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INLOCK: Crypto Savings Account

Latest release: 1.7.5 ( 26th April 2022 ) 🔍 Last analysed 15th November 2021 . Custodial: The provider holds the keys
3.9 ★★★★★
108 ratings
1 thousand
4th August 2020

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Please help us spread the word discussing the risks of centralized custodians with INLOCK: Crypto Savings Account  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

This app’s purpose is for creating a Crypto Savings Account:

INLOCK helps to earn on your Bitcoin while you HODL it. Compounding, weekly paid out interest without hidden fees!

Because it is meant to hold users’ assets in “the long run”, the nature of this app makes it almost certainly custodial.

¡ INLOCK Savings Account service helps for those customers who hold their assets long run and want to earn some interest while lend It to other customers.

¡ All loans are protected with overcollaterization and all customer assets are store in Fireblocks Network protected by unique insurance plan. Our custody service is SOC 2 Type II certified and audited by Ernst & Young

The Site

This service has the ability to terminate users’ accounts. From the Terms and Conditions:

You understand and accept by opening your INLOCK account, Service Provider, without preliminary notification may terminate, suspend or restrict any of its customer’s account which demonstrably or reasonably suspected to violate the Terms and Conditions using inlock.io website or any INLOCK services.

It is also possible for them to cancel or stop withdrawals and deposits:

In this case Inlock have the right to stop deposits. Inlock platform also have right to cancel withdrawals when a customer want to withdraw funds to address connected to prohibited activities before.

The App

Signing into the app requires email verification. The user must also set a pin.

You are asked to enter personal information before you may withdraw or swap BTC.

Please keep in mind: no later than the first withdrawal process, you need to finish the identity verification.

There are options to deposit BTC via a Deposit Address or QR code. You can also withdraw BTC, you must add a new “withdraw address” with 2-FA enabled.

Verdict

You can store BTC in this app, as well as send and receive it. However, due to the evidence above, we conclude that it is a custodial service and as such, is 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.