Ethereum Co-founder Vitalik Buterin publicly criticized MicroStrategy co-founder Michael Saylor's recent comments. Bitcoin Self-custody.
In a recent interview, Saylor was asked whether handing over the management of Bitcoin to large banks or third parties poses a risk of centralization and could lead to governments seizing individual crypto holdings. Ta.
MicroStrategy's co-founder responded that holding Bitcoin in the hands of “paranoid crypto anarchists” who don't accept government regulation increases the risk of seizure.
Buterin disagreed in a subsequent tweet. “I am happy to say that Mr. Saylor’s comments are outrageous,” he wrote, adding that Saylor “seems to be clearly advocating for a regulatory capture approach to protecting cryptocurrencies.” The Ethereum co-founder also added that such an approach is not in line with the core principles of cryptocurrencies.
What is self-custody?
Self-custody is the process of maintaining control over yourself private keyThis means that no outside parties can access your information. cryptocurrency wallet.
Because this approach involves some degree of inconvenience and risk, as keys can be lost or stolen and there is no remedy, some users turn to third-party storage instead. This involves an independent custodian who controls the private keys to the wallet where the user's cryptocurrency is stored.
The risks associated with third-party storage are often summarized in the phrase “Not the key, not the coin.” This means that a third party has full control of the assets and could theoretically freeze or misappropriate them. There is pressure from authorities to do so.
Self-custody discussion
Buterin was responding to a tweet from Jameson Ropp, a cypherpunk and co-founder of Bitcoin self-management platform Casa HODL, in which he shared his views on self-management. Ropp emphasized that self-custody is essential not only to individual Bitcoin holders, but also to the health of the network as a whole. “Self-custody is critical to the continued strengthening and improvement of the entire network,” he said.
Ropp explained how concentrating coins in a few wallets increases the overall risk of loss or seizure, and disenfranchises users from running nodes and trading forks.
He also argued that there is less incentive for development because “institutions don't care about more advanced cryptographic features” and that “permissionless scaling becomes less of a priority because they can scale via a trusted third party.” .
Although Saylor doesn't seem to agree, the movement for self-custody of cryptocurrencies appears to have gained new momentum since the collapse of the FTX cryptocurrency exchange in 2022. Back in May, Oklahoma became the first U.S. state to pass a law protecting the right to self-custody. Bitcoin.
As MicroStrategy's Executive Chairman, Mr. Saylor has driven an aggressive strategy to acquire Bitcoin for the company's finances. The company currently owns more than 1% of all Bitcoins that will be mined in the future, valued at about $16 billion.
Earlier this month, Saylor announced that MicroStrategy would move from a software company to what he called a “Bitcoin bank” with a potential multi-trillion dollar valuation by issuing securities backed by Bitcoin. Outlined the plan.
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