Last time on Crypto & You: Legal & Safety Tips, one of the points I emphasized was that with cryptocurrency, you are now your own bank. Huge, right. Yes, quite huge. You know what they say: To whom much is given, much is expected. So as your own bank, what is expected of you? Let’s dive in right away by understanding how this works.
First, what is a bank, really?
Now that you realize that you are now your own bank, it’s understandable how one would suddenly want to be sure what a bank is again. With the banking power cryptocurrency has put at your fingertips, it’s worth understanding what it really means to be your own bank. Here we go!
A bank is a money house; a financial institution. A bank receives money in deposits and makes money through financial services. These services include facilitating payments, exchanging currency, giving loans, investing money, and even managing wealth. Imagine all that at your fingertips!
Before you start wondering if you are up to this, let’s break it down further, shall we?
With crypto, you are your own commercial/retail bank and investment bank in one swoop without a central bank.
A bank could be a commercial/retail bank and investment bank. There is no central bank.
First, as a commercial bank, you are Access Bank, GTBank, Zenith Bank, or even JPMorgan Chase. Yes, only YOU. With a crypto wallet such as a Kurecoin wallet for example, you are able to manage your deposits and withdrawals. You open and maintain for yourself an account which gives you access to financial services and enable you carry out transactions in a borderless world. There is more.
Second, apart from being your own commercial or retail bank, you are your own investment bank. You know what investment banks do, right? They specialize in complex financial transactions, including acting as intermediaries between a securities issuer and the investing public. They act as a broker or financial adviser. They raise capital, etc. Serious stuff. I know right! In the world of cryptocurrency, you are a one-man Goldman Sachs; a one-man Stanbic/IBTC. Yes, only YOU. Unbelievable? Don’t drop the barton yet. One more lap to go.
Third, there is no central bank. Absolutely. None. In the crypto world, there is no central authority functioning as reserve or monetary authority calling the shorts. Cryptocurrencies run on distributed ledger technology (DLT). Decentralization rules here. No one is king. In the peer-to-peer economy of the crypto world, cryptocurrencies such as bitcoin, Dash, or Kurecoin for examples, do not require a central bank or any bank at all. Decentralized economies do not have central monetary authorities. No financial middleman. The responsibility of managing cryptocurrency supply does not fall under any central bank’s control. No bank at all. Money supply is determined by demand and supply. So no central bank devalues the currency (as the Central Bank of Nigeria did recently), arbitrarily charges transaction rates, or determines interest rates. None. Altogether, the supply and value of your cryptocurrency is not in the hands of any central bank, reserve bank, or authority. Typically, currency supplies for cryptocurrencies are fixed, except the cryptocurrency’s protocol changes. For example, currency supply for bitcoin is only 21 million. Though there is a hot debate about this fixed supply, just understand that every bitcoin supplied is mined, just like gold is mined from the ground. Digital gold? You may put it that way.
Considering the huge banking powers in your hands, this is why at Kurecoinhub we always emphasize account security.
As your own bank, it’s vital that you always secure yourself. While the platform you use may do everything reasonably possible to keep you safe, you will be the weakest link in the security chain if you don’t also secure yourself. This is why under Kurecoinhub’s Terms and Conditions, we require that you protect your account details, including username and password. As your own bank, you have responsibility for:
safekeeping of your Kurecoinhub account and password, personal identification numbers (PINS) or tokens, API keys or any other authenticator code associated with your Kurecoinhub account;
monitoring all activities under your log-in email, Kurecoinhub account, and password;
notifying Kurecoinhub immediately if you are aware of any unauthorized access to your Kurecoinhub account and password by any person or any other violations;
enabling any additional security features available to you, including the activation of two-factor authentication (2FA) on your Kurecoinhub account. Google Authenticator is a great 2FA tool; and
maintaining security and control of your inbox, phone number and any other application linked to your Kurecoinhub account.
Quick Tips to Keep Yourself Safe
Always protect your passwords and make them really difficult. Forget your pet cat’s name or ex-girlfriend or boyfriend! This is your money we are talking about, not some Valentine’s Day gift!).
Always ensure that your private key is secured. (Never save your private key in your email. Try writing it out on a well-kept note. Disclose to no one, even if you are on your deathbed! Well you get the point!)
Enable two-factor authentication.
Avoid public WiFi. In Nigeria, we say ‘Awoof dey spoil bele’. Public WiFi are less difficult to hack.
Consider buying a cryptocurrency hardware wallet.
Beware of phishing sites. Stare clear of sites you do not trust. Sites that keep connecting to an endless line of third-party sites are suspect. Always look out for the ‘https://’ on your address bar to confirm the site is secured and encrypted.
Lastly, always send a fraction of bitcoin to my bitcoin wallet at Kurecoinhub. (Just a fraction as I’m not that greedy. Seriously! Sorry na. It was only a joke.
Next time on Crypto & You: Legal & Safety Tips with Kull, I’ll be talking about the safety tips some more. Till then, stay secured, safe, and sound!