I'd that's fair but I would argue private key security and access controls for customer asset protection are the same thing. Until those are managed, tested, and audited it cant be fully disclosed. To be fair it seems like my argument is that nothing in the space can be fully disclosed, which honestly doesn't feel right

That being said both Gemini and Genesis had a SOC2 and maybe a SOC1 and look what it got them.

I don't understand why you feel there is a relationship between between the disclosure/auditing of assets and private key security. Can you elaborate on your thought process? Maybe explain it in a different way if you feel like you've already tried?

Also, I'm pretty sure I agree with this statement… thought I might say they're related instead of the same thing.

" private key security and access controls for customer asset protection are the same thing."

Pepper Brooks said:

---

Your options are…

1)hodl the BTC. Use other fiat for daily purchases.
2)use something like strike/coinbase to convert and withdraw dollars
3)do what AE suggests and try and find retailers/individuals that accept Bitcoin
4)use the BTC to buy giftcards at the retailers(Amazon, Walmart, etc) you frequent. There are a number of websites that facilitate this.

---

thanks PB

my concern would be what if Coinbase also collapses like FTX and Gemini and 3AC and all the rest

what would everyone with the coins on their wallets do if there are no more exchanges?

Peer-to-peer transactions. Exchange BTC for goods, services, or fiat.

The way I view it, for crypto assets the key is ostensibly the asset (as always NYKNYC). So when any third party has the key or access to the key it's the same as custodianing the underlying crypto asset.

Think like a businessperson: If you were to be paid BTC after completion of a project how would you protect yourself? You can verify BTC in advance but how do you know or trust the other side will be able to make full payment upon completion. If you were to be paid in gold, would you accept a photograph of the counterparty's gold stash and an IOU? Maybe if it's a $5 payment. But if it's a $50 million project, wouldn't you and your auditors want to verify the legitimacy of the gold and check that counterparty has controls in place to assure transfer can and will be made when due. If the counterparty segregates the asset into a cold wallet and then "looses" the key before the payment date, you're ****ed. Again, the key is the asset.

I know a response may be 'smart contracts' but I don't think any auditor has a framework for validating and testing smart contracts yet and as far as I know few real-life scenarios have been worked through.

A little help...fooling around with different exchanges, swaps, wallets, tokens, etc..prepping for the new low and next bull run...not used to doing this as I typically buy from Coinbase, Crypto.com, or Kraken and move to my Yoroi or Trust.

I can say that I am clueless on wrapped eth and swaps/conversions, especially on dApps.

If I have ETH and swap it for a Cardano based asset on Uniswap, it converts it into wETH correct, and then into the asset at the current rate? I don't like or trust these much but am confused.

In fractional reserve and credit based financial systems you can have double spending and/or credit extension. It's a protection and potential pitfall. Also, you receive insurance and recourse from trusted third parties like industry partners (think FDIC and SPIC) working with self-regulatory organizations, which are not applicable in the BTC space. The asset (money) is separate and distinct from the contract (credit). In BTC space the asset and contract (the key, or control of the key, and the asset) are the same thing. Hedging and insurance (and reinsurance) requires leverage and we've seen thus far that BTC is not a great asset for insurance vehicles (because NYKNYC).

It seems auditors are going to need a new framework for capturing the concerns that future transactions will be paid in full. There's no guarantee the counter party will maintain the key or access controls to the key. Multisig solutions are an obvious option but using a trusted third party is once again antithetical to the entire project. I imagine, firms will house the asset at a custodian where they can receive a rate of return similar to t-bills or commercial paper and manage the exchange/custodian-level risk. Thinking about it more, firms generally do not like locking up assets, but I do think cold wallets will be very useful for short-term escrow-like scenarios. Though cold wallets are much safer, I'm not sure it's always a wise business decision.

Contracts only work when there is money and/or power to enforce them. Ask Gemini and Genesis how their contracts with FTX are working out right now. Using the power and enforcement of the governmental court systems, paid for using fiat, as enforcement agent of BTC contracts comes across as backsliding. Obviously we are in teh early stages here so much of the legal and contractual stuff still has yet to be worked out.

ac04 said:

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LatinAggie1997 said:

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A little help...fooling around with different exchanges, swaps, wallets, tokens, etc..prepping for the new low and next bull run...not used to doing this as I typically buy from Coinbase, Crypto.com, or Kraken and move to my Yoroi or Trust.

