tape and zero regulation, if I lose them I don't expect to be bailed out by other peoples taxes.

[Xapo]

I just cannot see why people cannot just print out a paper wallet and laminate and store it in a safe place? This takes 10 minutes. 

I still choose to have this freedom and control over my own financial destiny.   

You absolutely can, but what is safe? A safety deposit box is the only truly safe place I can think of. Maybe you keep it in your safe at home? But then you move, like my father did, and his truck burst into flames on the side of the highway and he lost all his personal belongings. You have to assume that that laminated piece of paper would have been one of the things lost in the fire had he been a bitcoin guy. If you tell me to make a fireproof, private key, you're missing the point. All I'm saying is, I move every 2 years or so, and it scares me thinking to think that I need to be responsible for any single piece of property. With the exception of a ring (which recently broke, is sitting in a drawer at my mothers house, and currently at risk of being "tossed out") and a guitar, I don't have anything that is more than 10 years old. Things get lost. Things get out dated. Mothers throw things out. Especially tiny pieces of paper with 64 random digits on it.

[inBitweTrust]

You absolutely can, but what is safe? A safety deposit box is the only truly safe place I can think of. Maybe you keep it in your safe at home? But then you move, like my father did, and his truck burst into flames on the side of the highway and he lost all his personal belongings. You have to assume that that laminated piece of paper would have been one of the things lost in the fire had he been a bitcoin guy. If you tell me to make a fireproof, private key, you're missing the point. All I'm saying is, I move every 2 years or so, and it scares me thinking to think that I need to be responsible for any single piece of property. With the exception of a ring (which recently broke, is sitting in a drawer at my mothers house, and currently at risk of being "tossed out") and a guitar, I don't have anything that is more than 10 years old. Things get lost. Things get out dated. Mothers throw things out. Especially tiny pieces of paper with 64 random digits on it.

Multisig laminated paper wallets solve all these concerns. Or a hardware wallet with BIP 32 backed up in several locations(not as secure as using multisig but very secure).

One of the most secure methods of cold storage is to take create a multisig 2 of 3 paper wallet (This makes it easy- https://mycelium.com/entropy), add one of the keys to an encrypted password manager and destroy the physical representation, laminate the remaining 2 keys or engrave them on steel and hide one in your home or place in your fireproof safe, and the last key can be laminated and placed in an offsite relatives home, bank safety deposit box, or time capsule. This allows for an extremely high level of security and protection against user error or mistakes with a fairly easy way of retrieving your assets within a couple minutes if needed.

The average user can simply use a hardware wallet and backup it with BIP 32  and place that in a safe. People with larger savings that aren't technical can always hire a professional security consultant.  

[MCHouston]

I trust myself.  After all my daily job is a Network Security Engineer, I think I will manage my own private keys.

[NeuroticFish]

Right now I keep the keys. It's the only safe way right now.

If ever this area will get regulated and insured, I may switch to 3rd party, because my wife and children don't have to be tech oriented to get the benefit.
Right now, if something happens to my brain, the coins will be lost.

[DeboraMeeks]

Keys ain't a problem keeping, the problem is storing them at a right/safe place.
I have seen viruses on PCs which steal them and the other day, you won't see your Bitcoins in your account just because you don't have some highly trusted Anti-Virus installed.

Storing them offline seems more secure to me than keeping them online with so many coins stored in a single key.

[blablaace]

this is a STUPID post from Xapo .. of course most people on bitcointalk trust themselves to manage their own private keys. Xapo and CoinBase are going after bitcoin newbies, not veteran users

[BitUsher]

I agree with most people that they should secure the bitcoins themselves or at minimum only use banks that can prove they aren't the ultimate custodians of the keys through multisig or other methods.

[neurotypical]

Criticism often comes to online wallet providers (Xapo, Coinbase, etc) saying, if you don't own your private keys, you don't actually own your bitcoin. On the other hand, if your cash is in a traditional bank, you don't really own your cash either. The only possible difference, traditional banks have been around longer, and more people trust them. Many bitcoin users who criticize bitcoin vaults, store their cash in a traditional bank. Hypothetically, if Bank of America, or Barclay, or DeustcheBank announced they've invested millions into a highly protected, advanced, security architecture, would you trust someone to store it then? I personally don't trust myself to store my own bitcoin, for now. That could change in the future, but right now, I'm not a fan of the options, as the technology depends too much on my ability to maintain hardware, or, not lose something. I think about pictures, movies, files, documents, I had on my computer 10 years ago (and I always backed up), and I probably couldn't retrieve a single one without relying on a cloud-based service (Facebook, Google Drive, Dropbox, etc.). I have no idea where the original photos of my trip to Indonesia in 2008 are, but I know that album is still easily accessible on Facebook. Are critics right to say, don't use an online wallet provider, it's not safe?

I think there is a legit market for "bitcoin banks" specially if you can make interest out of your holdings, but a lot of people are into bitcoin precisely because they want to be their own bank, but yeah you can fuck up big time if you lose your wallet.

[Trance]

Of course, why would one not trust themselves!!

[Nude]

I only trust myself to manage my private keys.

[Karartma1]

Do you trust yourself to manage your own private keys?

Yes, of course. Why wouldn't I?

Criticism often comes to online wallet providers (Xapo, Coinbase, etc) saying, if you don't own your private keys, you don't actually own your bitcoin. On the other hand, if your cash is in a traditional bank, you don't really own your cash either.

They are both true. I don't trust any online service to keep my funds. I don't trust banks. You know governments have ability to freeze your bank account, and take all of your money.

I think about pictures, movies, files, documents, I had on my computer 10 years ago (and I always backed up), and I probably couldn't retrieve a single one without relying on a cloud-based service (Facebook, Google Drive, Dropbox, etc.). I have no idea where the original photos of my trip to Indonesia in 2008 are, but I know that album is still easily accessible on Facebook.

Cloud services, are you serious? Privacy = 0
I never use cloud services. Do you like it if some random people view your photos just because they want and can?
I rarely upload a photo of me on the internet. I don't want to keep any of my files in cloud services or random sites.

