Post
Topic
Board Bitcoin Discussion
Merits 4 from 2 users
Re: German Bank announces to support Bitcoin; says it's important to own private key
by
1miau
on 31/12/2021, 01:48:42 UTC
⭐ Merited by pooya87 (2) ,BlackHatCoiner (2)
4 is very interesting too but for usability the bank may also want to control (or at the very least) store backups of the private keys they issue their customers.
I read the article completely. It seems that they won't store users private keys and will let them to be the only and the real owner of their fund.

From the translated version of the article shared by 1miau (done by google translator):
Quote
The customer manages his private key himself, we have no way of accessing his Bitcoin, and so we do not store it.
That's also my impression from their description so far, that only the customer has access to his BTC but I don't know because it's not finalized yet and how it'll be implemented in detail.

Especially how it will look like when people buy BTC, there needs to be some centralized wallet and after that, the bought BTC will be sent to the address owned by the customer.
At least such a procedure would be normal.




A good question is:  Why would a bank want to give the option to their customers to hold bitcoin themselves? Isn't it against the whole point of a bank? I mean it's fine if they announce that they keep reserves in bitcoin, but why promoting it as a currency if it makes your business poorer?

It's not uncommon for Volksbanken Raiffeisenbanken / Sparkasse in Germany because their business model is indeed very decentralized. It's called Genossenschaftsbank in Germany, somehow comparable to Cooperative banking. And in Germany, there are many partially independant, local branches (like for that Example Bayern Mitte (middle Bavaria)) and such banks are very customer friendly.

By selling / converting BTC, the bank would still make a profit and the article also mentions to sell education-courses for customers interested in Bitcoin (most likely inlcuding informational material).

After all, it's possible, that the bank and the customer end up having a profit.