PAI - Bitcoin, Tron, Eth y másLatest release: 1.07.76 ( 19th May 2022 ) 🔍 Last analysed 23rd September 2021 . Custodial: The provider holds the keys
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Do your own research!
Try out searching for "lost bitcoins", "stole my money" or "scammers" together with the wallet's name, even if you think the wallet is generally trustworthy. For all the bigger wallets you will find accusations. Make sure you understand why they were made and if you are comfortable with the provider's reaction.
The Analysis ¶
Cursory analysis indicates that this is a business backed cryptocurrency exchange. Our tentative analysis points to a custodial service.
This app/service was formerly known as ‘Instant Payments’
We downloaded the app but had difficulty with registration since the interface is not in English. We proceeded to register via the web app and used Google Translate.
After registration, a notification appeared on top of the dashboard:
We are out of service hours. Any payment or request will be pending until support is resumed at 8:00 AM. However, those processes that do not require manual approval continue to work.
It is possible to add both bank accounts and bitcoin.
Under ‘Accounts’, we selected Add account and chose Bitcoin. Then we clicked on Add Account. We then clicked on an icon near the Bitcoin logo, which seemed to generate a QR code and a wallet address.
We then proceeded to try the exchange. We were greeted with a pop-up message:
Welcome to the cryptocurrency exchange PAI Exchange.
We are launching our cryptocurrency exchange for testing purposes, to check its correct operation before the official launch.
Clients have a balance in dollars and cryptocurrencies in each trading pair.
This non-real balance serves for testing purposes in order to make trades.
The simulated interface allowed for the buying and selling of bitcoin (BTC) against USDP. It’s a barebones order book with simple buy and sell orders.
We could not find a Terms of Service page for the app or service. We then proceeded to its social media page, where we found a video post detailing the capability of the app to receive cryptocurrencies.
A little concerning for us is the fact that PAI exchange’s latest fb social media post was made in January 4, 2021, where it linked to a Google Form that seems to indicate regulatory pressures on the service. Included in the form is a text which we translated:
As we all know, Banks have a war with cryptocurrencies (For fear of being replaced) this to the point of taking us to the extreme of having to adopt a new mode of commerce, we are currently working on the development of it, where you can buy and sell cryptocurrencies to other users of our platform, with balance or PAI balance, where we will provide the security and guarantee of a fair and successful trade, taking user verification measures, assistance or support and a record time in delivery of your purchases or sales, in addition the purchase or sale will not be executed until the moment that both parties, both buyer and seller confirm the receipt of the funds, guaranteeing a safe trade for all. What do you think about this new modality?
The lack of activity (the last update for the app was February 21, 2021) lends us to believe that this app is close to being defunct or stale. Since it can still be downloaded, plus a few indications of a custodial service, we would tentatively be labelling this app as custodial and therefore, not verifiable until further information arises.
As the provider of this product holds the keys, verifiability of the product is not relevant to the security of the funds!
As part of our Methodology, we ask:Is the product self-custodial? If not, we tag it Custodial!
A custodial service is a service where the funds are held by a third party like the provider. The custodial service can at any point steal all the funds of all the users at their discretion. Our investigations stop there.
Some services might claim their setup is super secure, that they don’t actually have access to the funds, or that the access is shared between multiple parties. For our evaluation of it being a wallet, these details are irrelevant. They might be a trustworthy Bitcoin bank and they might be a better fit for certain users than being your own bank but our investigation still stops there as we are only interested in wallets.
Products that claim to be non-custodial but feature custodial accounts without very clearly marking those as custodial are also considered “custodial” as a whole to avoid misguiding users that follow our assessment.
This verdict means that the provider might or might not publish source code and maybe it is even possible to reproduce the build from the source code but as it is custodial, the provider already has control over the funds, so it is not a wallet where you would be in exclusive control of your funds.
We have to acknowledge that a huge majority of Bitcoiners are currently using custodial Bitcoin banks. If you do, please:
- Do your own research if the provider is trust-worthy!
- Check if you know at least enough about them so you can sue them when you have to!
- Check if the provider is under a jurisdiction that will allow them to release your funds when you need them?
- Check if the provider is taking security measures proportional to the amount of funds secured? If they have a million users and don’t use cold storage, that hot wallet is a million times more valuable for hackers to attack. A million times more effort will be taken by hackers to infiltrate their security systems.
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