Are critics right to say, don't use an online wallet provider, it's not safe?

They are not safe enough to keep all your funds, but they are useful if you will use small amounts or use them in short time.

[EcuaMobi]

Of course, why would one not trust themselves!!

Of course the question doesn't mean "do you trust you won't steal coin from yourself?", it means "do you think your tech-savvy enough to take all the security measures to keep your coins safe?".
So that's why some people could not trust themselves. I do as I posted earlier but of course a lot of people don't have the required knowledge to do it.
I hope this will change in the future, it's a requirement to get mass adoption while keeping the objective of bitcoin.

[jjacob]

Criticism often comes to online wallet providers (Xapo, Coinbase, etc) saying, if you don't own your private keys, you don't actually own your bitcoin. On the other hand, if your cash is in a traditional bank, you don't really own your cash either. The only possible difference, traditional banks have been around longer, and more people trust them.

The reason why I store money in a bank is that
(i) I earn interest on my deposits
(ii) Even in case the bank goes bust, my deposit (up to a certain amount) is insured.

With Bitcoins, I would rather secure my private key on my own.

[bitllionaire]

Who can manage your keys better than you?

that way you can exactly know the risks you are taking and you can know how safe are your coins.

If you don't keep your coins safe it would your fault and nobody else

[Hazir]

I like how from Op's post I can feel that he thinks: people are little retarded and stupid and it would be better for them if they keep all theirs private keys and money in online storage. That way people would be 'free' from thinking about all that unnecessary stuff like 'how to secure my bitcoins'. After all someone can do this better for them...

[EcuaMobi]

I like how from Op's post I can feel that he thinks: people are little retarded and stupid and it would be better for them if they keep all theirs private keys and money in online storage. That way people would be 'free' from thinking about all that unnecessary stuff like 'how to secure my bitcoins'. After all someone can do this better for them...

The thing is people don't need to be retarded not to be able to handle their own private keys. They just need not be informed enough.

I'm sure (almost?) everyone on this forum are able to correctly handle their own keys but unfortunately that's not the case for most people outside.

[OpenOcean]

1st) If you can't trust yourself to secure your own assets, you will never be rich and don't deserve to be. Get out of the space now, and wait for the inventors and entrepreneurs to create technology to suit your needs, then come back when all the hard work is done and the right people have been rewarded.

2nd) Hardware wallets are coming out for this exact purpose. So if you do decide that you want to take responsibility for your wealth, use a notebook (or two) to log your private and public key information and hold your stuff in cold storage like the rest of us. Just because it's tedious does not mean it's rocket science.

[BitBOOM]

Not 100% but I wouldn't have it any other way. I've made a couple mistakes that cost me coin over the last couple years. Live and learn

[X7]

This is kinda the point of be your own bank.. with the hardware wallets that exist now a days.. no excuses

[Gimpeline]

None of the banks you listed are secure. Just look at Cyprus where the money was stolen by the goverment from the "secure" banks.
I rather be my own bank than have my money in a place where it can be stolen that easy just as I would never trust any of those programs you listed with anything that has value for me.

[sandy47bt]

I better manage my bitcoin by myself than i leave it at someone who can't give my private key / privacy

But, if it's about fiat. I better manage my fiat money at bank since i could get interest rate

[madmat]

I trust myself. I use electrum, so the only thing i have to secure is 12 words. They are in my head and written down partially on different hidden papers. The only scenarios where i could lose my coins is if i die or can't remember anything.

[Orangina]

Most of people that use bitcoin are against bank systems so I think the majority can manage private key on his own.
Also the banks aren't that secure !

[SueGiant]

I will not steal coins that I own. 

[hugs1BTC]

I took a while to study everything but now I can say I trust myself 100%.

[shogdite]

I took a while to study everything but now I can say I trust myself 100%.

There is a learning curve when it comes to being in control of your own wealth, problem being most of us are used to having other people (banks etc) look after it for us.
All we have to do is convince more people of the financial freedom bitcoin provides.

[Xapo]

I like how from Op's post I can feel that he thinks: people are little retarded and stupid and it would be better for them if they keep all theirs private keys and money in online storage. That way people would be 'free' from thinking about all that unnecessary stuff like 'how to secure my bitcoins'. After all someone can do this better for them...

The thing is people don't need to be retarded not to be able to handle their own private keys. They just need not be informed enough.

I'm sure (almost?) everyone on this forum are able to correctly handle their own keys but unfortunately that's not the case for most people outside.

That's true. To be honest, the results of the poll surprised me a little. I'm obviously technical (I work for Xapo), and could quite easily move my coins to mycelium (the wallet I've determined after researching, is best for those who want control of their private keys), but I think because I work here, and know the company's history, investors, dedication to security, insurance policy, and existing customers (much richer, with MUCH more to lose if anything happened to the security architecture than I do), I think the likelihood of something happening with my hardware, or paper wallet is simply more. I don't expect people to share my view on this, especially considering the libertarian, self-governing attitudes of many early bitcoin adopters. Yes, I could bury my private keys in some strategic location, but IF you trust a bitcoin bank, it's obviously easier, and I do. I would trust any company that uses deep cold storage of their private keys and has valid insurance, not just Xapo necessarily, but I know our security team personally, and they're a lot smarter than I am.

[seoincorporation]

Criticism often comes to online wallet providers (Xapo, Coinbase, etc) saying, if you don't own your private keys, you don't actually own your bitcoin. On the other hand....

If you dont have the private keys, maybe the wallet service own and manage your private keys, the problem is if you want to change your wallet but keep your addys, that will not be possible because you don't have your private keys.

At last who have the privatekeys have the addys, if you trust them is on, but any time you want they can do what they want with your btc because they own your addys.

[R2D221]

Criticism often comes to online wallet providers (Xapo, Coinbase, etc) saying, if you don't own your private keys, you don't actually own your bitcoin. On the other hand....

If you dont have the private keys, maybe the wallet service own and manage your private keys, the problem is if you want to change your wallet but keep your addys, that will not be possible because you don't have your private keys.

