Lost Bitcoin may be a ‘donation,’ but is it hindering adoption?
Cryptocurrency custody solutions have become a big business over the last few years. Independent storage and security systems meant to hold large quantities of crypto on behalf of clients can bring in institutional capital and retail investors waiting on the sidelines simply because they remove a major fear: losing access to funds that become unrecoverable.
Because of the decentralized nature of major blockchains like that of Bitcoin or Ethereum, whenever a user loses access to their wallet and doesn’t have a backup of their private keys, the funds within it cannot be recovered. There’s no central entity to turn to, and no one can control the blockchain to give anyone access back to their funds.
Storing a private key can be challenging, as it needs to be kept away from bad actors, yet close enough for the user to access it when necessary. Dealing with the challenges associated with managing cryptocurrency has seen many simply leave their funds on cryptocurrency exchanges, creating a massive demand for crypto custody services, to the point where America’s fifth-largest bank is offering a solution.
While keeping cryptocurrencies with a third party is often seen as a security risk because that third party can itself get hacked, experts told Cointelegraph that custody services are the best option out there when it comes to lost coins.
Early cryptocurrency adopters have lost cryptocurrency in numerous ways, including exchange hacks. These security breaches have seen Bitcoin academic Andreas Antonopoulos popularize the famous slogan “not your keys, not your coins.”
Cryptocurrencies can be lost in a number of ways, although unless someone admits that they have lost access to their funds, it’s impossible to tell from data on the
Read more on cointelegraph.com
