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Thread: What happens if a company or exchange collapses?

  1. #1

    What happens if a company or exchange collapses?

    Say I use Bitstamp to buy a crypto and tomorrow they go bankrupt.

    Do I lose my investment?

    And the Korean exchange that recently collapsed, how did that affect investors?
    "An idea whose time has come cannot be stopped by any army or any government" - Ron Paul.



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  3. #2
    Crypto is perfectly safe. Nothing could go wrong.

  4. #3
    Think of bitcoin like cash. If your bank goes under, the money in the bank is gone. (Let's ignore insurance for the moment). If you had withdrawn your money it's still under your mattress.

    Now some places do insure their customers. Coinbase does, I'm not sure about bitstamp or others.

    Some of those exchanges people keep coins on for trading purposes. Unless they are insured, which is unusual, then it's a risk to consider. The korean hack probably caused some people to lose crypto.

    If you are buying bitcoin and don't plan on using it right away then it's often best to transfer your coins from a bitstamp to something you personally control. This ensures safety.
    “…let us teach them that all who draw breath are of equal worth, and that those who seek to press heel upon the throat of liberty, will fall to the cry of FREEDOM!!!” – Spartacus, War of the Damned

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  5. #4
    Quote Originally Posted by Schifference View Post
    Crypto is perfectly safe. Nothing could go wrong.
    Never. Mt Gox. Or this one just a couple of weeks ago:

    http://www.businessinsider.com/cyber...-knees-2017-12

    A South Korea-based cryptocurrency exchange was brought to its knees by a cybersecurity attack.

    Yapian, the operator of crypto-exchange Youbit, halted trading of cryptocurrencies on its venue Tuesday and filed for bankruptcy after a hack, according to reporting by The Wall Street Journal.

    The Journal reported the exchange had 17% of its digital currency holdings stolen. The company witnessed a similar attack in April.

    The crypto world has seen its fair share of hacks and cyber issues. Most notably, Mt. Gox, a Japanese cryptocurrency exchange, was forced to declare bankruptcy in 2014 after a hacker moved hundreds of thousands of bitcoin from the exchange to his own account.

    And earlier this year, an estimated $280 million worth of the cryptocurrency ether was locked up by crypto-wallet company Parity because of one person's mistake. An unidentified user accidentally deleted the code library required to use recently created digital wallets within Parity, according to a security alert posted on the company's blog in November.
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    Quote Originally Posted by NorthCarolinaLiberty View Post
    I didn't actually read any of the thread. I now mostly just come here to mess with Zip.
    I am Zippy and I approve of this post. But you don't have to.

  6. #5
    Quote Originally Posted by unknown View Post
    Say I use Bitstamp to buy a crypto and tomorrow they go bankrupt.

    Do I lose my investment?

    And the Korean exchange that recently collapsed, how did that affect investors?
    Unless you are insured you lose everything .

  7. #6
    If you're lucky, the exchange might be able to raise additional money from investors to pay back customers (see what happened with NiceHash). Otherwise there might be a class action suit where you might be able to recover a fraction of the funds.

    Bottom line - don't store crypto assets on exchanges. If you don't have the private keys you don't own the coins.

  8. #7
    Quote Originally Posted by Zippyjuan View Post
    Never. Mt Gox. Or this one just a couple of weeks ago:

    http://www.businessinsider.com/cyber...-knees-2017-12
    Are you not aware that Mt. Gox was sued and paid out some settlements to customers?
    "He's talkin' to his gut like it's a person!!" -me
    "dumpster diving isn't professional." - angelatc


    "Each of us must choose which course of action we should take: education, conventional political action, or even peaceful civil disobedience to bring about necessary changes. But let it not be said that we did nothing." - Ron Paul

    "Paul said "the wave of the future" is a coalition of anti-authoritarian progressive Democrats and libertarian Republicans in Congress opposed to domestic surveillance, opposed to starting new wars and in favor of ending the so-called War on Drugs."