At last who have the privatekeys have the addys, if you trust them is on, but any time you want they can do what they want with your btc because they own your addys.

Why is this relevant? You shouldn't be reusing addresses anyway.

[Muhammed Zakir]

Why is this relevant? You shouldn't be reusing addresses anyway.

Reusing address(es) is a privacy problem and also it may expose your private key due to reused R values. Overall, it isn't wrong to reuse address but using address in a buggy client usually isn't a good idea.

[AtheistAKASaneBrain]

Why is this relevant? You shouldn't be reusing addresses anyway.

Reusing address(es) is a privacy problem and also it may expose your private key due to reused R values. Overall, it isn't wrong to reuse address but using address in a buggy client usually isn't a good idea.

Is it a problem to recieve payments as well? How are you supposed to not repeat your address for example if you are in a sig campaing? gotta be the same always.

[redsn0w]

Why is this relevant? You shouldn't be reusing addresses anyway.

Reusing address(es) is a privacy problem and also it may expose your private key due to reused R values. Overall, it isn't wrong to reuse address but using address in a buggy client usually isn't a good idea.

Is it a problem to recieve payments as well? How are you supposed to not repeat your address for example if you are in a sig campaing? gotta be the same always.

The better thing (in my opinion) is to use a new address each transaction, if someone knows your private key "owns" your bitcoin. It is a "strange" concept but it is normal. The best thing as I said is to use a new bitcoin address every transaction and after collect them in a wallet.

[madmat]

Why is this relevant? You shouldn't be reusing addresses anyway.

Reusing address(es) is a privacy problem and also it may expose your private key due to reused R values. Overall, it isn't wrong to reuse address but using address in a buggy client usually isn't a good idea.

Is it a problem to recieve payments as well? How are you supposed to not repeat your address for example if you are in a sig campaing? gotta be the same always.

It's no security issue to reuse for receiving money

There is no security issue to reuse even if you send money from an address. Quantuum computers do not exist !!!! The only issue with reusing is privacy.

[BillyBobZorton]

Why is this relevant? You shouldn't be reusing addresses anyway.

Reusing address(es) is a privacy problem and also it may expose your private key due to reused R values. Overall, it isn't wrong to reuse address but using address in a buggy client usually isn't a good idea.

Is it a problem to recieve payments as well? How are you supposed to not repeat your address for example if you are in a sig campaing? gotta be the same always.

It's no security issue to reuse for receiving money

There is no security issue to reuse even if you send money from an address. Quantuum computers do not exist !!!! The only issue with reusing is privacy.

Oh I get it now, so you can freely use the same account, people just do it to not be traceable on the blockchain I guess.

[redsn0w]

Why is this relevant? You shouldn't be reusing addresses anyway.

Reusing address(es) is a privacy problem and also it may expose your private key due to reused R values. Overall, it isn't wrong to reuse address but using address in a buggy client usually isn't a good idea.

Is it a problem to recieve payments as well? How are you supposed to not repeat your address for example if you are in a sig campaing? gotta be the same always.

It's no security issue to reuse for receiving money

There is no security issue to reuse even if you send money from an address. Quantuum computers do not exist !!!! The only issue with reusing is privacy.

Oh I get it now, so you can freely use the same account, people just do it to not be traceable on the blockchain I guess.

Did you mean address? Yes you can use your bitcoin address many times as you want the problem of the privacy is when you "link" your address to your forum account or your real identity.

[madmat]

Why is this relevant? You shouldn't be reusing addresses anyway.

Reusing address(es) is a privacy problem and also it may expose your private key due to reused R values. Overall, it isn't wrong to reuse address but using address in a buggy client usually isn't a good idea.

Is it a problem to recieve payments as well? How are you supposed to not repeat your address for example if you are in a sig campaing? gotta be the same always.

It's no security issue to reuse for receiving money

There is no security issue to reuse even if you send money from an address. Quantuum computers do not exist !!!! The only issue with reusing is privacy.

Oh I get it now, so you can freely use the same account, people just do it to not be traceable on the blockchain I guess.

There is a security issue if you send BTC and use a weak RNG

So reuse to receive is ok
Reuse to send is not so good and can be a security issue, as we have seen with the android RNG bug that resulted in bitcoin theft for people reusing addresses to send from android

All that is true, but security issue is linked to bad RNG, no problem with a good wallet. HD wallets are great as they give you a new address for each transaction and you only need to backup 12 or 24 words.

[thejaytiesto]

I may really look into Xapo. I know that feel of lossing a lot of documents over the years. Human error is unavoidable, lossing your wallet.dat could be fatal.

[Klestin]

Trezor + split paper wallet.  Easy peasy.

[iGotSpots]

That's like asking if you can handle knowing your own PIN for a debit card

[Xapo]

Why is this relevant? You shouldn't be reusing addresses anyway.

Reusing address(es) is a privacy problem and also it may expose your private key due to reused R values. Overall, it isn't wrong to reuse address but using address in a buggy client usually isn't a good idea.

Is it a problem to recieve payments as well? How are you supposed to not repeat your address for example if you are in a sig campaing? gotta be the same always.

It's no security issue to reuse for receiving money

There is no security issue to reuse even if you send money from an address. Quantuum computers do not exist !!!! The only issue with reusing is privacy.

Oh I get it now, so you can freely use the same account, people just do it to not be traceable on the blockchain I guess.

There is a security issue if you send BTC and use a weak RNG

So reuse to receive is ok
Reuse to send is not so good and can be a security issue, as we have seen with the android RNG bug that resulted in bitcoin theft for people reusing addresses to send from android

All that is true, but security issue is linked to bad RNG, no problem with a good wallet. HD wallets are great as they give you a new address for each transaction and you only need to backup 12 or 24 words.

By the way, Xapo also generates a new wallet address for each transaction.

[Xapo]

Xapo's SVP of Legal & Strategy just wrote an entire blog on the topic of investors holding their own private keys:

"Using storage techniques like paper wallets or printed key back-ups, as required by certain storage solutions, is akin to managing a large swath of physical cash."

