<story><title>Living Only on Bitcoins</title><url>https://www.evilsocket.net/2016/05/08/Hacking-Yourself-out-of-the-Banking-System-and-Live-only-on-BitCoins/</url></story><parent_chain></parent_chain><comment><author>lisper</author><text>I spent five years fruitlessly trying to improve the current banking system (actually, the current money transfer system) so I am more intimately aware of its shortcomings than most people.  Considering how many things are wrong with it, it&amp;#x27;s astonishing to me that it works at all.  And yet, most of the time, it does.&lt;p&gt;There are two things that make the current banking system robust: first, because anonymity is limited, most of the actors in the system are honest.  Trying to pull a fast one is risky, and that prevents most people from trying.  And second, there are humans in the loop that you can appeal to when things go wrong.  Most of the time this keeps the system humming along despite the fact that under the hood it&amp;#x27;s all held together with spit and baling wire.&lt;p&gt;Bitcoin is the exact opposite.  Because it provides greater anonymity than the traditional banking system, it attracts dishonest actors.  For example, bitcoin has made ransomware more economically viable than it was before.  And second, if something goes wrong with a bitcoin transaction, you are totally hosed.  Your bitcoin payment is only as safe as your ability to reliably bind a bitcoin address to an intended recipient.  If you get it wrong, there&amp;#x27;s no recourse.  If you accidentally send some bitcoin to the wrong address, you are hosed.  If you lose your private key, you are hosed.  Period, end of story.&lt;p&gt;If I have to choose between bitcoin and traditional banking I&amp;#x27;ll take the latter simply because it&amp;#x27;s generally more robust and forgiving of everyday human foibles.  But I&amp;#x27;ll continue to wish for (and work towards) a system that gives us the best of both worlds.</text></comment>
<story><title>Living Only on Bitcoins</title><url>https://www.evilsocket.net/2016/05/08/Hacking-Yourself-out-of-the-Banking-System-and-Live-only-on-BitCoins/</url></story><parent_chain></parent_chain><comment><author>cesarb</author><text>&amp;gt; I do not accept the concept of “trust”, I don’t know those guys, why should I trust them? On the other hand, with BTC trust is not even considered to be a factor.&lt;p&gt;That is a strange argument. The value of Bitcoin comes from the trust people have on Bitcoin. If nobody trusts Bitcoin, it&amp;#x27;s worthless except as a mathematical curiosity.&lt;p&gt;And after just a few more paragraphs, we see another instance of trust. The author describes leaving most of the money in a hardware wallet. That is, the author is trusting that the hardware is neither malicious nor buggy. A malicious hardware wallet could use kleptographic attacks to exfiltrate the private keys, or derive them from an attacker-controlled seed. A buggy hardware wallet could, for instance, have a &amp;quot;stuck&amp;quot; RNG (like a well-known OpenSSL fiasco), such that the generated private keys are predictable.&lt;p&gt;The author is trusting people he doesn&amp;#x27;t know: the designers of the hardware wallet, the manufacturers of the hardware wallet (including workers at whichever factory manufactures the hardware), and even the postmen. Moreover, the author is not only trusting them to not be malicious, but also to not make mistakes (with crypto, even small mistakes can be deadly).&lt;p&gt;And there&amp;#x27;s also at least one other problem the author didn&amp;#x27;t consider, or at least didn&amp;#x27;t mention: inheritance. If the author has an accident, what happens to the money? And what if the accident is not fatal, but leads to neurological sequels which render the author unable to access the hardware wallets?</text></comment>