  9. #8
    Keeping crypto on exchanges does carry some risk, Ledger S Nano and Trezors make good hardware wallets.
    "He's talkin' to his gut like it's a person!!" -me
    "dumpster diving isn't professional." - angelatc


    "Each of us must choose which course of action we should take: education, conventional political action, or even peaceful civil disobedience to bring about necessary changes. But let it not be said that we did nothing." - Ron Paul

    "Paul said "the wave of the future" is a coalition of anti-authoritarian progressive Democrats and libertarian Republicans in Congress opposed to domestic surveillance, opposed to starting new wars and in favor of ending the so-called War on Drugs."



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  11. #9
    Quote Originally Posted by kpitcher View Post
    If you are buying bitcoin and don't plan on using it right away then it's often best to transfer your coins from a bitstamp to something you personally control. This ensures safety.
    personal control by no means "ensures safety". It simply transfers the responsibility for keeping it safe from others to yourself.

  12. #10
    With cryptocurrencies you have to accept full 100% responsibility for your own assets. Imagine that. Having to accept personal responsibility for something in this day and age. People aren't used to that, even in the so-called "liberty movement."
    Chris

    "Government ... does not exist of necessity, but rather by virtue of a tragic, almost comical combination of klutzy, opportunistic terrorism against sitting ducks whom it pretends to shelter, plus our childish phobia of responsibility, praying to be exempted from the hard reality of life on life's terms." Wolf DeVoon

    "...Make America Great Again. I'm interested in making American FREE again. Then the greatness will come automatically."Ron Paul

  13. #11
    Quote Originally Posted by dannno View Post
    Are you not aware that Mt. Gox was sued and paid out some settlements to customers?
    They have not paid out anything, it is still up in the air and I doubt I will get my money back. I posted about my experience with mt.gox here on 1-20-2014 and they went out of business a month later. http://www.ronpaulforums.com/showthr...e-alternatives

    This was when they handled 70% of all bitcoin transactions worldwide. The news media at the time would talk about mt.gox like they were a PR arm for them so there was no indication they were going to go out. What I described in that post is typical of how some of the exchanges are out there right now.

    I thought I would simply transfer money from bitstamp to mt.gox for a week and transfer it back out. Never got it back.

    I am not trying to dissuade anyone from investing but lets not sugar coat the harsh reality that it is a significant risk. Be prepared to lose everything you have invested as if you are gambling.

  14. #12
    Quote Originally Posted by Schifference View Post
    Crypto is perfectly safe. Nothing could go wrong.
    Then one day there was a solar flare.........
    Quote Originally Posted by dannno View Post
    It's a balance between appeasing his supporters, appeasing the deep state and reaching his own goals.
    ~Resident Badgiraffe




  15. #13
    Quote Originally Posted by William Tell View Post
    Then one day there was a solar flare.........
    If there is a solar flare that takes out the entire worldwide internet and the bitcoin blockchain, we'll be living in the world without anything modern. I'm going to assume guns, ammo, and food will be the currency of choice then. Everything of value will be worthless if you can't eat.
    “…let us teach them that all who draw breath are of equal worth, and that those who seek to press heel upon the throat of liberty, will fall to the cry of FREEDOM!!!” – Spartacus, War of the Damned

    BTC: 1AFbCLYU3G1dkbsSJnk3spWeEwpqYVC2Pq

  16. #14
    Quote Originally Posted by kpitcher View Post
    Think of bitcoin like cash. If your bank goes under, the money in the bank is gone. (Let's ignore insurance for the moment). If you had withdrawn your money it's still under your mattress.

    Now some places do insure their customers. Coinbase does, I'm not sure about bitstamp or others.

    Some of those exchanges people keep coins on for trading purposes. Unless they are insured, which is unusual, then it's a risk to consider. The korean hack probably caused some people to lose crypto.

    If you are buying bitcoin and don't plan on using it right away then it's often best to transfer your coins from a bitstamp to something you personally control. This ensures safety.
    For example, this Ripple, there are a few companies linked off their site which trade the coin.

    Its taking forever to open an account but once I do, and buy the goddam thing, could I then transfer the coins to my own "wallet"?
    "An idea whose time has come cannot be stopped by any army or any government" - Ron Paul.

  17. #15
    Quote Originally Posted by unknown View Post
    For example, this Ripple, there are a few companies linked off their site which trade the coin.