You can read the whole thing here: https://twitter.com/xapo/status/578634435345690624

[Gimpeline]

Why is this relevant? You shouldn't be reusing addresses anyway.

Reusing address(es) is a privacy problem and also it may expose your private key due to reused R values. Overall, it isn't wrong to reuse address but using address in a buggy client usually isn't a good idea.

Is it a problem to recieve payments as well? How are you supposed to not repeat your address for example if you are in a sig campaing? gotta be the same always.

It's no security issue to reuse for receiving money

There is no security issue to reuse even if you send money from an address. Quantuum computers do not exist !!!! The only issue with reusing is privacy.

Oh I get it now, so you can freely use the same account, people just do it to not be traceable on the blockchain I guess.

There is a security issue if you send BTC and use a weak RNG

So reuse to receive is ok
Reuse to send is not so good and can be a security issue, as we have seen with the android RNG bug that resulted in bitcoin theft for people reusing addresses to send from android

All that is true, but security issue is linked to bad RNG, no problem with a good wallet. HD wallets are great as they give you a new address for each transaction and you only need to backup 12 or 24 words.

By the way, Xapo also generates a new wallet address for each transaction.

Yeah but since you comply with the US laws. Know your customer and all that crap it dosn't really matter if it is a new adress or not. your account is tracked no matter how many adresses you use. And if the law decided that you did a no-no you are screwed since you didn't keep your private key private. Not exactly what I call security.

[Kim Dotnet]

I think that manage private keys on my own is the best solution to make my money safe , also bitcoin make you far away from banks you don't need any bank service !

[nachoig]

That's the "only possible difference"?  Really?  There aren't any other possible differences?

Do they both operate under the same government regulations?
Are your deposits insured in both by the Federal Deposit Insurance Corporation (or some other equivalent insurance underwriter)?
Are they both held to the same financial audits?

Not every country has deposit insurance or serious audits, and also, deposit insurance schemes has limits. And in some cases, I think deposit insurance isn't sufficient if a too big bank fails.

Criticism often comes to online wallet providers (Xapo, Coinbase, etc) saying, if you don't own your private keys, you don't actually own your bitcoin. On the other hand, if your cash is in a traditional bank, you don't really own your cash either. The only possible difference, traditional banks have been around longer, and more people trust them. Many bitcoin users who criticize bitcoin vaults, store their cash in a traditional bank. Hypothetically, if Bank of America, or Barclay, or DeustcheBank announced they've invested millions into a highly protected, advanced, security architecture, would you trust someone to store it then? I personally don't trust myself to store my own bitcoin, for now. That could change in the future, but right now, I'm not a fan of the options, as the technology depends too much on my ability to maintain hardware, or, not lose something. I think about pictures, movies, files, documents, I had on my computer 10 years ago (and I always backed up), and I probably couldn't retrieve a single one without relying on a cloud-based service (Facebook, Google Drive, Dropbox, etc.). I have no idea where the original photos of my trip to Indonesia in 2008 are, but I know that album is still easily accessible on Facebook. Are critics right to say, don't use an online wallet provider, it's not safe?

This is true, but securing physical cash in some places of the world is really hard. I can't go to the street (in my case, a big city in Brazil) with an amount equivalent to 1 BTC without suffering a serious risk of being robbed with a fire gun, by the way, a lot of assaults here occurs just after you go to the bank and withdraw some cash (known here as "saidinha bancária", or "bank exit"). In these last 2 days I also exchanged some US dollars which I had at my home for Brazilian Reals, but immediatelly after exchanging it, I deposited the reals at my bank account, because:

1. I didn't want to take the risk of being back to home after exchanging money, even doing this through a legal exchange.
2. With the devaluation of Brazilian Real against the US dollar (now it's 3.29 BRL per USD, against 2.32 BRL per USD one year ago), the excess of banknotes was damaging my wallet and eventually could lead the attention of other people.

Personally I don't trust in my bank at all, specially because I don't trust in fractional reserves, but I think in mycase is just the lack of other alternatives. Also, a lot of people and business still use banks for payments, so I still need a bank account to receive these payments.

OTOH, the idea behind Bitcoin is to bring to you the control of your money, specially on its eletronic form. So, if you go to a Bitcoin bank, you bring to the bank the control of your money, in the same as it happens at fiat money. So, why Bitcoin?

[countryfree]

So what's the choice?
Should I trust myself, or should I trust some unknown service, in some foreign country?

I've chosen to trust myself.

[Slaxt]

So what's the choice?
Should I trust myself, or should I trust some unknown service, in some foreign country?

I've chosen to trust myself.

And you would be a winner at least whatever happens you only have your self to blame if you do something wrong or lack on security and it gets stolen. I trust myself 100% just as i do with all my finances they will hopefully always be in my control so no nasty surprises come my way.

[asuryan180]

The option trusting Bitcoin banks would be suicide i can imagine them now trading away loaning out at interest they will just pick up where the fiat banks left of. The thing it is good to be in full control of your private keys and i believe if you don't hold them then you don't have anything plus you are your own bank like it should be and for you to keep up to date with insuring the security of your computer is up to scratch, it would be easier have someone else hold it but that someone is not insured and until they are i will hold my coins private keys.

[DannyHamilton]

Not every country has deposit insurance or serious audits,

Certainly, and if I lived in one of those countries I wouldn't deposit my local currency into a bank.

and also, deposit insurance schemes has limits.

Yes, it does.  And intelligent people are aware of those limits and make intelligent decisions about how to protect their assets.

And in some cases, I think deposit insurance isn't sufficient if a too big bank fails.

This has never been true in the United States.  Are you aware of any examples of specific situations anywhere globally where an in insured deposit wasn't covered due to the bank being "too big"?

[randy8777]

i would never trust a "bitcoin bank" with any of my funds. i fully trust myself into managing my private keys thus my funds.
there is a saying : with bitcoin you have a bank in your pocket. my pocket. and that's how i like it.

