04 May 2023 16:41, UTC
Reading time: ~2 m
CakeDeFi CEO Julian Hosp took to Twitter earlier today to post a video titled ‘The Shocking Truth About most Cryptocurrency Custody Providers.’ In the one-minute-long video, Hosp explained the concept of cryptographic pressure and why he believes custody providers cannot all be trusted.
The Shocking Truth About most Cryptocurrency Custody Providers pic.twitter.com/7wEktJxsQA
— Dr. Julian Hosp (@julianhosp) May 4, 2023
Hosp’s short clip, which seems to be cut out of a longer video, begins with him asking his users to imagine a scenario wherein the AWS causes issues. “If the AWS causes issues, you need to be able to leave like this,” said Hosp snapping his fingers. “And you need to be able to switch to something else. And if you can’t do that, you’re tied in. You’re going to be offline, and you’re going to be done. And that is a cryptographic pressure.”
Explaining the concept further, Hosp elaborated that cryptographic pressure is when the US goes to the two large custody providers, Bitgo or Fireblocks, and starts pressuring them. Hosp’s video implies that when in such cases of pressure, custody providers might block users from accessing their assets. “In that instance, you know what, give me the keys, and I have the possibility to get access to that. Even if they think I don’t have access,” he added.
Hosp asserted that if users want to work with a custody provider, they must have very viable cryptographic proofs. “Because then suddenly you have to trust and you cannot verify this yourself,” said the CEO.
Some of his followers, however, were not impressed with this new insight. One particular user called him a conspiracy theorist who once used to create good content. It is also interesting to note that Hosp ended his thread by adding that a provider Hosp personally trusts is Levain Tech.
Sourced from cryptonews.net.