    Its taking forever to open an account but once I do, and buy the goddam thing, could I then transfer the coins to my own "wallet"?
    Yes.

  18. #16
    Quote Originally Posted by specsaregood View Post
    Yes.
    Would you be able to or mind providing more specific guidance?
    "An idea whose time has come cannot be stopped by any army or any government" - Ron Paul.



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  20. #17
    Quote Originally Posted by specsaregood View Post
    personal control by no means "ensures safety". It simply transfers the responsibility for keeping it safe from others to yourself.
    oh the god damn personal responsibility

  21. #18
    Quote Originally Posted by unknown View Post
    For example, this Ripple, there are a few companies linked off their site which trade the coin.

    Its taking forever to open an account but once I do, and buy the goddam thing, could I then transfer the coins to my own "wallet"?
    You're testing the banker's globally tracked currency system so there's a lot of databases your personal info has to be propagated to around the world. Be patient. Registering yourself as a global citizen will be much quicker once the bugs are worked out and their global currency is officially rolled out.
    Last edited by devil21; 01-02-2018 at 06:52 PM.
    "Let it not be said that we did nothing." - Ron Paul

    The entire internet is the domain of paid shills and bots. If you don't know this by now....

    Israel, under control of the Crown and, ultimately, the Vatican, own the USA. If you don't know this by now....

    Talk to people about liberty. You won't find it on websites, you won't find it in politicians.

    Visiting the Outer Banks of NC?
    Outer Banks NC Fishing Boat Rentals

  22. #19
    Quote Originally Posted by devil21 View Post
    You're testing the banker's globally tracked currency system so there's a lot of databases your personal info has to be propagated to around the world. Be patient. Registering yourself as a global citizen will be much quicker once the bugs are worked out and their global currency is officially rolled out.
    Let's say it's ripple, since that is decentralized and far easier for them to control.

    Ok, I'm going to use bitcoin instead.
    "He's talkin' to his gut like it's a person!!" -me
    "dumpster diving isn't professional." - angelatc


    "Each of us must choose which course of action we should take: education, conventional political action, or even peaceful civil disobedience to bring about necessary changes. But let it not be said that we did nothing." - Ron Paul

    "Paul said "the wave of the future" is a coalition of anti-authoritarian progressive Democrats and libertarian Republicans in Congress opposed to domestic surveillance, opposed to starting new wars and in favor of ending the so-called War on Drugs."

  23. #20
    Quote Originally Posted by dannno View Post
    Let's say it's ripple, since that is decentralized and far easier for them to control.

    Ok, I'm going to use bitcoin instead.
    You don't get it, do you? Bitcoin and Ripple and all the rest essentially communicate with each other. The entire purpose of the exchanges is to study and hone how to track interactions between various blockchains so all transactions around the planet can be 100% logged, identified and tracked. The notion that you are trading one "coin" for a different "coin" is idiotic. There is no coin. There are only records of interactions on a single chain and interactions between multiple chains across the planet. And you all are doing the testing for them.
    "Let it not be said that we did nothing." - Ron Paul

    The entire internet is the domain of paid shills and bots. If you don't know this by now....

    Israel, under control of the Crown and, ultimately, the Vatican, own the USA. If you don't know this by now....

    Talk to people about liberty. You won't find it on websites, you won't find it in politicians.

    Visiting the Outer Banks of NC?
    Outer Banks NC Fishing Boat Rentals

  24. #21
    Quote Originally Posted by unknown View Post
    Would you be able to or mind providing more specific guidance?
    To be honest and not trying to be an $#@!, but if you can't do the searches and study/figure it out yourself, then its probably safer if you leave it on the exchanges.

  25. #22
    Quote Originally Posted by unknown View Post
    Would you be able to or mind providing more specific guidance?
    I like the Ledger Nano S hardware wallet. It's about $135 on amazon, make sure wherever you get it (even amazon) that it is a trusted seller.

    Just be really careful, follow the instructions, and learn how to use the device with very small amounts of crypto, learn how to recover your main wallet and hidden wallet if you use that feature. There are all sorts of tutorials and youtube and such. Once you feel really comfortable using it and restoring it and moving crypto around, then you can start putting larger amounts on there.