I can say that I am clueless on wrapped eth and swaps/conversions, especially on dApps.

If I have ETH and swap it for a Cardano based asset on Uniswap, it converts it into wETH correct, and then into the asset at the current rate? I don't like or trust these much but am confused.

---

maybe just stop screwing around with ****coins?

---

The highlighted part is about dApps, exchanges, and the conversions, not the tokens.

I want an understanding of the process. It will help me to evaluate exchanges, dApps, tokens, and bridges from the inside. With more knowledge I can better determine the likely winners moving forward after the FTX fallout and pending regulations. I know bridges are were hacks take place most of the time. I don't use them but it is very likely that the few ecosystems still around after 2030 will be interoperable and use bridges.
The space is about to change. BTC won't be the only survivor nor the only means of making money. Some of these protocols will have to work together and how they do it is as important as which ones do it.
Those "sh!+coins", at least specific ones, generate passive income and/or will be sold to buy more BTC.

I have only purchased tokens and moved them to my wallets off exchanges. I have only used a few exchanges

Due to the lack of a digital native money, we had to use credit (IOUs) to send money electronically. Fraud & chargebacks made micropayments impossible.

— Gigi ⚡🧡 (@dergigi) November 25, 2022

You can monetize some services outright: storage and compute are easy examples, because they are scarce.

JPGs, however, are not scarce. They can be reproduced at zero marginal cost.

— Gigi ⚡🧡 (@dergigi) November 25, 2022

#Bitcoin ⚡ fixes this.

I believe that, in a value-enabled web—a web that does facilitate the free flow of payments, in addition to the free flow of data—new models will emerge that are not bound to selling eyeballs and outrage.

We should use money as money, not attention.

— Gigi ⚡🧡 (@dergigi) November 25, 2022

The thing about monetary value is that it is human action distilled. Many signals can be faked or auto-generated, be it views, downloads, comments, and even content and profiles.

In other words: talk is cheap. Sats are not.

— Gigi ⚡🧡 (@dergigi) November 25, 2022

A lot of people are trying to solve the conundrum the internet found itself in. @elonmusk wants to fix it. @jack understands these problems deeply and has the right ideas when it comes to fixing them.

— Gigi ⚡🧡 (@dergigi) November 25, 2022

@snowden understands these problems and is on the right track, and like him, I am optimistic that we will be able to fix them.https://t.co/0V4gf2BKf0

— Gigi ⚡🧡 (@dergigi) November 25, 2022

Digitally native money—money that is not credit—is a big deal. It is a big deal because infinite velocity of money is a big deal, and the removal of counterparty risk is a big deal.

There is a reason why cash is king. And when it comes to monies, #Bitcoin is the king of kings.

— Gigi ⚡🧡 (@dergigi) November 25, 2022

1. If BTC is going to be moved around like cash and credit it will have to become far less volatile, and people will have to want to use it. Too many people have diamond hands for BTC and the hodl mentality. What is the solution? wBTC?Nobody desires to break off pieces, chunks, or dust off their gold bricks.


2. Interesting...Opinion on this?
https://crypto.news/its-time-to-attach-verifiable-value-to-nfts/

Bitcoin's lack of centralization is also its doom.

It doesn't have anything to anchor it's demand.

It must be desired by the ruling class or it will always be a sideshow.

LatinAggie1997 said:

---

1. If BTC is going to be moved around like cash and credit it will have to become far less volatile, and people will have to want to use it. Too many people have diamond hands for BTC and the hodl mentality. What is the solution? wBTC?Nobody desires to break off pieces, chunks, or dust off their gold bricks.


2. Interesting...Opinion on this?
https://crypto.news/its-time-to-attach-verifiable-value-to-nfts/

---

1. Everything stated as true after IF was delusional. Volatile compared to what? Bitcoin fluctuates person to person across 8 billion people as infinitely valuable to 0% valuable. When we get closer to a 10% allocation of humanity appreciating the effectiveness of Bitcoin, the protocol wins.

Could be some speed bumps along the way.

