
Coinbase Custody Is Officially Open for Business - nnx
https://blog.coinbase.com/182c297d65d9
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Animats
Terms:

Setup fee: $100,000 USD

Annual fee: 1.2% of the balance.

Minimum balance: $10,000,000 USD

Insurance: No info available.

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ojr
Insurance:
[https://www.coinbase.com/legal/insurance](https://www.coinbase.com/legal/insurance)

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Animats
That's Coinbase generally, not the custodial service.

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ojr
It says individual balances are FDIC insured up to $250,000. which is lower
than the setup fee and minimum balance for the custodial account, I share the
link to show they have some systems in place, speculation and trading will
never be risk-free I think

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ricksanch88
They can't even get their two factor authentication to work. Their customer
service a joke, and their processing takes too long.

Why people are hyped over their new products / features knowing how shit their
old ones are is beyond me.

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willio58
Every time a new Coinbase feature or product is posted on HN most of the
comments are anti-Coinbase.

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yohann305
Not sure if this is related or not, but Coinbase's cryptocurrencies of choice
(Bitcoin, Ethereum and Litecoin) just got a huge price bump in the past 2
hours which makes total sense because if this "Coinbase Custody" system is
adopted by businesses and institutions, huge amount of money will be poured
into these cryptocurrencies which will dwarf the current price.

Am I missing something or it makes sense?

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briatx
Institutions want investments that confer actual rights, something which these
cryptocurrencies do not do.

If you are expecting a large influx of institutional investment money, I
expect you will be disappointed.

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jeremyt
That’s not true. For example, owning bitcoin gives you property rights.

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bdamm
Are you referring to the right to obtain profit from forks?

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jeremyt
No, i’m talking about the fact that bitcoin is literally property according to
the government.

Also profit != property.

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beefield
Next step: Coinbase gives discount of custody service fees - or even pays the
deposit maker a fee (a.k.a interest) if it is allowed to lend coins forward
while coins are within custody (a.k.a fractional reserve banking).

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wereHamster
"fractional reserve banking" would be the case if Coinbase lends more than it
holds in their accounts. That's impossible with bitcoins.

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occamrazor
That's possible. They can lend the same bitcoins to many different people,
with the expectation that not all of them will withdraw the borrowed coins at
the same time.

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erikpukinskis
How do you lend the same cash to two people? Don’t people take loans to spend
the money?

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occamrazor
If Coinbase customer A borrows bitcoins and transfers them to Coinbase
customer B, those bitcoins never leave Coinbase, assuming that customer B does
not transfers them immediately out of Coinbase. Same happens if Coinbase
customer A tranfers 1 BTC to Bitstamp customer B and Bitstamp customer C
transfers 1 BTC to Coinbase customer D. Fractional reserve banking can happen
(and did happen) even without a central bank, with gold backed currencies.

~~~
erikpukinskis
So, if you need a loan for rent for your startup, and your landlord is also a
Coinbase customer, then this is possible.

But I don’t understand your argument... you’re talking about a future where
Coinbase has the installed base of, like, Venmo?

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cbase22
Coinbase stole $30,000 from me and won't return it. They listed a new coin
(bitcoin cash) without prior announcement. I bought $30,000 worth at $5000
each. It went from $500 to $9000 in a matter of minutes. However, while
allowing people to buy the coin at very high prices, they also froze
everyone's ability to sell the coin. They only allowed people to sell it on
their market again, about 24 hours later, after the coin went down to $1,000.

They say that coinbase engineers knew about the coin being listed beforehand
(obviously) and bought a bunch before listing it publicly (an unannounced),
then the insiders sold it all for a huge profit.

What lesson did I learn? Coinbase is crooked.

Oh well. Lock 'em up

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21
Stole has a particular legal definition.

Assets being stopped for trading occurs in all markets, including in the
highly regarded US stock market.

You wanted to participate in a pump and dump, and now you are angry that you
couldn't do the dump. You thought it was easy money, well, now you know one
aspect that you didn't consider (that selling might be suspended)

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infogulch
Either the market is open or closed, and when that changes is a very well-
known schedule (for the most part). Even the US stock market would run into
some very unhappy people if they _partially_ closed a market (e.g. only
allowed buying, not selling) or they closed a particular stock at their whim.

I'm not saying this wasn't risky or dumb, I'm just saying the US stock market
is a poor counter-example because both of the things that happened in this
case are exceedingly unlikely to happen on the US stock market.

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mjcl
Trading is ‘closed’ (aka halted) for individual securities relatively
frequently in the US. See
[https://en.m.wikipedia.org/wiki/Trading_halt](https://en.m.wikipedia.org/wiki/Trading_halt)

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ianhawes
It's a shame that Coinbase, of all people, demands payment for Coinbase
Custody in a fiat currency of US Dollars.

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wmf
I think of Coinbase as "cryptocurrency for people who don't believe in
cryptocurrency" so it's not surprising from that perspective.

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robertAngst
Please.

Coinbase has kept my bitcoin safe since 2011.

They also have free payments to friends with their email + shift card.

Yes their customer service sucks, but they have provided tens of thousands of
dollars in value to me.

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hapnin
I've been holding btc in paper wallets since 2011. They're easy, free and no
one has access to my btc but me.

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cbhl
How often do you spend from your paper wallet?

There are lots of paper wallet generators but it seemed like an exercise in
frustration to actually use the private key on the page to spend the money.

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hapnin
Whenever I need them.

I generate keypairs using the reference client on an offline device that never
touches a network.

Private keys can be imported and spent using almost any wallet: Coinomi,
Mycelium, the reference client, etc.

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hapnin
"Hold my private keys" has the same intellectual heft as "hold my beer and
watch this".

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gremlinsinc
This is the most poorly named venture, there's a huge political battle going
on about immigrants and custody of their children at the border, custody
itself usually goes hand in hand with 'battle'.

Having worked with foster children, trying to adopt, when they went back to a
relative, and we lost custody it was painful. Custody to MANY MANY people in
America has VERY negative connotations.

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wmf
The concept of financial custody goes back hundreds of years (although I
realize most HN readers have probably never heard of it); it doesn't make
sense to abandon that terminology over a short-lived political crisis.

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gremlinsinc
I'm sure there's many things they could call it though, that would have more
positive overtones. From a branding/marketing perspective.

Edit: For example, why not call it Coinbase Custodian? Totally different
connotation, and better name IMHO.

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JumpCrisscross
> _why not call it Coinbase Custodian?_

"Coinbase Custody" tells me exactly what they're doing. "Coinbase Custodian"
makes me think they're launching a janitorial service.

