Tracking Bitcoin news and the incredible adoption of Bitcoins! This question originally appeared on Quora, and was answered by Bitcoin cloud storage O’Brien, owner of On Bitcoin.
Q: Which site is best for keeping a cloud bitcoin account? Sadly, the answer is none of them at this time. But there are some exciting new companies on the horizon. Each has its own profile for security and liquidity. Wallets and exchanges that are easier to use are often less secure.
This is not a rule, just the current state of affairs. The biggest risk to Bitcoin is theft. If someone gets your private key, you will be robbed. Gox Attack Pillages Investor’s Bitcoin Account as an example of how a Java chat applet was used to pillage a Mt. BTC, both as a hedge on currency volatility and because other institutions have delays, e.
There is also regulatory risk and perceived regulatory risk. For example, Tradehill recently suspended its exchange due to regulatory concerns, Mt. Gox froze USD withdrawals, and Dwolla cut off Bitcoin users. Never keep a large amount of money in an single Bitcoin wallet. Some Bitcoiners would say a single wallet should be used only once and not hold more money than you would be comfortable losing in a theft. If you are amassing BTC as an investment rather than day trading or buying and spending, consider cold storage. Keep on top of your account security like you would at your bank.