Suppose you could travel back in time to 2010, how much Bitcoin would you buy? 10 thousand, 100 thousand or 1 million?
Most people today would not hesitate to put all their money in Bitcoin if given a second chance. Let us assume we are back in 2010, and you have got your hands on one million Bitcoin. You would be faced with a dilemma that many people still have. Where do you store all these coins? How do you make sure they are still safely yours ten years later in 2021? We at Matrix AI Network think we have found the answer.
How much Bitcoin have people lost in the past ten years?
To put the importance of the first part into context we will briefly investigate the amount of Bitcoin that is presumed to be lost. Let us simply assume that each Bitcoin address that has not seen any change in a long while is a Bitcoin that has been lost. (There is no way to know for sure if these are really lost). Then a total of 5 million Bitcoin (or 200 billion dollars at today’s value) are in this limbo state, whether their private keys are lost for good, or their owners have simply forgotten about them. To put it into context that is more than the net worth of the wealthiest person in the world. Although your Bitcoin might not be worth much today, the future value is unknown and one would not want to lose access to them.
Where then is a safe place to keep all your Bitcoin?
Before we offer our solution, we go over some choices that are currently available.
1. PC wallets (for example Bitcoin Core), 1 star, not recommended.
PC wallets were a popular choice in the early years of Bitcoin. A PC wallet keeps your Bitcoin in your hard drive. Most of the presumed lost Bitcoin mentioned previously are stored in PC wallets. Of course, Bitcoin was not of much value in those days, and many people were simply in it for the hype, mined some Bitcoin on their PC and soon forgot about them. They would be in for significant disappointment many years later when they tried to gain access to their wallets. Even if they still had held onto their five/six-year-old ‘antique’ of a PC, they would soon discover that the hard drive is most likely worn out and useless.
Needless to say then, storing your precious coins in a PC wallet is the last thing we would recommend. The Internet is full of horror stories of people who had it all, but then lost it all in the space of just a few clicks.
(This post tells the story of someone who used to have more than a hundred Bitcoin in his hard drive. He got himself another hard drive to backup those Bitcoin. For extra caution, he decided to format this new drive first to clear it of any malware. He unfortunately formatted the wrong one!)
(This post mentions someone who mined a dozen Bitcoin back when mining was easy. Many years later, she realized she had long since forgotten her private key.)
2. Crypto exchanges (Binance etc), 3 stars.
If you plan to store a considerable number of crypto assets on a crypto exchange, you are advised to use caution. Incidences are not rare where crypto exchanges fall victim to theft, and losses are often staggering.
The Mt. Gox hack of 2014 saw 850,000 Bitcoin stolen. It dealt a heavy blow to the crypto industry and arguably was the trigger for the bear market that followed.
Even reputable exchanges like Binance have fallen victim to theft multiple times. Although to be fair, Binance always cover the loss, the takeaway here is that even powerful exchanges with talented and resourceful people are not always impregnable. Ironically, larger exchanges are more vulnerable as they often have more hackers eyeing their wealth.
But what about the smaller exchanges you ask? They could take all your crypto assets and disappear at any moment. There are far too many instances of this happening.
As we can see, although exchanges are convenient places for storing a small number of crypto assets that you plan on trading with, they are not the ideal choice for holding large quantities for the longer term.
3. Mobile wallet app (like Imtoken), 3 stars.
As the crypto market gets larger, more mobile wallet apps are being developed. These wallets range from centralized ones to decentralized ones. Like with exchanges, centralized wallets run the risk of being hacked. Decentralized wallets on the other hand are safe in most situations, but it is up to you, the user, to keep your private key safe. Most people write down their private keys on a piece of paper and stash it away in a presumably safe place, but this can also be lost or destroyed. Having your private key stolen or losing your phone would be a nightmare and very costly.
Today many people are in the habit of using mobile wallets casually not knowing that their asset safety is actually under threat. Practices such as neglecting to scan your phone regularly for viruses, sending a private key backup to yourself over the internet or storing it in a virtual cloud could all expose your assets to the possibility of being lost or stolen.
If you do choose to keep a physical copy of your private key, the challenge then becomes how to safeguard it against damage or theft. Essentially the same concerns you have for any material wealth you possess.
Therefore, mobile wallets are also not the best place to keep your assets, especially if you want to be sleeping peacefully at night.
4. Ordinary hardware wallets, 4 stars
There are a bunch of hardware wallet options available on the market at present and most could offer better protection than the mobile wallets described above. However, you still need to ensure that you can remember the password/PIN and mnemonic. Should you lose or misplace them, your assets are also likely gone for good.
Do any of these options seem ideal? Is there a wallet that is both more secure and easier to use? Let us welcome the Matrix Bio-Wallet.
5. Matrix Bio-Wallet, 5 stars, highly recommended
What is the Matrix Bio-Wallet?
Bio-wallets are devices that use biometric information as identifiers. The Matrix Bio-Wallet is a hardware wallet that revolves around finger vein recognition. It supports the unlocking of your wallet as well as the signing of transactions using one’s finger vein, thus saving people from the stress of having to remember a password/PIN, and more. In theory, you would never lose access to the Bio-Wallet by forgetting your password.
One may still wonder, how is finger vein recognition different from fingerprint recognition?
Simply put, the difference lies in the level of security.
Finger vein recognition works by sending a beam of infrared through your finger to get the image of your vein. It utilizes the latest and greatest biometric recognition technologies, and you can count on it to perform this with speed and precision.
As part of a living organism existing underneath your skin and tissues, your vein is impossible to replicate using non-living objects. Fingerprints on the other hand are easy to replicate and you cannot avoid leaving your fingerprint on various scanner surfaces, which could expose your assets to unwanted risk.
Besides, finger vein recognition is less affected by your finger’s condition in comparison to fingerprint recognition. The latter could be affected by water or dirt on the finger, or even skin damage. Not to mention that some people do not have distinguishing fingerprint features or even more extreme some people are born without fingerprints.
This table summarizes the comparison amongst different options.
Please stay tunned about our second and third article featuring the details of Matrix Biowallet and Business Value, which are to be released next week.