I alluded to a potential solution in
a prior post, but I guess I didn't make it explicit enough to gain attention.
On this issue of having accounts to pay with instead of use BTC base money (i.e. cash), I already pointed out upthread that if I must have a zillion separate accounts, it is going to drive me crazy. I already have too many accounts on the internet to keep track of.
Instead a dominant set of providers would take over and we are right back to VISA, Mastercard, and Paypal again. Nothing gained. Why did we waste our fucking time inventing Bitcoin then.
So I entirely disagree that we need accounts for most things. We can build services that operate on the block chain without needing store funds in an account for those services. We can pay as we go, utilizing the block chain. This is the future.
We need less overhead in our lives, not more. Accounts are proliferated overhead and/or centralizing. We need decentralized freedom.
Also if accounts are holding our balances then they will naturally end up leveraged, i.e. fractional reserves. This is a repeating phenomenon throughout the history of man. We needed accounts when base money was gold, but we don't need them now. Our technology has improved. Money is no longer physical.
To backup our keys without giving a masterkey to a coinbase, we need to have physical copies of backups. Use a Print key or copy to removable memory card. Your software should tell you when to print/copy and store in your physical safe. If you find it more convenient and safe to have coinbase hold your masterkey, then you are giving up your anonymity because they will need to identify you if ever you lose your password. The website services should operate on the blockchain and not create accounts. Period.
The back-end process should be
P2P decentralized exchange.
Naive users will go to website services, because they want Bitcoin to work like Facebook. They don't know or care what is happening behind the scenes.