• Press Releases
    • Submit a press release
    • Read All
  • Advertise
  • Contact us
Crypto.com Logo Crypto.com Logo
Bitcoinist.com
No Result
View All Result
  • Bitcoin
    • News
    • Price
    • Businesses
    • Acceptance
    • Technology
    • Investment
    • Regulation
    • Reviews
    • All Bitcoin News
  • Altcoins
    • News
    • Price
    • Ethereum
    • Ripple
    • Litecoin
    • EOS
    • NAGA
    • All Altcoin News
  • Tech
    • Blockchain
    • Security
    • FinTech
  • Industry
    • Press releases
  • Price
    • Bitcoin Price
    • Ethereum Price
    • Litecoin Price
    • Binance Coin Price
    • Monero Price
    • MimbleWimbleCoin Price
  • How to
    • Buy gift cards/mobile Top Ups with Cryptos
    • What Is Bitcoin?
    • Best Bitcoin Wallet
    • Bitcoin vs Ethereum
    • Why Use Blockchain Technology?
    • Bitcoin Cash ABC vs. Bitcoin Cash SV
    • How to Buy Cryptocurrency
    • Bitcoin Mining
    • Best Bitcoin Brokers
    • Best Bitcoin Forex Brokers
    • How To Earn Btcoin
    • What is Facebook Libra?
    • Ripple and XRP: The Complete Guide
  • Play Games
  • BET&WIN
  • Bitcoin
    • News
    • Price
    • Businesses
    • Acceptance
    • Technology
    • Investment
    • Regulation
    • Reviews
    • All Bitcoin News
  • Altcoins
    • News
    • Price
    • Ethereum
    • Ripple
    • Litecoin
    • EOS
    • NAGA
    • All Altcoin News
  • Tech
    • Blockchain
    • Security
    • FinTech
  • Industry
    • Press releases
  • Price
    • Bitcoin Price
    • Ethereum Price
    • Litecoin Price
    • Binance Coin Price
    • Monero Price
    • MimbleWimbleCoin Price
  • How to
    • Buy gift cards/mobile Top Ups with Cryptos
    • What Is Bitcoin?
    • Best Bitcoin Wallet
    • Bitcoin vs Ethereum
    • Why Use Blockchain Technology?
    • Bitcoin Cash ABC vs. Bitcoin Cash SV
    • How to Buy Cryptocurrency
    • Bitcoin Mining
    • Best Bitcoin Brokers
    • Best Bitcoin Forex Brokers
    • How To Earn Btcoin
    • What is Facebook Libra?
    • Ripple and XRP: The Complete Guide
  • Play Games
  • BET&WIN
Bitcoinist.com
No Result
View All Result
block intermediaries from bitcoin btc
Nexo

Should We Worry About Institutions and Intermediaries Holding Bitcoin? Yes

Emilio Janus by Emilio Janus
3 years ago
in Bitcoin, Bitcoin Investment, News, News teaser
0

bitcoin is a cultural movement. bitcoin is for people. bitcoin is about principles.

…or at least, this is the proposition that CoinShares Chief Strategy Officer, Meltem Demirors, put forward in a recent Twitter thread. In it she poses the question, “how do we allow for more [Bitcoin] participation through intermediaries without losing the message?”


Not Your Keys, Not Your Bitcoin

Demirors points out the dichotomy between the bitcoin community’s ideals and the reality of much of the industry.

5 BTC + 300 Free Spins for new players & 15 BTC + 35.000 Free Spins every month, only at mBitcasino. Play Now!

As a community, we value qualities like choice and access, self-sovereignty, privacy and consent, and we seek to remove rent-seeking. However, in reality, the majority of value in the industry that we have built is being captured by intermediaries.

1/ in the crypto community, we love to talk about things like
– choice and access
– self-sovereignty
– privacy and consent
– removing rent-seeking

but when we take a hard look at what we've built… the majority of value in our industry is being captured by intermediaries pic.twitter.com/PHmRn0hm9I

— Meltem Demirors (@Melt_Dem) September 27, 2019

New business models are emerging that cater to both the risk-taking, tech-savvy cypherpunks, and the risk-averse, technophobic ‘my dad’. However, ultimately, the power remains with those who control the coins.

BitStarz Player Lands $2,459,124 Record Win! Could you be next big winner?
Get 110 USDT Futures Bonus for FREE!

