Is self custody getting a bit too complicated for beginners?

[Rengga Jati]

I was trying to help a friend set up their first hardware wallet yesterday, and it really hit me how intimidating this stuff has gotten. Between writing down seed phrases, managing passphrases, and explaining different address types, their eyes completely glazed over.It made me wonder, are we making security so complex that we're accidentally forcing everyday people to just leave their coins on centralized exchanges? How do we fix the user experience without sacrificing the whole not your keys, not your coins philosophy?

There are several possibilities that could happen to them when "their eyes are completely glazed over."
- They're still new to it, so they need time to learn and adjust.
- They're technologically illiterate? I don't think so.
- They're just too lazy to learn more deeply.

But, in my opinion, that's what we have to do. It's forced, but for the greater good and security (although not zero risk). Therefore, in many cases, we must be forced to understand something so that the results are much better and safer. Eventually, it won't be difficult anymore once we get used to using that non-custodial wallet.

[Alpha Marine]

What do you mean by "has become"?
Was there a time in Bitcoin's history when your security was easier than it is now? Securing your Bitcoin has been the same since its inception. Keep your seed phrase safe in a place only you can access, and don't share it with people. It's literally that simple; there's no need to overcomplicate it. A lot of people who couldn't keep their bitcoin safe in the early days lost it. The ones who lost their seed phrase lost their Bitcoin. So this is how it has always been.

Self-custody is a risk. But a risk worth taking. If you want to take control of something, you have to be ready to deal with that thing. There is a saying among farmers, "If you pray for rain, you must be ready to deal with the mud too".
If you want to take total control of your money, you have to also take total responsibility for it, and your security is a big part of that responsibility. You can't eat your cake and have it too.

[JeffBrad12]

I am using Trezor and I also have a similar experience to you in that everything is quite simple and easy. But honestly, I do not think that if I gave it to my parents or middle aged people, they would have the same experience and say it is easy for them.

ETF come to the rescue. ETF is exactly for scenario like this, for people or institutional who don't want to take care of their own bitcoin but want the price exposure.
If a person is having a hard time using hardware wallet like that, big fat chance they will face roadblock doing something else, including taking care of their self custody wallet which requires some extend of security knowledge.
At that point the risk become bigger than the benefit so I would only recommend the safest option which is ETF.

[Peanutswar]

I was trying to help a friend set up their first hardware wallet yesterday, and it really hit me how intimidating this stuff has gotten. Between writing down seed phrases, managing passphrases, and explaining different address types, their eyes completely glazed over.It made me wonder, are we making security so complex that we're accidentally forcing everyday people to just leave their coins on centralized exchanges? How do we fix the user experience without sacrificing the whole not your keys, not your coins philosophy?

Wanted to make an investment with the cryptocurrency and they have a lot of crypto and funds to buy an asset but they letting the exchange hodl their coins without having an assurance its safe. Thats how the people lazy nowadays, just basic configuration of security is they get tired to login with their hardware wallets than accessing with the exchange. Well just seen this because people wanted to make it easy access, they can now buy or sell their coins immediately depends on the stand of the market its a quick flip over but in hardware wallet you cant set a price where you will buy and sell your coins of course you need to login, then use an exchange (well some of the hardware wallet has a third-party offers exchange now to their platform) and then transfer back again to the hardware wallet.

Still ideal to have a hot and cold wallet. Hot wallet for active transactions, and cold wallet for long term hodling. Exchange is just for swapping and its not a wallet, once they vanished you no longer back your coins.

[MadSl1m]

The thread's stuck on a false choice, exchange custody or hardware-wallet seed phrases. What tripped your friend up (seed phrase, passphrase, address types) is really the old wallet model, not self-custody itself. Smart-account wallets handle recovery with a passkey or trusted contacts rather than a seed phrase you write down, and the self-custody cards built on them (Gnosis Pay, ether.fi) let someone spend straight from their own wallet without touching any of that. So a beginner can hold their own keys without the seed-phrase ritual that's pushing people back onto exchanges.

