📅 Original date posted:2015-01-20
📝 Original message:On Tuesday, 20 January 2015, at 10:46 am, Peter Todd wrote:
> I was talking to a lawyer with a background in finance law the other day
> and we came to a somewhat worrying conclusion: authors of Bitcoin wallet
> software probably have a custodial relationship with their users,
> especially if they use auto-update mechanisms. Unfortunately this has
> potential legal implications as custodial relationships tend to be
> pretty highly regulated.
>
> Why is this? Well, in most jurisdictions financial laws a custodial
> relationship is defined as having the ability, but not the right, to
> dispose of an asset. If you have the private keys for your users'
> bitcoins - e.g. an exchange or "online" wallet - you clearly have the
> ability to spend those bitcoins, thus you have a custodial relationship.
If you have the private keys for your users' bitcoins, then you are every bit as much the owner of those bitcoins as your users are. There is no custodial relationship, as you have both the ability and the right to spend those bitcoins. Possession of a private key is equivalent to ownership of the bitcoins controlled by that private key.
Matt Whitlock [ARCHIVE] /
npub17q…upwet
2023-06-07 15:28:47
in reply to nevent1q…xyyj
Author Public Key
npub17qxssk9sj2r7jswvh3y32e7vwz7mcckhz33gk9nurdmw0lhsfkgswupwetSeen on
wss://relay.nostr.bandPublished at
2023-06-07 15:28:47Event JSON
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"content": "📅 Original date posted:2015-01-20\n📝 Original message:On Tuesday, 20 January 2015, at 10:46 am, Peter Todd wrote:\n\u003e I was talking to a lawyer with a background in finance law the other day\n\u003e and we came to a somewhat worrying conclusion: authors of Bitcoin wallet\n\u003e software probably have a custodial relationship with their users,\n\u003e especially if they use auto-update mechanisms. Unfortunately this has\n\u003e potential legal implications as custodial relationships tend to be\n\u003e pretty highly regulated.\n\u003e \n\u003e Why is this? Well, in most jurisdictions financial laws a custodial\n\u003e relationship is defined as having the ability, but not the right, to\n\u003e dispose of an asset. If you have the private keys for your users'\n\u003e bitcoins - e.g. an exchange or \"online\" wallet - you clearly have the\n\u003e ability to spend those bitcoins, thus you have a custodial relationship.\n\nIf you have the private keys for your users' bitcoins, then you are every bit as much the owner of those bitcoins as your users are. There is no custodial relationship, as you have both the ability and the right to spend those bitcoins. Possession of a private key is equivalent to ownership of the bitcoins controlled by that private key.",
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