    Your 24 word passphrase is crucial, you cannot lose that or you are completely screwed unless you have a working wallet and pin and can get the funds off. It should not be on a computer unless it is encrypted and really secure, and even then kinda dangerous. You can keep it in a fireproof safe or a safety deposit box or something, you can get kinda creative but be smart. I.e. you could stamp it into a steel plate, put it in a ziplock and bury it on your property or in the wilderness and just write down the GPS coordinates. If you can have a secure backup copy somewhere else, that's good too.
    Last edited by dannno; 01-02-2018 at 10:46 PM.
    "He's talkin' to his gut like it's a person!!" -me
    "dumpster diving isn't professional." - angelatc


    "Each of us must choose which course of action we should take: education, conventional political action, or even peaceful civil disobedience to bring about necessary changes. But let it not be said that we did nothing." - Ron Paul

    "Paul said "the wave of the future" is a coalition of anti-authoritarian progressive Democrats and libertarian Republicans in Congress opposed to domestic surveillance, opposed to starting new wars and in favor of ending the so-called War on Drugs."

  26. #23
    Quote Originally Posted by devil21 View Post
    You don't get it, do you? Bitcoin and Ripple and all the rest essentially communicate with each other. The entire purpose of the exchanges is to study and hone how to track interactions between various blockchains so all transactions around the planet can be 100% logged, identified and tracked. The notion that you are trading one "coin" for a different "coin" is idiotic. There is no coin. There are only records of interactions on a single chain and interactions between multiple chains across the planet. And you all are doing the testing for them.
    First I've seen this take.. Got an article that discusses it?

  27. #24
    Quote Originally Posted by dannno View Post
    I like the Ledger Nano S hardware wallet. It's about $135 on amazon, make sure wherever you get it (even amazon) that it is a trusted seller.

    Just be really careful, follow the instructions, and learn how to use the device with very small amounts of crypto, learn how to recover your main wallet and hidden wallet if you use that feature. There are all sorts of tutorials and youtube and such. Once you feel really comfortable using it and restoring it and moving crypto around, then you can start putting larger amounts on there.

    Your 24 word passphrase is crucial, you cannot lose that or you are completely screwed unless you have a working wallet and pin and can get the funds off. It should not be on a computer unless it is encrypted and really secure, and even then kinda dangerous. You can keep it in a fireproof safe or a safety deposit box or something, you can get kinda creative but be smart. I.e. you could stamp it into a steel plate, put it in a ziplock and bury it on your property or in the wilderness and just write down the GPS coordinates. If you can have a secure backup copy somewhere else, that's good too.
    double encrypt it in a veracrypt container and put it on dropbox. copy it on usb keys.

    opsec is the big new skill to have.



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  29. #25
    Quote Originally Posted by DGambler View Post
    First I've seen this take.. Got an article that discusses it?
    I would buy a tinfoil hat instead. Also be very very careful. A solar flare will hit us anytime soon and you will lose everything.

  30. #26
    Quote Originally Posted by DGambler View Post
    First I've seen this take.. Got an article that discusses it?
    No, because most of the people involved in the crypto mania (prime evidence in this subforum) don't know about anything or care about anything except the illusionary wealth they think will be lavished upon them. Developing a global blockchain system is well documented in globalist white papers (World Government Summit whitepapers are a good place to look, for example). Go learn about how token ring networks operate. Then extrapolate that across the entire planet. NSA, in collaboration with MIT, openly discussed cryptocurrency in 1996, and NSA is an arm of the bankers. Google it. There's a lot more parts I could post but don't see the point. I use multiple avenues of evidence to form a conclusion instead of just reading other people's thoughts (articles) and adopting them as my own. This is all very well planned and the only way for the bankers to roll out their global currency is to push it into the mainstream (unregulated and unofficially, however) and sell it as a get-rich-quick to the young people so they voluntarily act as the global testing team. Put aside all biases and ask yourself one single question. Why have practically all of the advertised "advantages" of crypto currencies turned out to be utterly false? My answer is: because a bill of goods was being sold to get people to adopt something for testing that otherwise could not be effectively tested to the extent needed, while still maintaining project confidentiality.

    eta: Look up Lynette Zang's commentaries on yt about ACChain/ACCoin and all things crypto/blockchain. She knows what's going on.

