Why Use Goldilock to Store Cryptocurrency?steemCreated with Sketch.

in crypto •  last year  (edited)

Introduction

Goldilock is a new service to make holding and storing cryptocurrency. They claim they will solve major security issues by how they will store the currency and information. This article will go over what the Goldilock service is and how it works.


goldilock_logo.gif
Picture from Goldilock homepage

Let's Consider Ways We Can Store Cryptocurrency

So why does a service like Goldilock even matter? One of the important features about blockchain related currencies that you can store it yourself and just about however you want right?

Yes, this is true, and the fact that no go-between is required to receive and send currency is a huge plus for me. While I have no problem holding a bank account or using a big payment processor like PayPal I would be happy for some day I can hold my money in cryptocurrency coins.

Well, the thing is when you are your own bank so to speak a lot of security and responsibility comes with that. So let us consider our options.

You could keep all of your cryptocurrency on a website like Coinbase or other currency exchanges. Now your money is safe as the security provided by the company. Is this safe? Well, there have been some big hacks to cryptocurrency exchanges in the past. I also see plenty of trusted people in the cryptocurrency world recommend against storing huge amounts of money in such places. They refer to cryptocurrency stored here as hot money. I personally only store small amounts of currency here and whatever I needed to be exchanged.

You could use an online wallet as well. Well, now you still have some of the same issues mentioned before. If the service holding your wallet gets attacked, you may lose your currency.

So maybe we consider cold storage options then. That is ways to store our cryptocurrency physically and offline.

Well, we could consider printing out a good old-fashioned paper wallet. For most people, this is about secure as it gets. The only drawbacks I can think of is making sure you don't lose the paper holding all your money! You also have to keep in mind paper doesn't last forever, and this could be an issue.

Maybe we could use a hardware wallet? This is a more durable offline storage method. I honestly would probably use this option for storing some amounts of cryptocurrency. It seems to be a great option.

But one huge issue with both hardware and paper wallets is not we are almost back to keeping our money is in a safe or hidden in the house. Cold storage can be destroyed or stolen. These types of storage can also be forgotten or left behind in a move. The burden is on you to keep track of everything.

So back to Goldilock. What do they offer that other methods do not?

How Goldilock Stores Your Cryptocurrency

Goldilock uses what I would describe as a hybrid between online and offline wallets. Your currency and information are stored with them. They only ever connect your account online when you need to access it, and for the rest of the time, your account is offline.

You use LOCK tokens to access your account. You can find out how this system works more in depth by reading their whitepaper.

Why Use Goldilock?

The system provided by Goldilock assuming everything works as planned would be a very secure system. You get the advantages of the security of an offline wallet while still being able to access your account when and where you need it.

Another thing to keep in mind as well is since they are the ones protecting and securing your account this is not something you have to worry as much about anymore. This is assuming you have trust in the Goldilock system of course as it is a system just like any other.

So overall the advantages Goldilock provides are security and instant availability.

Would I Use Goldilock?

I would only use Goldilock to store large amounts of cryptocurrency. I think smaller amounts in the hundreds or maybe even thousands of dollars are OK to put on a cold wallet. Now once we start getting into thousands of dollars worth of cryptocurrency, I would consider using Goldilock.

For now, though I only have pocket change amounts of cryptocurrency. Nothing I wouldn't just toss on my Coinbase account or an online wallet. I do want to get a good hardware wallet in the future for more long-term storage.

So yes I would consider using Goldilock in the future if I felt like I had a need to do so.

Links to Learn More About Goldilock

Disclaimer

I wrote this article to be included in a contest. An @originalworks contest to be precise. Here is the contest post.

Use this information to judge this work as you see fit. Also, keep in mind I am not an investor, and this article holds my personal views only.

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Pretty cool. I haven't heard of it before. Gold I lock my coins.

It's still in the works, we'll see how it pans out when it finally launches :) I'd use it if it can hold multi-coins.

This post has been submitted for the @OriginalWorks Sponsored Writing Contest!
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Goldilocks, it's just right!

I did think of that when I first saw their name. Thanks for reading.

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