I have recently received several offers for different transactions and options through blockchain. Here i would like to identify the threats of these transactions. The usual rule is that if a deal is too good to be true it is.
Your only access to the blockchain and its applications it through/with private key. The private key is the core and only access to your blockchain address (wallet) and it is created simultaneously when the wallet is created.
The buyer’s proposal of crypto purchase procedure (we are the seller):
- The buyer creates the wallet for the seller and gives its password to the seller .
- The seller can change the wallet password and can create 2fa (two factor authentication) on it.
- The seller sends his crypto assets to his (created) wallet.
- The buyer pays for crypto assets.
Once someone else creates the wallet for you, your trust is in that person or entity, since that person or entity has seen and stored the private key!
Passwords and 2fa are just an easy way to access the wallet when the private key was already created and stored safely on your mobile device for example.
If another person has seen your private key that person can have full access to your wallet. The private key cannot be changed or altered like we are used to with passwords and emails and so on. You are the only one that should create a wallet and see/store the private key!
We allow the exchanges or other institutions to create a wallet for us because at the same time we are putting the trust in these institutions and the regulation of these institutions.
In above proposal buyer is the person that we don’t trust and want to create a secure transaction. Such problem is resolved with a third party escrow wallet, a third party that both sides trust.
Trying to ensure that scammers don’t misuse the blockchains transparency and advantages with inexperienced users.