    I haven't watched this video but it's probably a good analysis.
    Last edited by devil21; 01-03-2018 at 01:25 PM.
    "Let it not be said that we did nothing." - Ron Paul

    The entire internet is the domain of paid shills and bots. If you don't know this by now....

    Israel, under control of the Crown and, ultimately, the Vatican, own the USA. If you don't know this by now....

    Talk to people about liberty. You won't find it on websites, you won't find it in politicians.

    Visiting the Outer Banks of NC?
    Outer Banks NC Fishing Boat Rentals

  31. #27
    Quote Originally Posted by Mordan View Post
    I would buy a tinfoil hat instead. Also be very very careful. A solar flare will hit us anytime soon and you will lose everything.
    Are you serious about the solar flare?
    It's all about taking action and not being lazy. So you do the work, whether it's fitness or whatever. It's about getting up, motivating yourself and just doing it.
    - Kim Kardashian

    Donald Trump / Rand Paul (Vice Pres) 2016!!!!

  32. #28
    Quote Originally Posted by specsaregood View Post
    To be honest and not trying to be an $#@!, but if you can't do the searches and study/figure it out yourself, then its probably safer if you leave it on the exchanges.
    I can but its nice if you can get guidance from a person who has experience.
    "An idea whose time has come cannot be stopped by any army or any government" - Ron Paul.

  33. #29
    Quote Originally Posted by Mordan View Post
    double encrypt it in a veracrypt container and put it on dropbox. copy it on usb keys.

    opsec is the big new skill to have.
    What in the $#@! did you just say?

    Seriously, can you tell me, because I want to know how to do this.
    "An idea whose time has come cannot be stopped by any army or any government" - Ron Paul.

  34. #30
    Quote Originally Posted by unknown View Post
    What in the $#@! did you just say?

    Seriously, can you tell me, because I want to know how to do this.

    He was talking about the 24 word passphrase that you have to either write down and secure physically in the real world or encrypt onto a computer and secure. It's very difficult to make it secure and hack proof leaving it on a computer system, so most people write it down on a piece of paper and lock it up somewhere, but you CANNOT lose it, hence fireproof safe, maybe keep a backup in a safety deposit box or somewhere offsite that is also safe and secure. Each person has to decide what is best and most secure for them based on their living situation and how much crypto they have. Someone in the city might do it different than someone in the country. Someone with a half BTC might do it differently than someone with 500 BTC.

    The point is there is a 24 word passphrase (plus a personal passphrase to get into your 'hidden' wallets) that will allow you to restore your wallets on any compatible wallet device in case you lose your hardware wallet or it gets stolen. A stolen or lost wallet is a ~$135 loss, they won't be able to take your crypto, you just have to buy a new device and restore it to that. The key is keeping the 24 word passphrase safe and secure somewhere.

    You can google veracrypt container and watch youtube videos all day and learn about them. I presume you would just write down the 24 words in a text file and put them in the container, then possibly encrypt that into another container, then upload to dropbox account, and keep a backup on some USB thumb drives, I think is what mordan was saying. Even then I'm sure there are more precautions, like you might not wanna be online while doing it, make sure it is a device only you have access to, no keyloggers, malware, etc..

    You can google ledger nano s and watch youtube videos all day about how to use the wallet, create and restore wallets, move around crypto, etc.
    Last edited by dannno; 01-03-2018 at 05:43 PM.
    "He's talkin' to his gut like it's a person!!" -me
    "dumpster diving isn't professional." - angelatc


    "Each of us must choose which course of action we should take: education, conventional political action, or even peaceful civil disobedience to bring about necessary changes. But let it not be said that we did nothing." - Ron Paul

    "Paul said "the wave of the future" is a coalition of anti-authoritarian progressive Democrats and libertarian Republicans in Congress opposed to domestic surveillance, opposed to starting new wars and in favor of ending the so-called War on Drugs."

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