Let’s begin with the question, “Do your bitcoins actually exist?”
The obvious may seem like “Yes,” but the brewing “Proof of Keys” movement argues the answer is not so clear.
How a person is of his coins relies on where and how the bitcoin is stored. So participants will be taking their money out of the 3rd party bitcoin services, moving to the accounts only they control themselves.
A Proof of Keys leader and bitcoin podcast host, Trace Mayer, announced in a video –
“We’re going to withdraw all our bitcoin from any third party services just to prove that they’re there. It’s on the blockchain or it didn’t happen.”
As explained by Mayer, the motivation is simple.
Many people who own bitcoins leave their coins on exchanges, which is risky, as million or billions of dollars have been stolen from the exchanges by hackers over the years.
Now, that simply means that users don’t really have full control over their hard earned money.
You May Also Read: How to Mine Cardano?
Here Comes the Proof of Keys Part
Proof of Keys often referred to Bitcoin’s first planned “Bank Run,” where a flood of people withdraw their money from a bank, getting worried that the institution is going under. But this, unlike old-fashioned runs, is pre-planned and deliberate.
If plenty of individuals pull their money off the exchanges, then it will expose and perhaps topple the ones which are operating like fractional-reserve banks.
Big names of the industry have already etched the Proof of Keys symbol prominently in their Twitter profiles. Not just that, even Bitcoin companies like Casa and Shapeshift have thrown shown their support behind the effort.
Taking Full Control with Proof of Keys
In this way, what do participants have to do is something that depends on the user’s point of view.
The first think is for the users to take complete control of their private keys. While bitcoin is trustless, a number of its users hand their bitcoin to a third party who takes care of it.
The risk is, in case this service is hacked, then all their bitcoins are lost.
The Proof of Keys advocates argue that users have to move their private keys to a device, like a secure hardware wallet, where they literally have full control of their money.
Another job for the users is to spin up, that keeps a history of every transaction ever made on bitcoin, and the rules binding teh global network together.
This way, they can validate which transactions are following the rules and which are not, without relying on anyone else.
If this is something that sounds like a mouthful, then a few users have dependly done it, while posting their results to Twitter. In response, the advocates argue that learning experience is worth it.
Mayer adds –
“Anyone who doesn’t want you to hold your own private keys — they’re your monetary enemy. They don’t want you to be free and independent with your money. That’s just the way it is.”
You May Also Read: Bitcoin Satoshi Vision
War Cry vs Camaraderie
You may be wondering, in what way it will influence the transaction?
One of the confusing aspect is that not everyone is participating in this. A few users have been taking control of their keys which leads up to today, posting their results on social media channels.
Moreover, it will be very difficult to track how much of the community shifts over. As mayer argued, “Really, it is an intensely personal type of activity which will be hard to measure.”
But, some users call Proof of Keys as “Bitcoin’s independence day” and a “monetary sovereignty war-cry”.
Well, this sounds as if the end goal, for all cryptocurrency users, is to move promptly move their keys to a device they control and spin up full nodes on fancy hardware device, which makes bitcoin exchanges all but obsolete.
But Mayer is anticipating the result to be less subversive – and more of a bonding experience.
Mayer stated –
“I think most companies and individuals will operate normally with no significant interruptions, the bitcoin network will be strengthened in its decentralization properties, and many individuals and the community will have a sense of accomplishment and camaraderie.”
And other Proof of Keys advocates admit that a lot of users cherish convenience, not essentially having the time or enthusiasm to store their bitcoin’s and spin up a full node securely.
Here are a Few Articles for you to Read Next: