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Author: Admin | 2025-04-28
And your holdings, they cannot ascertain the real-world identity behind the public key.Also Read: Everything you need to know about crypto savings accountsHowever, this changes when you need to exchange your cryptocurrency for cash or other tokens or to get a crypto debit card. You need to register with a centralised cryptocurrency exchange, decentralised application, or crypto bank for any such services. These platforms will most likely need you to complete a KYC process to take you on as a customer. By doing so, you create a link between real-world data and the public key of a wallet, which can be used to uncover details of the identity behind a wallet’s public key.Can Bitcoin be withheld?One of the most significant benefits of blockchain technology is that transaction records and personal crypto holdings cannot be tampered with or modified. This is a feature known as censorship resistance or immutability.Since blockchain technology is based on a decentralised system, no entity has control over someone’s funds or data.Therefore, on-chain tokens cannot be frozen, withheld, or modified in any way. Perhaps the only way to block a user from accessing their on-chain funds would be to shut off internet services in the vicinity.However, all this protection goes out the window when you transfer your funds to a crypto exchange, lending platform or DApp. A central authority is then involved and can freeze funds if necessary. It is a common occurrence where a centralised trading platform will freeze a user’s wallet.This often happens if the user is involved in some criminal activity. Government authorities can contact the developers to freeze a particular address. The developers blacklist the address, preventing the user from sending or receiving cryptocurrency.In some cases, the feature to blacklist an address can be misused by scammers. Usually, on decentralised exchanges, scammers can
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