[alastantiger]

So do not see it as a threat to you, but having in full control of your wallet and secure all the safety measures that you know is the best feeling and advantage having a self-custody wallet.

This new beginners don't understand what it means to be the owner of your own bank that is why they don't understand the usefulness of being in control of your private key, non-custodial wallet are the best type of wallet and there should be no complication in using them If you take your time to learn and understand how to operate them. This new set of investors are only interested in Bitcoin because of the profit that is why they see any other thing that does not involve them making money from Bitcoin as a problem, most of them just want to use centralized wallet and hold their Bitcoin since they are holding period is short and not long but if you want to become a long term investor in Bitcoin then making use of non-custodial wallet is always the best. The benefits of non-custodial wallet are just too high that substituting them for something else is not worth it hence everybody should get acquainted with non-custodial wallet.

[Fivestar4everMVP]

I was trying to help a friend set up their first hardware wallet yesterday, and it really hit me how intimidating this stuff has gotten. Between writing down seed phrases, managing passphrases, and explaining different address types, their eyes completely glazed over.It made me wonder, are we making security so complex that we're accidentally forcing everyday people to just leave their coins on centralized exchanges? How do we fix the user experience without sacrificing the whole not your keys, not your coins philosophy?

It all depends on the wallet you choose you make use of, some hardware Wallets are very easy to setup and manage, while some are complicated in some ways.
Same applies to mobile and or desktop wallets too, some of them are hard and complicated to setup and use, while there are others that are easy and simple, so this is a matter of choice and not that being a custodian of your funds is that difficult generally.

The best way to really enjoy being in full custody of your fund is to own a hardware wallet that you can treat as cold storage where you keep funds that are long term investments, this hardware doesn't need to connect to the Internet at all until the day you decide it's time to get those funds out..
Then have a simply mobile wallet like mycelluim or a better general wallet what works for every chain like Near.com, from this wallet, you can perform all your crypto transaction and from here, you can be moving funds that invested to the hardware wallet which as been turned into a cold storage. This way, every thing becomes easy., you don't have to go through the stress of setting up a new non-custodial wallet the time.

[Dunamisx]

Maybe the use of centralized exchanges has been one of the major reasons why many could not take self-custody seriously, as some of these newbies don't even know about the past incidents of those who have lost their assets on centralized exchanges due to hacks or scams.

While some platforms also prevented them from taking their assets because they couldn't verify some information with them, a platform can also go bankrupt and these are the things I expect that we should know as new beings in cryptocurrency so that we can take non-custodial storage seriously rather than depending on custodial storage.

[retreat]

Self-custody isn't for everyone. If someone finds self-custody too much of a hassle, they can choose to use a third party to manage their Bitcoin. There's no obligation to opt for self-custody, it all comes down to each person's choice—whether they want full control over their assets or prefer to use third parties like exchanges and custodians for convenience and a simpler experience. It all depends on their own choice. If they feel that self-custody is too difficult for them, then that means they aren't ready for it.

[Abu-Naim]

I was trying to help a friend set up their first hardware wallet yesterday, and it really hit me how intimidating this stuff has gotten. Between writing down seed phrases, managing passphrases, and explaining different address types, their eyes completely glazed over.It made me wonder, are we making security so complex that we're accidentally forcing everyday people to just leave their coins on centralized exchanges? How do we fix the user experience without sacrificing the whole not your keys, not your coins philosophy?

Compare to how we want to be protected, it is nothing difficult. We have to take the responsibility of protecting our wallets ourselves so that we will be sure that our assets are safe, we can’t just decide to follow the easiest way and expose our selves to danger of easy attacks like phishing attacks, or leave our coins with exchange that will control our funds fiends.

Newbies that are already used to centralized exchanges will hardly change to non-custodial wallets easily, they will not want to take responsibility themselves to protect their wallets, they will want to have the same feelings as they used to have in centralized exchanges that’s why they feel it is too complicated to set up.

