An important question throughout the previous decade in the Bitcoin age is: Do your Bitcoins, whether they exist on an exchange, wallet or app, really exist? The answer is not obvious and the Proof of Keys event that started on January 3, is the definitive way to find the answer.
If you store your Bitcoins on an exchange or in a wallet, then you are not in complete control and its important to know what the exchange or wallet is doing with your coins. Are they moving it to accounts that they control or are they spending and investing it elsewhere? The face of this movement, Trace Mayer, PoK leader and Bitcoin Podcast host announced that to participate in this movement, all that you need to do is withdraw all your Bitcoin from a third party service just to prove that it exists. If it is on the blockchain, you’re good, and if not, then you have your answer.
Kind of mystifying, isn’t it? Does that make you nervous? It probably should.
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Why Proof of Keys?
Most Bitcoiners are known to leave their Bitcoin on exchanges and in wallets and this is how it gets stolen during hacks. Many of them are not even aware of how they have little or no control over their assets. This movement is also synced with Bitcoin’s 10th anniversary of its first block.
Proof of Keys has been compared to a “bank run,” in which almost every user withdraws funds, afraid that the bank may collapse, but there is a clear distinction here, and this is not a crisis. It is a well-planned and orchestrated event. If more Bitcoiners pull out their funds, fake exchanges and scams will be exposed faster than ever. Influencers like Caitlin Long, Nick Szabo, Coinbase CTO Balaji S. Srinivasan, and CoinKite CEO Rodolfo Novak have all etched the Proof of Keys symbol prominently in their Twitter profiles. Do you want to take part in this movement?
All you’ve got to do is withdraw your Bitcoin from exchanges and private wallets. And spread this message on social media, with others on Crypto Twitter. “Proof of Keys” advocates argue users need to move their private keys to a device, such as a secure hardware wallet, where they actually have full control of their money.
Once you move your Bitcoin, check the ledger for transactions. If you find your transaction, your assets are safe, however if you don’t, then the exchange or the platform that you withdrew from may be a sham. You aren’t alone in this. Many users have already done it, posting their results to Twitter. Though it may take up your precious time and the fee you pay to the network for withdrawal, you will know for sure, what’s the state of your Bitcoin.
Private keys were created for users to save securely and not share, however exchanges control wallets and that makes them your immediate enemy, in case they suffer a hack.
Risks involved
- I’d like to caution users that there are risks involved in withdrawing funds. If you withdraw funds and don’t store them properly, you may lose them forever.
- There is no fixed date for the event and this is getting confusing for people joining the movement now, as some are withdrawing funds, while others are depositing it.
- PoK was to be Bitcoin’s Birthday on January 3rd but the end goal may never be met if there is no surefire deadline. An en masse exit may also make smaller Bitcoin exchanges and wallets obsolete.
This movement is acting like the great awakening for most participants and Bitcoiners. Part of the movement is teaching people how to set up a full node, deposit and withdraw Bitcoin and store assets securely.
Are you part of the movement? Do you think PoK will affect the Bitcoin price? We’d love to hear from you.
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