This article was written by the Veriphi, Bitcoin consulting and security firm.
The famous long-awaited mass adoption of Bitcoin users is slowly taking place in the corporate world. Formerly booed and shunned by large organizations as a financial asset comparable to other more traditional securities, Bitcoin is now a lively subject of discussion among the boards of directors of companies.
Many of them decide to go ahead with products that offer the possibility of investing in Bitcoin easily and possibly profit from its price appreciation. Bitcoin is particularly popular as an investment among millennials who seem to understand its complex cogs more easily.
We have become particularly adept with banking financial applications. We can choose never to put our feet in a real bank, because we can now maintain and control the entirety of our finances from our phone.
This shift towards the digitalization of services has been in operation for many years in a range of industries. Bitcoin is grafted onto it naturally, because it comes entirely from the digital world at its core.
Also read: How to Reduce Your Bitcoin Transaction Fees.
A false sense of control
Having the ability to manage money from your phone gives you a sense of control since we feel like our bank is in our pocket. The reality is quite the opposite with the rise of the “open banking” movement which encourages the sharing of personal information between various applications and institutions. All this facilitated by democratization, interaction and information sharing tools that are APIs.
After a more in-depth analysis of this phenomenon, we realize that users of the traditional banking system are more and more subject to this regime.
Bitcoin is intended to be a complement to these systems, but above all an alternative option to the very nature of our money, which are fiat currencies. Living thanks to a decentralized system of complete nodes (servers), Bitcoin is completely heterogeneous to all the other systems and assets present on the current market.
It would be sad to see this new system corrupted by a revival of history, that of gold. Formerly, certain companies living according to the gold standard (the gold standard), lived a monopolization of this same asset through the creation of central banks which ended up monopolizing the majority of it.
Also read: How to properly secure your bitcoins, part one.
Bitcoin has many interesting properties that make it useful as a new form of money. The most important of these is that of its power not to be censored. It is impossible for a third party to prevent someone from operating with, receiving or sending bitcoins to whoever they want.
It is the opposite of your fiduciary money in the bank, which is entirely under the control of the custodian.
The equivalent of commercial banks in the Bitcoin world are the so-called “custodians” or money keepers, which are very popular among traders and many people who don’t want to worry about buying a physical wallet (hardware wallet). Yet the risk of loss without possible legal recourse is enormous and very common.
In order to protect yourself from this source of centralization in Bitcoin, it is important to keep it yourself as much as possible after having acquired it by following the famous advice: “Not your keys, not your coins”.
Also read: How to properly secure your bitcoins (second part).
The rise in popularity of online brokerage platforms and their danger
Previously reserved for the wealthy and an elite, the world of equities and its many derivatives has been greatly democratized through financial applications such as eToro or Robinhood.
Very easy to use and accessible to smaller portfolios, companies have experienced phenomenal growth in recent years and are valued at billions of dollars now.
One of their most popular and popular services for customers is crypto sales and purchases.
The most recent arrival in this world is the Canadian platform Wealthsimple which announced very recently that it would offer the possibility of investing in Bitcoin and Ethereum.
At first glance, this is great news knowing that Bitcoin is becoming more popular and is considered as an asset that has its place in the portfolios of investors. However, for the more seasoned Bitcoiners who read the FAQ, this is news with a sweet and sour flavor, because it will be impossible to withdraw the bitcoins purchased on Wealthsimple.
Similar to eToro which does not allow the withdrawal of funds purchased or Robinhood which strongly restricts withdrawals, Wealthsimple is the continuation of the interminable history of applications which centralize funds and the risks linked to huge sums of Bitcoin.
This is not to say that it is not good news in the end, because many people will be exposed to Bitcoin and will trust it more seeing that it is adopted by recognized institutions.
On the other hand, there is still a lot of educational work to be done on this subject to raise awareness of the values and ways of holding Bitcoin independently.
Many people in the future will hold funds with this kind of platforms, you just have to find a balance with those who follow the famous advice “Not your keys, not your coins” so that the history of gold does not end not reproduce with Bitcoin.
Consult thee site de Veriphi.
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