https://steemit.com/bitcoin/@nastrom/us-secret-service-seized-a-coinbase-user-over-25-bitcoins
This article highlights the most dangerous aspect of cloud-based services such as coinbase and circle. You NEVER want to keep significant funds in these services. Online wallets are under heavy scrutiny. The former online wallet service coinkite, for example, shutdown their wallet functionality earlier this year due to similar pressure to comply with govt requests (among other things). That sucked because their wallet was actually really good. But, by now you should know better than to use services that are centralized and controlled by parties who are complicit with draconian measures to control your funds. Coinbase controls your private keys!
The Ideal Wallet Technology Stack
- Hardware wallet
- Software wallet
- Online wallet for transfers
- Bank account
Hardware/offline wallets are the most secure means to safeguard your bitcoin. As long as you don't give out your private key, no one can seize your funds. You won't wake up to a notice that reads, "Hi, we've just dipped our hands in your cookie jar. Kthxbye!" because there is no way for them to access your funds without your private key. This video explains this pretty well (disclaimer not my content):
https://www.khanacademy.org/economics-finance-domain/core-finance/money-and-banking/bitcoin/v/bitcoin-security-of-transaction-block-chains
But even a software wallet on your computer gives you far more control and autonomy than circle or coinbase-based accounts. Again, only you have access to your private keys. However, you have to be careful of malware, keyloggers etc. But you still won't wake up to the aforementioned note. A good wallet software to use is MSigna. Its free and very robust. Slightly confusing to use at first, but follow the instructions and you will get the hang of it.
Services like Coinbase and Circle should only be used to transfer bitcoins to USD, and even then they should be avoided. There are more and more ways to directly convert your bitcoins to USD without using circle or Coinbase. These services have to sell their souls to the devil in order to operate, and rest assured that they will NOT hesitiate to throw you under the bus when served with a warrant. Best to use a service that cannot be served. Do yourself and your wallet a favor and make the switch today! As more and more people make money on #steemit, they will want to be converting their #steem to usable cash. You don't want to use Coinbase or Circle to do this. Just say no.