[nachoig]

Not every country has deposit insurance or serious audits,

Certainly, and if I lived in one of those countries I wouldn't deposit my local currency into a bank.

and also, deposit insurance schemes has limits.

Yes, it does.  And intelligent people are aware of those limits and make intelligent decisions about how to protect their assets.

The problem here goes beyond an individual. What happens if you are a business?

And in some cases, I think deposit insurance isn't sufficient if a too big bank fails.

This has never been true in the United States.  Are you aware of any examples of specific situations anywhere globally where an in insured deposit wasn't covered due to the bank being "too big"?

I don't know any case, this is more an speculation. What I know from where I live, in Brazil we have the Fundo Garantidor de Créditos (FGC) (by the way, unlike other deposit insurance systems, FGC is private-owned, but it works more like as a parastatal entity). The FGC has assets in about 35 billion Brazilian Reals. But it covers more than 800 billion Brazilian Real in bank deposits, so if some of the biggest banks fails, probably FGC will fail too. I remember I had seen an interview with someone from FGC addimiting this, but I didn't found the link now. It seems the idea behind FGC is more likely to avoid a contamination crysis caused by fails from small and medium banks strike the biggest ones. Also, its intervention on two medium-seize banks caused a lot of controverse and there are serious accusations of fraud in these interventions (in Portuguese).

http://exame.abril.com.br/revista-exame/edicoes/1026/noticias/salvar-ou-deixar-quebrar
http://epoca.globo.com/tempo/noticia/2013/08/o-novo-escandalo-na-bancarrota-do-banco-cruzeiro-do-sul.html

Edit: Google Translator links:
https://translate.google.com.br/translate?sl=pt&tl=en&js=y&prev=_t&hl=pt-BR&ie=UTF-8&u=http%3A%2F%2Fexame.abril.com.br%2Frevista-exame%2Fedicoes%2F1026%2Fnoticias%2Fsalvar-ou-deixar-quebrar&edit-text=&act=url
https://translate.google.com.br/translate?sl=pt&tl=en&js=y&prev=_t&hl=pt-BR&ie=UTF-8&u=http%3A%2F%2Fepoca.globo.com%2Ftempo%2Fnoticia%2F2013%2F08%2Fo-novo-escandalo-na-bancarrota-do-banco-cruzeiro-do-sul.html&edit-text=&act=url

[yeponlyone]

Trezor + split paper wallet.  Easy peasy.

Trezor is much more expensive than generating a secure paper wallet. In most circumstances, a paper wallet would work just fine.

[redsn0w]

i would never trust a "bitcoin bank" with any of my funds. i fully trust myself into managing my private keys thus my funds.
there is a saying : with bitcoin you have a bank in your pocket. my pocket. and that's how i like it.

Bitcoin bank is an useless thing and especially not compatible with the bitcoin ideology. I have read in a lot of site "be your own bank" because a wallet unders some circumstances is considered your own bank, so it's not necessary a real bank with a lot of bitcoin (it will be a good target for malicious user).

[inBitweTrust]

Irrational fear mongering.

https://blog.xapo.com/the-risk-of-holding-your-investors-private-keys/

Centralized companies are a security risk.

Assuming they do store their clients bitcoins securely in multisig cold storage like we can also easily do.

These are the risks that you are exposed to:

1) Inside theft from employees colluding together
2) Company creating a fractional reserve and loaning out more than their reserves between audits or colluding with auditor.
3) Tax theft
4) Liability of lawsuits against Xapo or against client freezing ones assets
5) Unnecessary fees and charges to pay for security, audits, and insurance
6) centralized target for outside hackers to gravitate towards
7) Loss of privacy if Xapo monetizes your personal data and/or shares data with governments

Bitcoin is decentralized Peer to Peer cash and banking. Some people really need to read and understand the intentions and design principles of Bitcoin.
Start with the whitepaper:

https://bitcoin.org/bitcoin.pdf

Bitcoin: A Peer-to-Peer Electronic Cash System

[luv2drnkbr]

No but I trust everybody else less.  (I answered "Yes 100%" to the survey because that was the closest.)

[AtheistAKASaneBrain]

No but I trust everybody else less.  (I answered "Yes 100%" to the survey because that was the closest.)

Truuu, but I would trust someone that is professional about storage, regardless if you trust yourself a lot, because human error is unavoidable.

[madmat]

No but I trust everybody else less.  (I answered "Yes 100%" to the survey because that was the closest.)

Truuu, but I would trust someone that is professional about storage, regardless if you trust yourself a lot, because human error is unavoidable.

Best idea is to pay someone who can teach you how to secure your keys by yourself, so you will know he can't steal you

This guy is a professional about  storage. I prefer to trust myself.

[Amph]

obviously yes, bitcoin is born to make people like us , who like to be self-bank, more prominent

i fly low, just 3 usb stick with wallet.dat as backup some on the exchange and the rest on the client, i'm still unsure if i should create others wallet...

[Lauda]

Well looking at all the currently available possibilities of storing them, yes. Trusting someone else with the keys makes Bitcoin somehow lose its point.
Actually if you don't own the private keys, you don't really own the Bitcoins on that address. I'm saying this because of the exchanges and online wallets. Keeping coins there is a bad idea, just as trusting someone with keys is.

[fsb4000]

Yes, 100%, and I always will.
 

[abyrnes81]

Well looking at all the currently available possibilities of storing them, yes. Trusting someone else with the keys makes Bitcoin somehow lose its point.
Actually if you don't own the private keys, you don't really own the Bitcoins on that address. I'm saying this because of the exchanges and online wallets. Keeping coins there is a bad idea, just as trusting someone with keys is.

Do you know there are a lot of people are keeping their bitcoins (or altcoins) on the various exchange? After crying because the exchange was hacked. This thread is very , very useless ( I think no one should trust another person to manage your private keys, that's broke all the bitcoin concept).

[1Referee]

I don't see why not. I'm doing it already with success and will continue doing so 

I already stopped leaving coins on exchanges just to avoid any kind of risk.

