B21 Crypto: Invest | Earn | SpendLatest release: 0.8.0 ( 30th January 2022 ) 🔍 Last analysed 17th 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 ¶
B21’s self-description claims that it is an app for investing, earning, and spending crypto:
B21 Crypto simplifies the entire onboarding and investment process by empowering users to create their own customised portfolio of cryptos without going through multiple “Know Your Customer” (KYC) and wallet set-up hurdles.
It also offers a VISA powered credit card, which they claim provides users an effortless way to spend crypto to make purchases online and at retail stores, and withdraw cash from any ATM globally.
Additionally, B21 includes this in their list of features in the Play Store:
Custodial Wallet to safely store the digital assets of the user
With a fully custodial and regulated model to safeguard user assets, B21 brings the process of creating and managing a multi-asset portfolio at your fingertips.
In the official FAQs, it is clearly stated that keys are on the side of the provider.
No. We eliminate the complicated process of managing the keys, wallets and provide complete custody of your assets.
From the website, the page “Custodial” reveals that Prime Trust is the custodian of securities and funds.
Account Holder(“Customer”, “you”, “your”) hereby requests and directs that Prime Trust, LLC (“Prime Trust”, “Custodian”, “we”, “our”, “us”), a Nevada chartered trust company, establish a Prime Asset Custody Account (“Account”) for and in the name of Account Holder, and to hold as custodian all assets deposited to, or collected with respect to such Account[…]
We can conclude that this is a custodial wallet, thus not verifiable.
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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