[r_victory]

I don't think it's gotten complicated; on the contrary, it's much easier nowadays than when I started. You have to pay attention, but if you don't want to write it down, save it in a file or on a flash drive, it's not complicated. Some people may disagree, and that's fine, but there's no need to overcomplicate things; that's how you end up getting even more tangled up.

[L E G E N D A R Y]

I don't think it's gotten complicated; on the contrary, it's much easier nowadays than when I started. You have to pay attention, but if you don't want to write it down, save it in a file or on a flash drive, it's not complicated. Some people may disagree, and that's fine, but there's no need to overcomplicate things; that's how you end up getting even more tangled up.

Let’s tell each other the truth, using a centralized exchange is always much more easier than using some self custodial wallets or even the hardware wallets. And this is often the real reason why some newbies would rather just leave their asset in some CEX as long as they feel it’s safe there and no one can access their funds without their passwords, because setting up some wallets and storing your asset there can be a bit complicated and not really that new user friendly. Again, they say hardware wallets are the safest, but not everyone can afford or use one.

[Abiky]

I was trying to help a friend set up their first hardware wallet yesterday, and it really hit me how intimidating this stuff has gotten. Between writing down seed phrases, managing passphrases, and explaining different address types, their eyes completely glazed over.It made me wonder, are we making security so complex that we're accidentally forcing everyday people to just leave their coins on centralized exchanges? How do we fix the user experience without sacrificing the whole not your keys, not your coins philosophy?

Developers these days have improved UI (user experience), so setting up a hardware wallet these days is not as hard as it seems. Many hardware wallet manufacturers provide step-by-step instructions for you to get started. They even have their own apps for mobile devices. Ledger is easy to use, although it has faced criticism lately. BitBox02 is a much better choice, imo. It's super easy to use and convenient. But if we're taking about a wallet such as the ColdCard Bitcoin Signing Device, that's another subject. You'd need some technical knowledge to be able to use it.

Most people are either too lazy to learn, or just want to get things done quickly and easily. Therefore, choosing a centralized exchange would be the most-straightforward way to get started into crypto. Even if there's the risk of losing it all in the long run. The only ones who truly care about self-custody are non other than real bitcoiners, geeks, and libertarians. You decide what to do with your BTC. It's your money, anyways.

[tbct_mt2]

Most people are either too lazy to learn, or just want to get things done quickly and easily. Therefore, choosing a centralized exchange would be the most-straightforward way to get started into crypto. Even if there's the risk of losing it all in the long run. The only ones who truly care about self-custody are non other than real bitcoiners, geeks, and libertarians. You decide what to do with your BTC. It's your money, anyways.

They're lazy to learn not too hard things, and they're careless to put safety of their bitcoins or cryptocurrency funds to centralized exchanges. The worse thing is they are ready to do such risky activities after knowing risk of centralized exchanges and custodial wallets.

Risks are known and warned many times, I think more than enough, and if such careless people keep doing wrong things, if anything bad happens with their funds, they will be really deserved such consequences and losses.

Reminder: do not keep your money in online accounts.
[LIST] Open Source Hardware Wallets.
[GUIDE] How to buy a Hardware Wallet the right way.

[fuguebtc]

I don't think it's gotten complicated; on the contrary, it's much easier nowadays than when I started. You have to pay attention, but if you don't want to write it down, save it in a file or on a flash drive, it's not complicated. Some people may disagree, and that's fine, but there's no need to overcomplicate things; that's how you end up getting even more tangled up.

Let’s tell each other the truth, using a centralized exchange is always much more easier than using some self custodial wallets or even the hardware wallets. And this is often the real reason why some newbies would rather just leave their asset in some CEX as long as they feel it’s safe there and no one can access their funds without their passwords, because setting up some wallets and storing your asset there can be a bit complicated and not really that new user friendly. Again, they say hardware wallets are the safest, but not everyone can afford or use one.

I do not recommend storing bitcoin on centralized exchanges. But yes, the truth is that using them is significantly easier than using non custodial wallet and hardware wallet.

