Not your keys, not your bitcoin. That’s the message the inaugural Proof of Keys movement hopes to promote on the 10-year anniversary of Bitcoin’s genesis block on January 3rd.
The campaign aims to encourage users that are storing crypto with third-party exchanges/wallets to send their funds to a local wallet where the user possess their own private key and has garnered key support from community stakeholders across social media:
Tomorrow is #ProofOfKeys-Jan 3 on 10th anniv of #Bitcoin’s genesis block. If someone else has your priv keys do you know if your #BTC is really there? No. Declare your monetary sovereignty by holding your private keys #notyourkeysnotyourbitcoin @TraceMayer https://t.co/TYk73D0x2W
— Caitlin Long [Jan/3➞₿∎] (@CaitlinLong_) January 2, 2019
Tomorrow is the 10th anniversary of Bitcoin’s Genesis Block. On that day, many will be doing #ProofOfKeys, which means sending your crypto from an exchange to a local wallet (and back, if you want). Learning how to do this will teach you about private keys & monetary sovereignty.
— Balaji S. Srinivasan [Jan/3 ] (@balajis) January 2, 2019
Proof of Keys aims to educate and audit
When a third party exchange holds your funds, you have to trust that they can securely manage your assets (from both hacks and be faithful with your deposits). Proof of Keys hopes to serve as a reminder that Bitcoin was created to avoid this issue through financial sovereignty, promoting education around properly securing crypto on local wallets connected to user controlled private keys.
Moreover, promoting the one-day withdrawal of assets off exchanges can also act as a stress test on third-party exchange solvency, should enough users participate in the campaign. Considering The Block’s recent report that ~70% of reported volumes are wash traded, this indirect audit on exchange deposits can be a prudent accountability check to ensure exchanges are adequately reporting user deposits on the balance sheet.
Monitoring the impact from Proof of Keys
According to Coinmetrics, 7-day average Bitcoin exchange volume has come down 25% since Dec 26th (just under $5B), but it’s hard to say how much, if any, the looming Proof of Keys initiative has impacted trading volumes. Meanwhile, it’ll be interesting to see which exchanges can’t comply with withdrawal requests, as reports from HitBTC users surfaced earlier today on Reddit mentioning the inability to withdraw funds over the last 24 hours – though the timing for HitBTC could be coincidental.
Source: Coinmetrics, The Block
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Inaugural ‘Proof of Keys’ campaign set for Bitcoin’s genesis 10-year anniversary written by The Block @ https://www.theblockcrypto.com/2019/01/02/inaugural-proof-of-keys-campaign-set-for-bitcoins-genesis-10-year-anniversary/ January 3, 2019 The Block