Can Bitcoin Account Be Frozen or Locked?
Can bitcoin account be frozen is a popular query by people planning to enter the Crypto sphere. Honestly, why should they hesitate to look for it when such a scenario can cause loss of funds. Bitcoin is a decentralized Cryptocurrency and works via a peer-to-peer network. It eliminates the need for third-party to transfer funds from one person to the other.
Instead, Bitcoin runs on Blockchain technology through which transactions take place. Blockchain is a big ledger containing all the transaction made on the Bitcoin network. Miners process these transactions and validate it to confirm the transfer of Bitcoin between address. If interested, here is a comprehensive guide on Bitcoin Mining.
Back in the early days, people would need to install the Bitcoin-QT wallet on their desktop to open a Bitcoin account and get an address. However, things evolve with the rise in demand and popularity of Cryptocurrency. Companies and startups wanted to make it easier for people willing to buy, trade or store Bitcoins.
As a fact, most of us wouldn’t want to download the QT wallet and synchronized the whole Bitcoin Blockchain. The size of the Bitcoin blockchain is also ever increasing. As at the time of this post the size of Bitcoin blockchain is over 220,000 Megabytes! This is a lot of space to open a Bitcoin account.
Can Bitcoin Account Be Frozen?
Long story short, there are two types of Bitcoin account you can have. One can be a QT wallet and the other can be a Bitcoin account from Blockchain companies. These companies can include Coinbase, Coins.ph and many others. The benefit of opening an account with them is that you need not install and configure a QT wallet. It saves your disk space and time. However, these companies need to follow compliance such as Know Your Customers (KYC) and Anti-money Laundering (AML) policies.
For many users, this is a turnoff and for others, it can get them in hot water. Users not complying with such policies or for many others reasons can see their Bitcoin account frozen on these platforms. There are many instances where companies have locked several Bitcoin accounts. Having your Bitcoin account frozen is a nightmare for individuals and can add to an individual frustration.
However, if you are using a Bitcoin-QT wallet, then there are no chances of you running into such a mishap. The reason? – Decentralization! Bitcoin enables the transfer of funds with no intermediary making it impossible to be frozen if you are running a QT client.
When you are running your QT-Client, no one is in control of your funds. But when you transfer it to Bitcoin exchanges, wallets, other services, you run a risk of getting your Bitcoin account on their platform frozen.
Bitcoin is the next financial revolution! It has many advantages over Fiat currency and has the perfect characteristics to power the global economy. However, getting a Bitcoin account might confuse many novices. In its entirety, no one can freeze your Bitcoin-QT client. Although if your Bitcoin account is on Bitcoin wallet providing companies, then there are chances for it getting frozen. Hence, it is advisable to abstain from breaching any policies on respective Bitcoin wallet service providers and avoid any trouble.