Describes 4 common misconceptions about digital currency maintenance services by CEO Coinbase

Describes 4 common misconceptions about digital currency maintenance services by CEO Coinbase
Abstract

Brian Armstrong, co-founder and managing director of American Digital Currency Exchange and Wallet, Coinbase, in a February 22 issue of Fortune's Digital Currency Magazine, conveyed what she considered to be 4 It is a common misconception about digital currency maintenance solutions.

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Brian Armstrong, co-founder and managing director of American Digital Currency Exchange and Wallet, Coinbase, in a February 22 issue of Fortune's Digital Currency Magazine, conveyed what she considered to be 4 It is a common misconception about digital currency maintenance solutions.

Cold storage refers to the method of maintaining digital currency and the private keys of users to protect against theft via remote attack. The warmth storage refers to the exact opposite and to the storage on a device with an active connection to the Internet.

Armstrong's first argument suggests that hot storage is always necessary to provide the speed and flexibility needed to execute trades. He points out that some platforms allow users to use OTC for delayed payments, which means that after the transaction, funds remain in the form of offline storage.

A recent joint venture between BitGo and the Genesis Global Trading OTC trading platform allows customers to exchange digital currency without having to withdraw from the cache.

Armstrong's second point is dedicated to stock proofs based on digital currency (PoS). He points out that participating in a stock proofing and returning coin revenue system does not necessarily mean that the latter should be kept in a hot wallet.

The CEO of Quinbys has cited the digital tsef project and says it allows Token owners to transfer their funds to a Baker, who holds out a small portion of the funds online to redeem the rewards To produce. While customers' capital remains safe, it remains offline.

In the third case, Armstrong unravels the relationship between single key holders and whether the storage is cold or warm. He points out that the design of a solution to protect digital currency with the need for multiple keys, regardless of whether the funds are stored offline or online, is a precise and accurate measure.



Eventually, he points to hardware-specific security modules, saying that they can approach cold-storage security and can undoubtedly be useful for maintaining a digital currency architecture, but they can not, however, match it. Armstrong ends his paper with a note on hot storage. he writes:

With hot storage, there are a lot of details that you need to do right to keep your investment safe. Could you get all these details right? Yes, I'm comfortable using a warm storage for a reasonable amount. [...] Do I want to bet my entire business on the basis that all the details are completely correct? Probably not!

Earlier, the largest digital currency hacking in the industry has hitherto been due to the storage of coins in low security wallets in Japanese currency exchanges.

Source: cointelegraph

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