Proof of Keys Event May Highlight Centralization of Crypto, but Some of Its Claims Are Unfounded

Bitcoin celebrated its 10th birthday on Jan. 3, and in commemoration of this milestone, the very first Proof of Keys event was held. Organized by crypto investor and podcast host Trace Mayer, it urged cryptocurrency traders to withdraw their holdings from crypto exchanges, in order to promote the decentralization and monetary independence on which Satoshi Nakamoto’s vision for Bitcoin was founded.

However, as ostensibly positive as its message was, it was claimed on social media in the days leading up to the event that several exchanges — most notably HitBTC — had apparently been freezing accounts and preventing users from withdrawing their funds.

These are serious charges, but while they raise questions about who really owns the coins traded via big exchanges, the issue could be more complicated than HitBTC’s detractors would have everyone believe. For one, exchanges have a record of halting withdrawals and freezing accounts as part of their normal business, so it’s not certain that HitBTC or any other exchange was specifically opposing Proof of Keys and trying to prevent a mass reclamation of Bitcoin. And secondly, it’s worth pointing out that Proof of Keys is not a grassroots, community-led event. Rather, it’s an initiative spearheaded by entrepreneur Trace Mayer, who happens to be an investor in Armory, a crypto wallet manufacturer that obviously has a financial interest in people taking their coins out of exchanges. As such, his claims of widespread account blockages should perhaps be treated with scepticism.


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