I do see an issue with people understanding how to control their keys and not having the backing of their bank protecting them. My mom for instance, has had her bank save her multiple times from money that was lost due to whatever fraudulent means they used. The bank then takes on those losses and gives the money back to the user that lost it, in this case, my mom.
I feel this is a huge issue with the crypto world. Once you lose your money, it is gone. Who is going to give you that money back? Where is a way to reverse that transaction. Well, we all know there isn't a way.
So what can be done, is there some sort of insurance you can get that if a fraudulent person gets a hold of your keys, you can get refunded that amount from this insurance company? Do we just understand that if we lose our keys, we are out of luck?
I imagine for many people, understanding having multiple keys, using cold storage, air gapping computers... It is a lot of work. That is what a bank is for. To deal with that crap.
While I agree that it is a wonderful thing and it can definitely be utilized far and wide and hopefully, everywhere, with no more need for a bank. I think that for normal users, these are questions we are going to have to have an answer to. People like simplicity, without it, I don't think we can become as utilized as banks.
Any thoughts on how we can fix that? Is insurance a good idea?
Steem has something that no other blockchain has so far as far as I know for the first part. If someone steals your private key and changes it, you have 1 month time to recover it by providing your old private key and information that proves you are the original owner of the account.
On other chains, once someone steals your private key, its a "whoever sends the funds to another address first, gets them" which is the hacker most of the time obviously.
But if you lose your private key and don't have any access to it, then your account is gone forever, no one is able to retrieve it. If Steemit would be able to retrieve it that means they would have a copy of your private key and the funds of the account would never truly be in your control only.
Maybe we should create an SMT for a company where we pay a certain fee for them to keep our keys safe and secure in case we lose them somehow, but until then all we can do is make copies of them and save them here and there.
I understand that you can get your account back, but you can not regain the funds that were lost correct? If someone sends thousands of Steem or SBD to another address, you are lost for that money correct? While I understand it takes time to power down Steem, there is still a chance of losing a large sum of money. This was my main point. Nobody can give your money back. Unless I am mistaken on how they account recovery works?
Yeah no, the liquids are gone in that case.
So I feel that is the thing we need to try to answer for when people want to know what happens when their information, or keys, are stolen. Like I said earlier, if my bank account or credit card is compromised, I can get refunded for that money I lose. No such hope in the crypto world.
Why would somebody move all of their money into a form that they could lose with no help for getting it back once it is gone.
Crowd source insurance for if you lose your key for a bit and get some liquid Steem stolen? Then we gotta somehow figure out people aren't doing fraudulent claims. Basically, we would have to have an insurance company that we pay, to insure our crypto that is stolen if we lose our key.
That's probably 99.99% of the cryptospace currently, considering the marketcap is over $170 billion I'd say a lot of people. :P
All I'm saying is that comparing Steem to the others, here you have a better safety if you have your funds in SteemPower and have registered the account through @steem.
I can see insurance companies being needed in the future of blockchain security, though.
For sure, but the people who have money in crypto, they haven't moved all of there money into it. I am sure there are some people, but for the vast majority, everybody still has a bank account and a credit card.
Steem is definitely ahead of the curve. I just feel we have a lot further to go before people are able to utilize the block chain like we can utilize a bank or a credit card. And one of those, is the insurance I have for my funds if they are lost.
Thanks for the talk Acid!
Indeed @biasnarrative, we have a lot to go further to reach that target, so much that I have few hope that I will be still alive to see it, but this is the inevitable future. Blockchain technology is the inevitable future of the financial world.
@acidyo, I think you are right about the insurance company aspect but one alternative could be (shameless plug coming), a protocol like ours that resolves disputes through smart contracts, and manages escrow through the blockchain. I think this could one method of securing crypto investments across multiple platforms.
That's the one negative aspect of the tech.
Then again you could also debate how safe your liquids are on your bank accounts. :P
But, my bank will refund the money I lose.
Your bank will also cut off your funds, or confiscate your funds, if they decide you owe the money to the state, or other entity (like ex-wife).
The bank will not help you if you come by large sums of cash legally (as in farming hemp). Banks are generally, more trouble than they are worth for many people. I only use credit unions, not banks, as little as possible.
Don't use banks any more than you have to use them. I don't. I keep just enough in them to pay my monthly bills. Use a credit card instead of a debit card too to avoid your actual bank funds being stolen.
For Steemit.com specifically, keep the majority of your funds in Steem Power or Savings instead of STEEM or SBD. That protects it from immediate withdraw if you fall for a phishing trick and share your key.
As far as I know, no one here has been hacked. They've all fallen for a scam instead. That's the user's error, not a problem with Steemit.com.
Don't have just one account either. Spread your savings around to better protect them. No one should have a majority of their wealth in one account anyway. That's asking for trouble.
Great advice, and I like your ideas about banks too.
Thank you and followed!