2. What do you think?
What do you think I think?

bmks270 said:

---

Bitcoin's lack of centralization is also its doom.

It doesn't have anything to anchor it's demand.

It must be desired by the ruling class or it will always be a sideshow.

---

So, should the federal government and banks be the issuers of wrapped BTC for everyday use, while the custody of BTC remains with the owners?
Or
A CBDC backed by BTC?
Or
A combo of both?

Adverse Event said:

---

LatinAggie1997 said:

---

1. If BTC is going to be moved around like cash and credit it will have to become far less volatile, and people will have to want to use it. Too many people have diamond hands for BTC and the hodl mentality. What is the solution? wBTC?Nobody desires to break off pieces, chunks, or dust off their gold bricks.


2. Interesting...Opinion on this?
https://crypto.news/its-time-to-attach-verifiable-value-to-nfts/

---

1. Everything stated as true after IF was delusional. Volatile compared to what? Bitcoin fluctuates person to person across 8 billion people as infinitely valuable to 0% valuable. When we get closer to a 10% allocation of humanity appreciating the effectiveness of Bitcoin, the protocol wins.

Could be some speed bumps along the way.

2. What do you think?
What do you think I think?

---

1. Currency - unlikely/perhaps, store of value - absolutely yes.
How can 8 billion people use BTC if the majority don't own any and never will, and its purpose is to be in the people's hands? What is your scenario for the world using BTC for transactions and the method?

2. NFTs are going anywhere soon. I don't have or use them but I like the idea of attaching verifiable value.
You think they are dumb akin to a pic of a baseball card and useless.

BTC is a digital commodity right... A bi-monetary system using BTC as the reserve is how I see it as of now...with improvements implemented along the way. I also believe an ecosystem like Cardano will be necessary to onboard citizens into the space- literally and figuratively.


I was hoping for your ideas and thoughts on how 8 million people will use a scarce and soon to be expensive commodity for daily transactions, especially that you ONLY believe in BTC.

Imo, the FTX scandal will result in some obvious and not so obvious regulations and fractures, especially in ideology. Decentralization (and Identity) is about to be the talking point, a shift from smart contracts, and everyone will claim it and push for it. I believe institutions will begin searching for methods to onboard aspects of their business within the decentralized space, and try to control parts of it.
JPMorgan (Onyx), Oasis Labs, and others are already working on it.


Atala prism should be a player and might be the winner in that regard.

It definitely resulted in El Salvador making some moves.

Setup a BTC state office and classified all others as securities.

I feel like your post deserves a thoughtful response and I haven't digested it enough to give you that. In the meantime, here are a few gut reactions…

-I think that most Bitcoin advocates, including me, would say that the pitfalls of the current fractional reserve/credit driven system are not manageable or avoidable and such a system is doomed to fail.

-Most of us believe that what we're seeing from an inflationary, printing, and spending standpoint are the death throes of the post-1971 global financial system and that Bitcoin was not designed to be cut and pasted into the role of the dollar.

-Building on this train of though, I personally believe the system where Bitcoin has a center stage role will have to look very different than the one we currently operate in. As such, I agree we will need new frameworks for many things and that there will be a lot of tug of war between the current centralized entities in power and the decentralization purists, maybe call them anarchists?

Lastly, I'd be very interested to read your attempt to steelman the argument that a viable financial system can and should be built on something that functionally resembles bitcoin. A thing that is scarce, immutable, decentralized, and functionally operates as an asset and the contract, as you noted.

LatinAggie1997 said:

---

Adverse Event said:

---

LatinAggie1997 said:

---

1. If BTC is going to be moved around like cash and credit it will have to become far less volatile, and people will have to want to use it. Too many people have diamond hands for BTC and the hodl mentality. What is the solution? wBTC?Nobody desires to break off pieces, chunks, or dust off their gold bricks.


2. Interesting...Opinion on this?
https://crypto.news/its-time-to-attach-verifiable-value-to-nfts/

---

1. Everything stated as true after IF was delusional. Volatile compared to what? Bitcoin fluctuates person to person across 8 billion people as infinitely valuable to 0% valuable. When we get closer to a 10% allocation of humanity appreciating the effectiveness of Bitcoin, the protocol wins.

Could be some speed bumps along the way.

