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210 sats \ 10 replies \ @k00b 8h \ on: Cashu vs custodial Lightning bitcoin
Better privacy because no accounts and no accounts means bearer auth and bearer auth means you approximately get the UX complexities of non-custodial onchain bitcoin usage (lose your auth, lose your money). And it’s custodial, so it has the normal risks associated with that (except that they can’t discriminate between users so when they rug or KYC they have to do it to everyone). It also shares one of the nice features of custodial bitcoin services: either the sender or receiver can be offline to conduct a payment. It also shares one of the worst features of custodial bitcoin services: unless the service has millions of dollars of licenses and KYCs its customers, it’s illegal to run a mint that serves any customer located in a majority of the countries (by population) on earth.*
*it’s possible federated mints are in a grey enough area that they might win in court battles though
This pretty much nails it. Here it is as a table in case it's easier to compare
| feature | ecash | custodial lightning |
|---|---|---|
| can be rugged | yes | yes |
| can recover from lost keys | no | yes |
| can get your account closed | no | yes |
| can receive offline | yes | yes |
| is illegal in US/EU | yes | yes |
| privacy from outside observers | yes | yes |
| privacy from mint/custodian | kinda | no |
The only nuance I would add is that since many of ecash wallets support use of multiple mints, it is easier to use multiple custodians at once (you can have a unified balance, while using ecash tokens from multiple different mints).
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On the
can be rugged bit.I think it's important to nuance the effect of ecash having no concept of identity.
A regular custodian, like Wallet of Satoshi, can decide to rug YOU specifically and intentionally. The cops can come over and say: "we don't like this john@doe.com, freeze him", and WoS would be able to do it.
On the other hand, while an ecash mint can rug you, it can only...
- Rug EVERYONE (basically stop working).
- Rug people randomly here and there. ... but they can't rug YOU specifically.
I think this changes the game theory around the custodian relationship quite a bit and has serious implications regarding how government may relate to a normal custodian vs an ecash mint.
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That's true. But if they're going to ask that to everybody, it's pretty much the "rug EVERYONE" scenario, only with the fact that they forgive you if you surrender.
Having said that, it feels convoluted. Let's add an extra layer to our stack to avoid accounts... so we can then make accounts?
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When you say 'illegal', I guess you mean that running a mint is likely illegal in much of the world? While simply being a user is legal in more places?
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Are there meaningful fee differences between the two? For example Wallet of Satoshi vs. something like Minibits?
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Coinos accounts are private if you use VPN.
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