Considering all of bitcoin mined to date, an estimated 17% is in third party custody. This is a conservative estimate, but even this percentage is pretty significant.

Intermediaries Centralize Risk

Demirors continues to explain then when a small number of firms hold a large number of assets it centralizes risk.

With legacy finance, this is dangerous but not deadly. Bank bailouts are common, and the US government created the category of SIFI (or systemically important financial institution) in response to the 2008 financial crisis.

However, with bitcoin this is both dangerous and potentially deadly, argues Demirors.

When Binance’s hot wallet containing 0.03% of BTC in circulation got hacked in May, a roll-back was mooted but quickly rejected. But what would the position be if an intermediary holding 5% (or even more) of all bitcoin got hacked?

After the Ethereum DAO hack, 97% of ETH holders voted for the chain to be rolled back, against a minority who believed that this went against the immutability of the blockchain.

Finally, Demirors asks about a time when institutions put BTC into cold-storage and instead trade paper bitcoin depositary receipts (BDRs). Is this still BTC? Demirors isn’t so sure.

Which takes us back to our initial proposition.

bitcoin is a cultural movement. bitcoin is for people. bitcoin is about principles.

So how do we allow for more participation through intermediaries without losing the message? Let us know below. 


Images via Shutterstock, Twitter: @Melt_Dem

ShareTweetShareShare

Sign Up for Our Newsletter!

For updates and exclusive offers enter your email.

I consent to my submitted data being collected and stored.
Emilio Janus

Emilio Janus

Related Posts

Argentina

Argentina NGO Spearheads Mission To Educate High Schoolers About Crypto

4 hours ago
Shiba Inu

Shiba Inu Extinction: Finder Panel Predicts SHIB To Have Zero Value By 2030

7 hours ago
Russia

Russia To Legalize Cryptocurrency As Form Of Payment, Minister Says

9 hours ago
Bitcoin

Bitcoin Open Interest Nosedives, But All Hope Is Not Lost

17 hours ago
USDC Exchange Reserves Start Fall, Dry Powder For Bitcoin?

USDC Exchange Reserves Start Fall, Dry Powder For Bitcoin?

21 hours ago
Terra

Terra – A ‘Pyramid Scheme’ – Threatens The Crypto Ecosystem, Billionaire Says

22 hours ago

Bitcoin news portal providing breaking news, guides, price analysis about decentralized digital money & blockchain technology.

Bitcoin

  • News
  • Price
  • Businesses
  • Acceptance
  • Technology
  • Investment
  • Regulation
  • Reviews

Altcoins

  • News
  • Price
  • Ethereum
  • Ripple
  • Litecoin
  • EOS
  • NAGA

Categories

  • Blockchain
  • Security
  • FinTech
  • Technology
  • Trending
  • Breaking News
  • Press Releases
  • How to

Pages

  • Contact us
  • Editorial Policy
  • Advertise
  • Crypto Prices from Nomics
© 2022 Bitcoinist.com. All Rights Reserved.
  • Bitcoin
    • News
    • Price
    • Businesses
    • Acceptance
    • Technology
    • Investment
    • Regulation
    • Reviews
    • All Bitcoin News
  • Altcoins
    • News
    • Price
    • Ethereum
    • Ripple
    • Litecoin
    • EOS
    • NAGA
    • All Altcoin News
  • Tech
    • Blockchain
    • Security
    • FinTech
  • Industry
    • Press releases
  • Price
    • Bitcoin Price
    • Ethereum Price
    • Litecoin Price
    • Binance Coin Price
    • Monero Price
    • MimbleWimbleCoin Price
  • How to
    • Buy gift cards/mobile Top Ups with Cryptos
    • What Is Bitcoin?
    • Best Bitcoin Wallet
    • Bitcoin vs Ethereum
    • Why Use Blockchain Technology?
    • Bitcoin Cash ABC vs. Bitcoin Cash SV
    • How to Buy Cryptocurrency
    • Bitcoin Mining
    • Best Bitcoin Brokers
    • Best Bitcoin Forex Brokers
    • How To Earn Btcoin
    • What is Facebook Libra?
    • Ripple and XRP: The Complete Guide
  • Play Games
  • BET&WIN

© 2021 Bitcoinist. All Rights Reserved.

This website uses cookies. By continuing to use this website you are giving consent to cookies being used. Visit our Privacy Center or Cookie Policy.