2. What do you think?
What do you think I think?

---

1. Currency - unlikely/perhaps, store of value - absolutely yes.
How can 8 billion people use BTC if the majority don't own any and never will, and its purpose is to be in the people's hands? What is your scenario for the world using BTC for transactions and the method?

2. NFTs are going anywhere soon. I don't have or use them but I like the idea of attaching verifiable value.
You think they are dumb akin to a pic of a baseball card and useless.

---

#2

Thread by ex-ETH core developer Greg Markou: https://t.co/9N0RhocGzd

— Tuur Demeester (@TuurDemeester) November 26, 2022

Wallets

Love when you load your wallet and all the information is there? Surprise, surprise thats difficult.

It's *expensive* to do a lot of lookups on a node about your account, specifically tokens.

So we *batch* them, and request all that info at the same time.

3/x

— Greg (@gregthegreek) November 25, 2022

Wallets cont'd

Wallets have no other option unless YOU RUN YOUR OWN NODE (as a start).

5/x

— Greg (@gregthegreek) November 25, 2022

Dapps Cont'd

Main reason:
The Dapp doesn't have a backend hosting an rpc node for you, so they use your wallet as a proxy (this is a standard).

PS: Light client's solve this, check out @lodestar_eth work

7/x

— Greg (@gregthegreek) November 25, 2022

Dapps Cont'd

"But they're not logging anything to a DB"

Cool, are they using any tracking software that might be? What if the tracking software gets hacked. Oops.

The really surprising thing is that there are two simple things devs aren't doing to prevent this.

9/x

— Greg (@gregthegreek) November 25, 2022

RPC Providers

*sigh* The obivous:

"60% of the time they're logging you every-time"

But for real, these businesses probably are, not necessarily maliciously, they are products. They need to learn to adapt. Understanding user behaviour is key.

Could they do better?

11/x

— Greg (@gregthegreek) November 25, 2022

To wrap this up.

👏 The 👏 whole 👏 industry 👏 is 👏 tracking 👏 you 👏

This is either by accident, because they didn't think of the repercussions of firing off requests to random rpc providers. Or just not thinking about how to efficiently design a dapp for privacy.

13/x

— Greg (@gregthegreek) November 25, 2022

Either way, you've probably already doxed all your addresses at this point. It's really hard to stay private on the internet, it has been built (arguably post-2010) with the intention to track you.

We're building ontop of web2 infrastructure, so it will always exist.

/fin

— Greg (@gregthegreek) November 25, 2022

My favorite thing with crypto is the long winded, non fundamental value approach. It's spectacular to watch.

I have no confidence he is acting on behalf of "the people ".

https://nypost.com/2022/11/26/sec-chair-gary-gensler-to-unveil-big-changes-amid-ftx-scandal/

Preston Pysh: "It makes me sick to my stomach...I refuse to participate in such ridiculousness. The pictures of the monkeys. Just IDIOTS...burn this thing to the ground. Just torch it."
🔥🔥🔥#bitcoin pic.twitter.com/nJPZ8eijdn

— Neil Jacobs (@NeilJacobs) December 1, 2022

Torch it. A great conflagration to release the locked up nutrients and allow for a fresh healthy bloom.

No surprise here:

https://fortune.com/crypto/2022/11/30/inaction-is-paralysis-cftc-chair-rostin-behnam-calls-for-regulation-in-the-wake-of-ftxs-collapse/

Quote:

---

Behnam said that the only cryptocurrency that should be viewed as a commodity is Bitcoin, walking back from previous remarks made in October when he suggested Ether may also be a commodity.

---

sorry for delay, I wanted to respond and then forgot.This issue is that the credit extension financial systems for centuries has run pretty well but is still susceptible to unforeseen failures. Even the best of intentions can lead to financial crisis like Rome in 33 AD or the across the world in 2008. BTC doesn't change the heart of man.

Removing the need for trust in financial decision making is like removing the need for love in marriage. It may work in some situations and cultures but it sure seems boring and reeks of complacency. I question the long-term sustainability if trust and risk and credit via faith in the system are removed.

The inflation argument is more about governments and their habits of overspending. I cant argue that; it a major concern. Credit extension by government finances all of these never-ending wars, expansion of police states, and growth of entitlements. But as you note those governments are doomed to fail which is long-term, possibly a good thing.