[Lauda]

Do you know there are a lot of people are keeping their bitcoins (or altcoins) on the various exchange? After crying because the exchange was hacked. This thread is very , very useless ( I think no one should trust another person to manage your private keys, that's broke all the bitcoin concept).

Well you're treating me as I were new to this. All I can say:"Been there, done that.". I've been actively exchanging a lot of currencies on multiple exchanges in the past. I guess people trust too much or think that the exchange is a unbreakable fortress of some sorts. Actually the exchange is like a wooden fence protecting your money. Even though security has been improving, we are not there yet. Not even near.
Like I've said myself, giving anyone your key is wrong and then Bitcoin has almost no meaning.
A person is intended to be his own bank by keeping his own private keys and funds secured.

[Amph]

obviously yes, bitcoin is born to make people like us , who like to be self-bank, more prominent

i' fly low, just 3 usb stick with wallet.dat as backup some on the exchange and the rest on the client, i'm still unsure if i should create others wallet...

If I where you, I'd create a paperwallet cyphered or not that I would copy in several places to store the coins I want to hodl for long time 

i find usb much confortable and faster to use, if you hold several of them there is no worry about, i don't find them inferior to papaer wallet at all

[jonald_fyookball]

I don't manage my private keys. I let electrum take care of those and I manage my own secret seed. Only 12 words to remember or to keep safe. An easy task for most bitcoiners.

that counts as managing your private keys in the context of this discussion.

[Beliathon]

If you can't trust your own judgement, you can't trust anyone else either. Same as if you can't love yourself, you can't love anyone else.

[soowein]

I don't believe anyone even myself. How to manage own private key ? Simply save it in the safest place

I think so !

[madmat]

I don't believe anyone even myself. How to manage own private key ? Simply save it in the safest place

I think so !

One place is not enough. This place could be destroyed. Two safe places are better. Your head could be one of this safe place.

[teukon]

One place is not enough. This place could be destroyed. Two safe places are better. Your head could be one of this safe place.

Wait.  So I should make a backup in case my head gets destroyed?

Hmm... It seems Bitcoin is riskier than I thought.

[madmat]

One place is not enough. This place could be destroyed. Two safe places are better. Your head could be one of this safe place.

Wait.  So I should make a backup in case my head gets destroyed?

Hmm... It seems Bitcoin is riskier than I thought.

You could forget your secret, if you don't have a backup and if your wallet is very big, you are going to destroy your head. 

[howzar]

Yes, it's not that hard to print out a piece of paper and keep it in the same spot for eternity...or is it 

I personally store mine on a .txt doc on a USB that I keep in a safe. For all of my savings anyway. The rest I keep on my QT client and store those private keys just on the desktop with my chump change in it and daily use coins.

[HarryPotHead]

You have to trust yourself because if you don't how could you possibly trust anyone else? I will always manage my own keys and funds and always will i do not trust anyone else..

[--Encrypted--]

I do, but I don't think trusting myself is enough.
I gave my best friend my private keys.. tho he have no earthly idea what it is.

[15Lemon714]

I do.
and not only myself either, I even gave my best friend my private keys.. tho he have no earthly idea what it is.

You never know he may learn and best friends can turn against you when a nice amount of money is involved, just saying. I hold my keys on a backed up usb and it is under the floor board so it is pretty safe in every situation except the 2 obvious that i won't mention.

[randy8777]

I do, but I don't think trusting myself is enough.
I gave my best friend my private keys.. tho he have no earthly idea what it is.

better ask him to delete your private keys now he still don't know what it is.
if he does know what it is and it has decent enough value, then your friend might not be much of a friend anymore.

[zetaray]

I think this thread has back fired for OP. Xapo did not think so many people would only trust themselves with their private keys. As far as I know, Xapo wallet do not give users their private keys.

[--Encrypted--]

I do, but I don't think trusting myself is enough.
I gave my best friend my private keys.. tho he have no earthly idea what it is.

better ask him to delete your private keys now he still don't know what it is.
if he does know what it is and it has decent enough value, then your friend might not be much of a friend anymore.

RANT MODE BEGIN 

no way I'm gonna to that, I got to trust someone and the only one I can trust in this wicked world is him.
not going to bore anyone with my life story, but the guy saved me on more that ten occasions.

oh, and more than half of people in my country doesn't even know what bitcoin are.
half the guys from the IT doesn't even know it. I live in a retarded country which blocks reddit, so yeah.

RANT MODE END 

[knightblaster]

It doesn't seem to make sense for people to store bitcoins with a third party.  It goes against the entire premise of bitcoin, which is peer-to-peer transactions without intermediaries like banks.  It makes much more sense to manage your own keys, according to the degree of security/paranoia you personally feel comfortable with, which probably varies a lot depending on how many bitcoins you actually have.

Bitcoin online banks (online wallets) are not regulated, may not have deposit insurance, and do not pay interest -- so they're fairly different from fiat banks, and present different kinds of risks for someone depositing their keys there. 

For the masses, I can see that people won't want to manage their own private keys -- it seems too techie for them.  That's not true, but the masses tend to go for the easiest solution.  I can see the masses, if they ever really do adopt bitcoin to a larger degree, gravitating towards online wallets due to the ease of use and similarity with existing online fiat banking.  But for people who are enthusiasts -- which pretty much describes most people holding bitcoin currently -- it doesn't seem to make sense to hold your coins in a bitcoin bank -- goes against the entire philosophy of the system.

[jonald_fyookball]

I do.
and not only myself either, I even gave my best friend my private keys.. tho he have no earthly idea what it is.

You never know he may learn and best friends can turn against you when a nice amount of money is involved, just saying. I hold my keys on a backed up usb and it is under the floor board so it is pretty safe in every situation except the 2 obvious that i won't mention.

he will find out soon.  unless he's a backwards redneck moron

[asuryan180]

I do, but I don't think trusting myself is enough.
I gave my best friend my private keys.. tho he have no earthly idea what it is.

better ask him to delete your private keys now he still don't know what it is.
if he does know what it is and it has decent enough value, then your friend might not be much of a friend anymore.