Remembering email and passwords is much simpler and easier than managing private key or securely storing a recovery seed phrase.


Self custody may be easy for many of us, but that is not necessarily true for everyone.

[YellowSwap]

I was trying to help a friend set up their first hardware wallet yesterday, and it really hit me how intimidating this stuff has gotten. Between writing down seed phrases, managing passphrases, and explaining different address types, their eyes completely glazed over.It made me wonder, are we making security so complex that we're accidentally forcing everyday people to just leave their coins on centralized exchanges? How do we fix the user experience without sacrificing the whole not your keys, not your coins philosophy?

Self custody means taking responsibility, this is something that many crypto investors don't want to do, and that's why they will always keep their coins and every digital assets on Coinbase and Binance like platforms.

You think every Mt.Gox victims learned from that incident? You will be surprised how many people who are once victims of the likes of Mt Gox are still keeping their coins on Coinbase.

They strongly believe that Coinbase is just a better banking than Mt.GoX was, and there is nothing you and I can do about it, if not for those upcoming beginners there no more reasons to keep telling people to take self custody very seriously.

[Hamza2424]

Lol, people nowadays can spend many hours a day on social media and they feel no issues. I am asking myself how setting up a hardware wallet can cause things like "eyes completely glazed over". Frankly, in my opinion, your story is like a fake one.

Haha, this is the reality. Some people can really waste hours, and their daily screen time can be more than 10 hours, but when it comes to a normal task like this, they make a big thing out of it. Their motivation becomes so low that they don't want to convince their mind to do something new.

I think it's dopamine that keeps decreasing when we waste time like this. For example, before watching reels our mind can be energetic, but after watching reels we feel bored and less motivated. Anyway, the discussion is going toward reels and their side effects, while we are here to discuss a problem that is not really a problem at all haha.

People don't want to take any responsibility. They are so used to AI that they want everything to be served to them on a platter. But I am saying all this without understanding the mentality of the person the author talked about, which means I am judging from only one angle, and that is not good.

We should hear more from him, like why he thinks it is complex.

[MRY]

I do not recommend storing bitcoin on centralized exchanges. But yes, the truth is that using them is significantly easier than using non custodial wallet and hardware wallet.

Remembering email and passwords is much simpler and easier than managing private key or securely storing a recovery seed phrase.


Self custody may be easy for many of us, but that is not necessarily true for everyone.

It is quite common to elect to keep money on the exchange in the most convenient manner possible. Using of private key may be challenging to many people that are not technologically inclined. I think, you should pick the technique that is the most comfortable and in your present abilities. And lastly, but most important: Beware of losing your cash because of any technical glitches. At the moment I have also a wallet such as Electrum to store my BTC.

[promise444c5]

Using of private key may be challenging to many people that are not technologically inclined. I think, you should pick the technique that is the most comfortable..

That’s the problem right there “comfortable”. You don’t expect something you have control over to be comfortable ? Maybe it’s not comfortable for some but if you want to be your own custody then you have to find a way to get comfortable with it.

Of course, no one is stopping you from keeping those bitcoins on a custodial service so far you know the risk behind it . Online wallet is a risk on its own btw ..

[Findingnemo]

I was trying to help a friend set up their first hardware wallet yesterday, and it really hit me how intimidating this stuff has gotten. Between writing down seed phrases, managing passphrases, and explaining different address types, their eyes completely glazed over.It made me wonder, are we making security so complex that we're accidentally forcing everyday people to just leave their coins on centralized exchanges? How do we fix the user experience without sacrificing the whole not your keys, not your coins philosophy?

Self custody isn't free either, one needs to be competent enough to hold their assets and for that they may need such knowledge like how to keep the private keys/seeds safe, how not to get phished, how they should set the fee and many other things and it maybe overwhelming for someone to learn everything on one go but give it a weak then I am sure they will be equipped with everything they need.

I would suggest them to start with electrum on the PC, that teaches them many things and if better on the testnet version.