there are companies meeting the need for a "turnkey solution": you list Coinbase and they are an excellent example of a company doing that well and being quite successful at it.
And if Coinbase goes bankrupt, all their users lose all their money.
I've written about this extensively several times before, so I won't rehash the old points. But the summary is, if you trust your money to an entity that doesn't have insurance, you're being very, very brave. Coinbase can go bankrupt for a multitude of reasons, some of which aren't fair.
One could counter this with, "Don't store very much money in Coinbase." Sure, but then consumers don't have much money on hand to buy things on a whim, which reduces consumer adoption. That's why I've been saying: Make bitcoin safe, and adoption will follow.
> So can a bank and you will loose all your money just ask the people of Cyprus.
This is a silly comparison. In the USA, all deposits under $200k are guaranteed by the FDIC [1]. If the bank folds, you still get your money from the federal government.
I imagine many similar institutions exist in other countries.
Why there was no such institution in Cyprus baffles me. Perhaps they haven't had to deal with institutional bank failures before. The point is that deposits in Coinbase or other bitcoin institutions are not covered by any such insuring body. They are hence inherently far riskier.
It all comes down to likelihood of failure. When institutions like coinbase fail, we call that "thursday". But if the FDIC folds, you should be less worried about your money and more concerned about hoarding ammo and cigarettes.
The Cyprus banks didn't fail, the government confiscated a fraction of account balances. The FDIC guarantee wouldn't help you in that situation or many other types of national calamities.
And if Coinbase goes bankrupt, all their users lose all their money.
I've written about this extensively several times before, so I won't rehash the old points. But the summary is, if you trust your money to an entity that doesn't have insurance, you're being very, very brave. Coinbase can go bankrupt for a multitude of reasons, some of which aren't fair.
One could counter this with, "Don't store very much money in Coinbase." Sure, but then consumers don't have much money on hand to buy things on a whim, which reduces consumer adoption. That's why I've been saying: Make bitcoin safe, and adoption will follow.