RANT MODE BEGIN 

no way I'm gonna to that, I got to trust someone and the only one I can trust in this wicked world is him.
not going to bore anyone with my life story, but the guy saved me on more that ten occasions.

oh, and more than half of people in my country doesn't even know what bitcoin are.
half the guys from the IT doesn't even know it. I live in a retarded country which blocks reddit, so yeah.

RANT MODE END 

Just because a large amount of people you personally know doesn't know about bitcoin that does not mean you live in a retarded country lol That just means from the people what you know do not know about it yet, not really a bad thing either. I like the fact that you can trust someone with your keys i would say it is better than trusting somebody you don't know with all your coin. I personally don't have anyone to trust like that so i will hold my own and have back ups of back ups and if i fail then i failed i only have myself to blame.

[oblivi]

I think the whole point and what makes bitcoin cool is being your own bank, beside the great way to do worldwide transactions easily. I like the feeling of controling my own wealth. Of course guaranteed I get why some people would choose to not do it themselves.

[rio3232]

yes i am, no one know my password/private keys. and i have many recovers for forget password and etc. 

but the problem is if u save ur private key on wordpad or something on pc/netbook if ur pc/netbook crash it will hard to recover, i done this before 

[Xapo]

I think this thread has back fired for OP. Xapo did not think so many people would only trust themselves with their private keys. As far as I know, Xapo wallet do not give users their private keys.

My follow-up question would be, how many many people who voted Yes, 100%, have more than 10BTC? I'm curious if people's sentiment change as they get more BTC, or if people think there is only MORE reason to own your own private keys as your total BTC count increases. I know that most hedge funds, institutional investors, and high worth individuals do not protect their own private keys, they use a company like Xapo that specializes in security. Whether you TRUST someone else is another issue. What is undeniable is that our security infrastructure is obviously more sophisticated than what people here have suggested (USB stick in a floorboard, giving a private key to a friend, burying them in different locations, etc). How many of those who voted Yes are even producing their keys offline in line with deep cold storage practices? Yes, you must trust a third party, but if you can trust them like you trust a bank, no one denies that a checking account is more secure than a mattress full of cash.

[WhatTheGox]

I trust myself vs anyone else, my long term holdings are all offline, im backed up in case of fire/theft.  In order for someone to steal my coins i'd have to be very unlucky and figure its about 0.001% chance.  At those odds i feel about as comfortable as crossing the road after looking both ways. 

[MCHouston]

I have more then 10 BTC and I replied yes.

As a network security engineer, I know there are bad ones out there.  Any company could easily have a bad one and a bad security engineer at a Bitcoin exchange/storage and you will be hacked.  Even companies with good security engineers get hacked it is a race against time.

I would only trust a company with my private keys, if they were audited by a 3rd party company for security and also insured by a large 3rd party insurance company.  Even then it would be awhile before I trust them with a large amount of BTC.

[DannyHamilton]

no one denies that a checking account is more secure than a mattress full of cash.

In the U.S. that's because a checking account is insured by the FDIC and highly regulated by the government.  The banks also most undergo extensive third party audits for both financial status and security practices.  Futhermore, and perhaps most importantly, the banks have extensive powers to reverse payments.

There aren't any Bitcoin businesses yet that can say that they have all 4 of those features (full deposit insurance, regulations, security and financial audits, and transaction reversal powers).

[manselr]

I do, but I don't think trusting myself is enough.
I gave my best friend my private keys.. tho he have no earthly idea what it is.

better ask him to delete your private keys now he still don't know what it is.
if he does know what it is and it has decent enough value, then your friend might not be much of a friend anymore.

I wonder what the hell did the dude smoke to give his friend his private keys. I mean what's the point? He will probably lose them specially if he has no idea what that is, might throw them to the garbage bin one day.

[needFREElunch]

An interesting concept would be a bitcoin investment bank. You could put your bitcoins in and they would invest them by doing loans (like a bank) and then give the people putting there money in a percentage of the income(interest). I can see this happening with all of the people putting there money into ponzi's these days. Although the problem with this is that it would go against one of the points of bitcoin which is not relying on banks.

[Xapo]

no one denies that a checking account is more secure than a mattress full of cash.

In the U.S. that's because a checking account is insured by the FDIC and highly regulated by the government.  The banks also most undergo extensive third party audits for both financial status and security practices.  Futhermore, and perhaps most importantly, the banks have extensive powers to reverse payments.

There aren't any Bitcoin businesses yet that can say that they have all 4 of those features (full deposit insurance, regulations, security and financial audits, and transaction reversal powers).

Not quite yet, but Xapo passed a Service Organizational Control 2 (SOC2) financial audit by Burr, Pilger & Mayer LLP, and our Vault storage is covered by two policies that cover a wide range of potential situations, both an A rated insurance group, and Xapo's own captive insurance company.

[nambich]

Criticism often comes to online wallet providers (Xapo, Coinbase, etc) saying, if you don't own your private keys, you don't actually own your bitcoin. On the other hand, if your cash is in a traditional bank, you don't really own your cash either. The only possible difference, traditional banks have been around longer, and more people trust them. Many bitcoin users who criticize bitcoin vaults, store their cash in a traditional bank. Hypothetically, if Bank of America, or Barclay, or DeustcheBank announced they've invested millions into a highly protected, advanced, security architecture, would you trust someone to store it then? I personally don't trust myself to store my own bitcoin, for now. That could change in the future, but right now, I'm not a fan of the options, as the technology depends too much on my ability to maintain hardware, or, not lose something. I think about pictures, movies, files, documents, I had on my computer 10 years ago (and I always backed up), and I probably couldn't retrieve a single one without relying on a cloud-based service (Facebook, Google Drive, Dropbox, etc.). I have no idea where the original photos of my trip to Indonesia in 2008 are, but I know that album is still easily accessible on Facebook. Are critics right to say, don't use an online wallet provider, it's not safe?

