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Metal Pay: Buy & Sell Crypto

Latest release: 2.6.17-prod ( 25th October 2022 ) 🔍 Last analysed 21st October 2021 . Custodial: The provider holds the keys
3.8 ★★★★★
564 ratings
50 thousand
14th January 2020

Jump to verdict 

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Please help us spread the word discussing the risks of centralized custodians with Metal Pay: Buy & Sell Crypto  via their Twitter!

Do your own research!

Try out searching for "lost bitcoins", "stole my money" or "scammers" together with the wallet's name, even if you think the wallet is generally trustworthy. For all the bigger wallets you will find accusations. Make sure you understand why they were made and if you are comfortable with the provider's reaction.

If you find something we should include, you can create an issue or edit this analysis yourself and create a merge request for your changes.

The Analysis 

App Description

Trade over 40 of the most popular cryptocurrencies directly from the app. Just link your bank, add cash to your account, and start trading. All cash you add or receive is held in an FDIC-insured bank account in our partner bank.

The Site

Terms and Conditions

Custody, Control and Access to Financial Information

We do not have or retain direct custody or control over funds or virtual currency in your Metal Pay Account, nor do we directly exchange or transmit funds or virtual currency to or from your Metal Pay Account. Banking services, including holding, exchanging, and transferring funds or to and from your Metal Pay Account are provided by Evolve Bank & Trust (“Bank”) through our agreement with Synapse Financial Technologies, Inc. (“Synapse FI”). Synapse FI acts as an agent for Bank. Bank has established a custodial account for the benefit of our customers for which Synapse FI maintains a sub-account ledger (“Custodial Account”). Bank will also establish a demand deposit account in the name of each Metal Pay Service user (“DDA”). Whether your funds are placed in the Custodial Account or a DDA depends on your state of residence and applicable laws in that state. We create sub-accounts for you with our payment vendor Synapse FI in order to process USD deposits and withdrawals. All services provided by Bank and Synapse FI are subject to the applicable account agreement, the Synapse Terms of Service, privacy policies, and other applicable agreements and disclosures, all available at https://synapsefi.com/legal and https://synapsefi.com/evolve-privacy. By using the Metal Pay Service, you agree to such agreements, policies, disclosures, and terms of service. Funds in the Custodial Account and DDA are FDIC insured by our bank partner up to applicable statutory limits (currently $250,000) for each deposit account. To report complaints regarding Bank or with the services provided by Synapse FI, email issues@synapsefi.com. All virtual currency in your Metal Pay Account is held and exchanged, and transferred to and from your Metal Pay Account, by our virtual currency exchange partner.

Verdict

As the terms and conditions state above, this service uses other services to provide custody for the users’ cryptocurrency assets. This makes the app not verifiable.

(dg)

Verdict Explained

As the provider of this product holds the keys, verifiability of the product is not relevant to the security of the funds!

As part of our Methodology, we ask:

Custodial!

Is the product self-custodial?

If the answer is "no", we mark it as "Custodial: The provider holds the keys".

A custodial service is a service where the funds are held by a third party like the provider. The custodial service can at any point steal all the funds of all the users at their discretion. Our investigations stop there.

Some services might claim their setup is super secure, that they don’t actually have access to the funds, or that the access is shared between multiple parties. For our evaluation of it being a wallet, these details are irrelevant. They might be a trustworthy Bitcoin bank and they might be a better fit for certain users than being your own bank but our investigation still stops there as we are only interested in wallets.

Products that claim to be non-custodial but feature custodial accounts without very clearly marking those as custodial are also considered “custodial” as a whole to avoid misguiding users that follow our assessment.

This verdict means that the provider might or might not publish source code and maybe it is even possible to reproduce the build from the source code but as it is custodial, the provider already has control over the funds, so it is not a wallet where you would be in exclusive control of your funds.

We have to acknowledge that a huge majority of Bitcoiners are currently using custodial Bitcoin banks. If you do, please:

  • Do your own research if the provider is trust-worthy!
  • Check if you know at least enough about them so you can sue them when you have to!
  • Check if the provider is under a jurisdiction that will allow them to release your funds when you need them?
  • Check if the provider is taking security measures proportional to the amount of funds secured? If they have a million users and don’t use cold storage, that hot wallet is a million times more valuable for hackers to attack. A million times more effort will be taken by hackers to infiltrate their security systems.
The product cannot be independently verified. If the provider puts your funds at risk on purpose or by accident, you will probably not know about the issue before people start losing money. If the provider is more criminally inclined he might have collected all the backups of all the wallets, ready to be emptied at the press of a button. The product might have a formidable track record but out of distress or change in management turns out to be evil from some point on, with nobody outside ever knowing before it is too late.