Despite all the criticisms that come with "the banking system", banks do provide a lot of value to individuals. It is completely understandable that people would want to wrap their decentralized currency inside of a centralized system (exchanges, custodianship, IRAs, etc.) for the benefits that having a bank-like organization can provide.
This does involve using a centralized service to an extent, but the amount of trust you are asked to extend is limited. They can't unilaterally take your funds, and they can't stop you from moving them to another wallet which you fully control. At the same time, you can safely use the wallet online with the additional convenience and safeguards provided by Muun, and it would be difficult to lose your funds permanently from "one small mistake".
As I said, it's a hybrid—so it has some elements of "being your own bank" as well as elements of a custodial system. The point of the multi-sig model is to allow the wallet to be used for day-to-day transactions like a "hot" wallet or a custodial exchange without the risk of carrying the complete keys everywhere on an Internet-connected device and without giving up control over the funds. The backup and the 2-of-2 multi-sig each serve important functions; neither "defeats" the other.
> If their backup is stolen, the thief can empty their wallet.
And no one ever has their traditional bank account emptied due to poor password hygiene or a vulnerability in the bank's 2FA system? Transferring custody to a third party doesn't mean you can stop worrying about security. If you don't have something equivalent to this offline backup then it's true that there is one less way for a thief to gain access to the account, but then you risk being unable to prove that you are the authorized owner of the account and losing your funds that way.
> Not much different from using a hardware wallet in that respect.
Hardware wallets have a different set of trade-offs. Personally I don't like to carry mine around with me like a ordinary wallet (or my phone) for use in daily payments. It's probably secure enough that I could do that safely, but there's always the risk of losing it, and for small, everyday payments it's just not as convenient as using an app on your phone. Also, Muun works with the Lightning network, which requires an online component; I'm not aware of any hardware wallets which can fill that role.
Could a scam system be made that seemed to work, be advertised, and otherwise identical up until the point of failure as muun?
The biggest potential point of failure, if you installed pre-built binaries from a third party such as Google Play or the Apple App Store, is that it could be updated to a new version which leaks the wallet-side private key. Which is a potential concern with any wallet software you don't audit for yourself. Of course you're also trusting the system software provider (i.e. Google or Apple) to run the application properly, as with any software running on their respective operating systems.
Personally I trust it with funds comparable to what I would normally keep in a wallet for daily use, not a safe or a bank vault. For larger amounts where the inconvenience of cold storage is justified I use a hardware wallet (Trezor).
It's amazing how many smart people take so long to realize why banks exist.
I just had to physically cross an ocean twice because my bank won’t send wires for more than $25k via their website, and that’s one of the gentler failure modes.
Here are some examples: https://old.reddit.com/r/fatFIRE/comments/pycgjx/what_in_the...
Retail banking in the USA is terrible.
It's the reason to do the crypto part at all that's more confusing. Unless of course we all just admit that gambling is unbelievably popular and fun and has been a continued hit throughout human history.
