With the Coinkite debacle regarding the shutdown of their web wallet services, many Bitcoin users are starting to look for alternatives. However, they continue to do so in the form of centralized wallet services, rather than taking full control over their coins at all times. Some people will only learn the hard way, by the look of things.
Also read: IBM Joins Consensus 2016 Fintech Conference as a Sponsor
Web Wallets Are Not A Great Tool
A recent post on Reddit mentions how former Coinkite users are looking for web wallet alternatives. Even though most people are well aware this is the same as giving up the financial control bestowed upon us by the Bitcoin protocol itself, it remains one of the most preferred solutions.
A web wallet with an onion address would, in theory, provide more privacy and anonymity to Bitcoin users. However, one user argued how onion addresses are not in the true spirit of anonymity. Then again, there is no such thing as anonymity in the Bitcoin world to begin with, nor should there be. More privacy wouldn’t hurt, though.
In the end, using a Bitcoin web wallet is the same as using a bank account and giving the institution full control over user funds. The illusion might be there of users controlling their own funds, as they are the ones who “own” the money in the first place. But reality will quickly tell them that, if something would occur with the service, funds could end up being lost forever.
With the wide variety of Bitcoin wallet solutions available, it seems rather strange anyone would want to use a web wallet. Granted, it is rather convenient at times, but only for a slong as the service can remain online. Additionally, not all Bitcoin web wallet providers are publicly sharing details as to who runs the service, making it all but impossible to recover lost funds if the service would disappear.
Bitcoin users have to be more careful as to where and how they store their coins, that much is certain. Web wallets are an interesting service, but should never be trusted with more money than people can afford to lose. The same can be said for exchange wallets, as the user is never in full control of their funds in that situation either.
Source: Reddit
If you liked this article follow us on Twitter @themerklenews and make sure to subscribe to our newsletter to receive the latest bitcoin and altcoin price analysis and the latest cryptocurrency news.
In my opinion, DASH is the best cryptocurrency. Dash is an open sourced, privacy-centric digital currency. It allows you to keep your finances private as you make transactions without waits, similar to cash.
This is why it is so IMPORTANT to understand how to keep your bitcoin safe and easy to use. My opinion is a great hardware wallet for storage with mobile capabilities for easy spending. You have to think of this like your current situation, you don’t put your whole paycheck on your mobile device, you deposit money in your account and withdraw or use your debit card, phone, etc. as needed. Bitcoin can work the same way, put your money in your own bank account like a KeepKey bitcoin wallet (there are others but I work at KeepKey and know it’s the best) and use your mobile device to pay for items. I just bought a blizzard for my kids at Dairy Queen last night with my bitcoin on my mobile phone, IT WAS AWESOME. A web wallet is NOT like using a bank account, a hardware wallet is.
At the moment the best option is a smartphone wallet with automatic backup of the keys (encrypted with password) on the cloud.
So you are in full control and even if your smartphone gets stolen or lost, nobody can spend your funds and you can recover your funds from the cloud service.
There’s no better way than this at the moment. Also hardware wallets are extremely dangerous: they can be broken, lost, decay with time: an automated backup service is absolutely needed for ANY sort of digital currency.
I prefer using Coinbase because you don’t have to pay fees on most transactions and several websites like Dell and Purse allow you to login with Coinbase and have your payment confirmed instantly.