Deluxe said:

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No surprise here:

https://fortune.com/crypto/2022/11/30/inaction-is-paralysis-cftc-chair-rostin-behnam-calls-for-regulation-in-the-wake-of-ftxs-collapse/

Quote:

---

Behnam said that the only cryptocurrency that should be viewed as a commodity is Bitcoin, walking back from previous remarks made in October when he suggested Ether may also be a commodity.

---

---

Imo, BTC is clearly more of a commodity/currency and fall under CFTC purview. Ether is probably more of security and falls under SEC rules and regs.

I somewhat agree with you in the second paragraph as I've only ever lived in a system based on faith/credit. I honestly don't know that our society will respond well to the idea of a economy based on an inherently deflationary asset and be ok with the idea that growth is good but not always necessary. However, it feels like a better alternative to the current state of things but that could be recency bias.

I don't totally follow your train of thought in the first paragraph, though. BTC is more or less the antithesis of what you describe in the first two sentences and I think the qualities that make BTC attractive are attractive because they counter crucial flaws of human nature to some extent. Can you elaborate on what you meant?

Man is greedy and wants more. Extension of credit is one way we add value to our physical capital whiile also allowing others to express their human capital. However, too much extension of credit and economies collapse under their own weight. But traditionally that is because the cost of money, measured using interest rates, gets disconnected from the value of the underlying asset. We can't have the gains without the occasional failure.

BTC can't grow, can't be extended, and can't be improved upon. Its kind of the definition of stagnation. Also, BTC doesn't solve the issue that, like gold before it, pharaohs, kings, popes, governments will concentrate their power using an asset's scarcity as way to control the populous.

1. Do you believe a credit based system is feasible in the long term? The debt cycles seem fairly unavoidable and human nature ruins it. Especially when the system is tied to politics and it's incentives.
1a. If it's not feasible, I propose we set this topic aside as you seem to keep coming back to it. There is no point in comparing back to a credit based system if it's not a good long term solution.

2. This is more or less restating my " I honestly don't know that our society will respond well to the idea of a economy based on an inherently deflationary asset and be ok with the idea that growth is good but not always necessary." comment from above. I'm going to say we agree that society will need to undergo a potentially painful mindset shift/transition if we move to a BTC based, or backed, system.
2a. Is your main objection to BTC that you think the ask to society is to big of a hurdle to jump? Or is it something else?

Take government out of it, what is the problem BTC solves that credit based systems cannot?

BTC sole purpose of frictionless transactions is great but how valuable is that and how can humans approve upon it? If we cannot innovate and improve a technology, I question it's usefulness over time. BTC is already perfectly created to do what it was created to do but anytime humans get involved with it, we make it worse.

Frictionless communication isn't just restricted to transactions.

Adverse Event said:

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Frictionless communication isn't just restricted to transactions.

---

BTC doesn't do that. Have you read the white paper? Dont project opinions on a technology that has yet to prove its usefulness away from the stated purpose and use case.

tysker said:

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Take government out of it, what is the problem BTC solves that credit based systems cannot?

BTC sole purpose of frictionless transactions is great but how valuable is that and how can humans approve upon it? If we cannot innovate and improve a technology, I question it's usefulness over time. BTC is already perfectly created to do what it was created to do but anytime humans get involved with it, we make it worse.

---

I feel like I keep answering your questions with questions. But, would you trust a third party entity, that isn't the govt and is in a capitalistic model, with prioritizing currency stability, the needs of the consumers, etc. over their own profit? The problem that BTC solves here is that I don't even have to ask the question, as there is no third party, and I don't trust the incentive structure around the system your question implies.

If I'm an innovator, and I believe that the monetary system doesn't need to be perfected any further, my time/resources can be put towards innovating and improving other projects. Right?

Edits: I'm not opposed to continued innovation on BTC. I actually think it's imperative that people keep trying to improve the protocol, try and find weaknesses, build layer 2/3 concepts on top of it, etc. There is no reason why resources MUST be directed elsewhere but it's an option. The consensus mechanisms of the BTC protocol should prevent humans from ****ing up the base layer too badly due to the built in peer review.