No, I have never believed in myself in case of management my own private keys

[unamis76]

Came here from another thread... Damn, if you don't have 100% trust in yourself to keep Bitcoins, that's pretty risky, in my opinion. Don't take me wrong, but if one can't store his own Bitcoins, he loses something that is, in my opinion, one of the biggest advantages of Bitcoin when we compare it to fiat: you can safely store the funds yourself without the fear of getting robbed, if you know how to do it.

If someone hasn't got the will to search for methods to protect his funds, and to find time to implement these methods... Maybe he should just have fiat.

[Lauda]

Came here from another thread... Damn, if you don't have 100% trust in yourself to keep Bitcoins, that's pretty risky, in my opinion. Don't take me wrong, but if one can't store his own Bitcoins, he loses something that is, in my opinion, one of the biggest advantages of Bitcoin when we compare it to fiat: you can safely store the funds yourself without the fear of getting robbed, if you know how to do it.

If someone hasn't got the will to search for methods to protect his funds, and to find time to implement these methods... Maybe he should just have fiat.

Well people aren't simple and it comes down to the individual. I've stored mine in a secret place that I only know of. I can't lose them, unless I get a disease or something that makes me forget things.
It's not that hard to be your own bank.
I guess one of the best options would be to get it carved in stone or something. After all, paper can get easily destroyed.

[kpitti]

I like to manage my finance and keep it in hand. With fiat it`s difficult today as you need to trust bank, but this is different as I can have many of confirmations and informations how my bank works and how stable is. Therefore I trust my judgement. With Bitcoins it`s different. I am not in position to trust any of online "bank" yet. Only for limited amounts which I need to have ready for urgent transactions. Majority of my Bitcoins are kept with my complete control of private keys.

[Hazir]

Xapo, do you think that all people are idiots unable to administer their own belongings? And your mission is to help poor, undecided people and store their private keys in your online vault? Because there - in you hands people's keys are forever safe. And no hackers, nor any other calamity could ever take out these keys... Right...

[chmod755]

Xapo, do you think that all people are idiots unable to administer their own belongings? And your mission is to help poor, undecided people and store their private keys in your online vault? Because there - in you hands people's keys are forever safe. And no hackers, nor any other calamity could ever take out these keys... Right...

Maybe you can do it, but the vast majority (99%+) of the world population has no idea how to protect their computers - even people who worked as "IT security experts" for years occasionally fail to keep Bitcoins secure (e.g. Antonopolous).

[bornil267645]

What's the point of having a "Bank" of any kind if we are trying to use bitcoin instead of cash. So, yes, I'm responsible for my own keys. No way I am keeping my keys on a bank.

[randy8777]

trusting yourself shouldn't be a problem. bitcoin is about being your own bank. we don't need services to store value as we can do it ourself. there are so many secure options to store your coins offline in a safe place.

[boopy265420]

I voted for first option because I am confident of myself and always manage personally my important things from private keys to every little data about my financial and everyday used things.

[Barney Stinson]

More than anybody else thats for sure its a easy skill to learn and you get to brush up on security

[Lauda]

Xapo, do you think that all people are idiots unable to administer their own belongings? And your mission is to help poor, undecided people and store their private keys in your online vault? Because there - in you hands people's keys are forever safe. And no hackers, nor any other calamity could ever take out these keys... Right...

Maybe you can do it, but the vast majority (99%+) of the world population has no idea how to protect their computers - even people who worked as "IT security experts" for years occasionally fail to keep Bitcoins secure (e.g. Antonopolous).

A lot of those "IT security experts" or just "IT experts" are in general unskilled. I've seen examples of this throughout they years (no I'm not saying Antonopolous is).
We should work on educating people on proper security methods for both their wallets and computers at the same time. Both are connected. We should also recommend keeping funds in their own wallets instead of online services/wallets.

[Cryddit]

I trust myself to manage my own keys, but I acknowledge that I am a VERY exceptional case. 

Unless the security of desktop operating systems (*cough* windows *cough*) gets a hell of a lot better, I don't think most people can.

[Xapo]

I trust myself to manage my own keys, but I acknowledge that I am a VERY exceptional case. 

Unless the security of desktop operating systems (*cough* windows *cough*) gets a hell of a lot better, I don't think most people can.

I think that's my point. You have 85% of people who are saying that they will never trust a third party for storing their bitcoins. Naturally, 10 years from now, a percentage of these people will have lost some or all of their bitcoin (whether it be losing paper wallets, hacked computers, system failure, house fire, etc, it's inevitable, and undeniable). We've all lost cash in the past couple years, yet I doubt anyone here has lost cash FROM a bank (Of course, there may be some exceptions for our European friends in Iceland, or Cyprus, but I don't think they're present I understand people don't want to use a third party, trust me, if it was practical to store my fiat cash myself, I would, but I don't believe it is.

[Bitcoinpro]

in a fair just society like Crypto i won't be so worried about losing a bit of coin

[kolloh]

I trust myself to manage them but I am also a security conscious person.

I doubt I would trust an average user or nontechnical user to safely manage their own keys.

[Bitcoinpro]

I can't really see the point to this question since it will depend on how well people trust the security of an app on a particular device,

Phones are going to be trusted straight out of the box being secure, some will eventually have preloaded apps the phone manufacturers

and developers would stand to lose Billions if their company was shamed with an insecure device or app, the whole stream would be

so tainted its unlikely any insecure devices will be made from any main brand companies,

[Xapo]

I trust myself to manage them but I am also a security conscious person.

I doubt I would trust an average user or nontechnical user to safely manage their own keys.

There are lots of people I would trust more than myself, but I understand it's a personality trait. I'm paranoid of losing things, my keys, my wallet, my cell phone, etc. While I lose those things far less often than the average person (which I attribute to my paranoia), there is something that inherently makes me questions my ability to not lose stuff, and since I have a fair amount of bitcoin, I'm putting it in the hands of someone I trust more than myself. I understand working on the inside of Xapo, knowing the security team, and seeing the security architecture internally first hand, makes me more trusting, but I trusted Coinbase (and probably still would) even before I started working at Xapo.