In a YouTube video released on 3 July 2023, prominent crypto influencer and educator Layah Heilpern sheds light on the intriguing case of the alleged seizure (by Romanian authorities) of former professional kickboxer Andrew Tate’s Bitcoin holdings.
Heilpern begins by outlining the two primary ways individuals can hold their Bitcoin: leaving it on a centralized exchange like Coinbase or Binance, or taking self-custody by storing it in a hardware or software wallet. The key difference lies in who controls the private keys and, thus, the Bitcoin. In the case of a centralized exchange, the company has control, while in self-custody, the individual has control.
Heilpern suggests that Andrew Tate may have left his Bitcoin on a centralized exchange, where he would have had to identify himself through a Know Your Customer (KYC) process. If this were the case, the government could have ordered the exchange to freeze or shut down his account, effectively seizing his Bitcoin. This is because these exchanges, as regulated entities, must comply with the laws of the countries in which they operate.
Alternatively, Tate could have taken self-custody of his Bitcoin, storing it in a software wallet on his phone or a hardware wallet. If he had used a software wallet, the government could have seized his phone or laptop, gaining access to his funds. However, if he used a hardware wallet, his Bitcoin would be secure and inaccessible to the government unless he made his ownership public.
Heilpern speculates that Tate likely had some Bitcoin on a centralized exchange, which the Romanian government could have seized, and some in a software wallet on his phone, which would also have been vulnerable to seizure. However, she also believes that being a savvy individual, Tate had probably stored some of his Bitcoin in a hardware wallet, which would be safe from government intervention.
While self-custody offers anonymity, Heilpern warns that governments can hire experts to analyze the blockchain and trace wallets back to their owners. They can then blacklist suspected addresses, making it difficult for the owner to send their Bitcoin to a centralized exchange.
Heilpern concludes by recommending the use of a hardware wallet, specifically mentioning Tangem, for secure Bitcoin storage.
https://youtube.com/watch?v=N9DQ93F7ECo%3Ffeature%3Doembed
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