Trading carries a high level of risk, and may not be suitable for all investors. You should never invest money that you cannot afford to lose.

Wednesday, 15 November 2017

Weaknesses of crypto-currencies

Some weak points to consider when working with cryptos:
  • there is no official way yet to legally prove that you are a legitimate user of the wallet address you are using
  • there is no way to revoke private keys if your wallet is lost or stolen
  • you must have money to receive money

There is no way to be legally recognized as the real owner of the address and funds

That is if somebody else gets access to your funds, it will be very hard, if not impossible to call the police and explain to them a "private key theft" or a "wallet file theft".

There is no way to revoke private keys if your wallet is lost or stolen

For example if you lose your credit/debit card, it can be blocked by the bank and another card can be linked to the same bank account. While for cryptos, if your wallet-file or private key is lost, or it has been stolen, kiss your coins goodbye.

You need to have money in order to receive money

Using an Ethereum smart contract, on a decentralized exchange, if you transfer too much money from your wallet to the contract address, you won't be able to withdraw from the contract back to your wallet until you deposit some more money in the wallet. 

This is due to a limitation of how smart contracts work. We didn't analysed if this happens with any contract or only with some of them.

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Trading carries a high level of risk, and may not be suitable for all investors. You should never invest money that you cannot afford to lose.

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Trading carries a high level of risk, and may not be suitable for all investors. You should never invest money that you cannot afford to lose.