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14 votes
Accepted

Why do bitcoin exchanges use "central" wallets?

Note: This answer applies to Bitcoin, not "crypto" generically. On terminology I think you may be conflating "wallets" and "addresses". Addresses are used to communicate ...
Murch's user avatar
  • 75.7k
5 votes
Accepted

What happens to my bitcoins if a hard fork occurs?

Technically, the UASF that will go live on August 1st isn't a hardfork (see What is the User Activated Softfork (UASF) proposal? How do its risks compare to hardforks?), but it may have still have a ...
morsecoder's user avatar
  • 14.2k
4 votes
Accepted

What is the risk involved in fedimint?

If implemented as described, Fedimint implements Chaumian E-Cash operated by a Federation. When users deposit funds, the Federation takes custody of the deposit. In return, the Federation issues ...
Murch's user avatar
  • 75.7k
3 votes
Accepted

Hosting lightning node and non-custodial

Unlike layer 1, keys are not needed in order to perform transactions, which means that you are not only trusting the information the node is providing, also they could perform transactions without ...
Mark H's user avatar
  • 3,334
2 votes
Accepted

How do exchanges such as coinbase handle off-chain transactions?

Yes, exchanges tend to have huge cold wallet where they amass and send most of their bitcoins ( you can even follow those addresses by each exchange on the top 100 richest bitcoin addresses ) When a ...
Saxtheowl's user avatar
  • 2,800
2 votes

What is the risk involved in fedimint?

Fedimint has a doc on this. Clearly there is a trade-off from self custody onchain but community custody is not the same as leaving your funds on a large (generally KYC) centralized exchange from ...
Michael Folkson's user avatar
2 votes

Why do bitcoin exchanges use "central" wallets?

The Omniwallets mentioned in the previous answer can be thought of as a form of limited-scope L2 (second-layer) payment network, albeit one with much more required trust than a decentralized global L2 ...
Larry Ruane's user avatar
1 vote
Accepted

Do I have to backup ~/.cashu/wallet/wallet.sqlite3 of my nutshell wallet in order to backup my ecash tokens?

After experimentation that included deleting .cashu/ I can confirm that I am able to restore the funds just from the mnemonic phrase.
John Smith's user avatar
1 vote

How to buy BTC with a non custodial wallet directly?

A (self-custodial┬╣) Bitcoin wallet chiefly manages your private keys, tracks your spendable funds, and keeps a record of Bitcoin transactions relevant to you. Buying bitcoins requires finding a seller,...
Murch's user avatar
  • 75.7k
1 vote

How to hold a fiduciary accountable?

Traditionally there is no definitive way to determine which addresses belong to which wallets, so you can't know the opening balance for sure. However.. In the case that the wallet is a hierarchical ...
Conrad's user avatar
  • 21
1 vote

Hosting lightning node and non-custodial

I think you refer to those wallets (which some people refer to as remote controls) which run a lightning node somewhere in the cloud (it could be your own raspiblitz server at home) and provide an app ...
Rene Pickhardt's user avatar
1 vote

How to create multi-user wallet or wallets supporting off-chain transactions

The case 1 is easy from a technical perspective: you create a single hierarchical deterministic wallet and take full custody of your users' balances. To do so, you provide distinct addresses to each ...
Murch's user avatar
  • 75.7k

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