Roadmap to Self-custody Discussion

[Doan9269]

Don't let coldcard hack scenarios discourage you from embracing self-custody; there is no negotiation for having a non-custodial wallet because you cannot trade your privacy and security control for custodial storage.

I was browsing through X and came across a post suggesting for the road map to adopt non-custodial wallets, whereby several non-custodial wallets were listed, which prompted me to bring it to our local board for further discussions on some key areas. I would like us to share our suggestions based on our experience and expertise in Bitcoin wallets and security measures.


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Recommended additional wallets under multisig categories.

• Sparrow wallet, Casa, and Electrum wallet should be recommended under multisig wallet.
  

You can see that Coldcard was not included under hardware wallet, but in addition, here are other suggested wallets I will not recommend that were listed.

• Ledger wallet under hardware wallet is not recommendable because of privacy leaks.
• Any closed-source non-custodial wallet is not recommendable because its source code is not open, example trust wallet.

Additional Information

It is advised to enlighten Bitcoin users to take extra security measures for their coins, which could involve taking additional consideration of wallets that support the use of a passphrase or a multisig wallet under non-custodial storage; we can also decide to run a full node using Bitcoincore.

Let's discuss and list our supported wallets and the ones to warn users about using, with reasons.

[IceLincoln]

This coldcard case have sparked a lot  of debate online and in some forums on the use of non custodial and custodial wallets, ETFs and others… but this I don’t see as an argument, because there’s nothing better than owning and controlling your bitcoin yourself, you just have to protect your seedphrase better and for larger holdings, make use of pass phrase as an additional layer of protection for our wallets.
A good number of Nigerians use Trust Wallet to hold their bitcoin even as it’s a closed source, I think some features of it are open sourced.
I’ll recommend electrum wallet for Nigerians who want a bitcoin only non custodial open source wallet, it has been around for years and supports some advanced features.
Any wallet we are using, the most important thing is saving or securing your seedphrase and passphrase in a way that you will never lose it.

[Donneski]

While everything you said made sense, I'll like to add that it's also not necessary for everyone to get one wallet recommendation. The type of wallet that's ideal for someone with small amounts of Bitcoin that's frequently used in daily transactions is different from the person with one with large amounts of Bitcoin that's supposed to be stacked for years.  For someone with larger holdings, multisig or a well managed cold wallet will definitely make more sense while a simpler non custodial wallet may be okay for everyday use. The main focus should be making sure the security setup matches the amount of BTC as well as the user's level of experience.

[Hypnotizer]

Don't let coldcard hack scenarios discourage you from embracing self-custody; there is no negotiation for having a non-custodial wallet because you cannot trade your privacy and security control for custodial storage.

Coldcard wasn’t the only Hardware Wallet that got problems this month, and this events that happened would kinda discourage many users especially beginners about adopting self custody. But this shouldn’t be a call for discouragement rather it should be a call for people to be careful and due diligent when buying a hardware wallet or they should just setup their own airgapped device themselves to custody their coins.

-snip

Why is Ledger mentioned there? 

Ledger is the worst Hardware wallet so far, their users have lost a lot over the pass five years and just because they didn’t have any issue recently that doesn’t make them recommended. Anybody that wants to use Hardware wallet should research and consider possible threats associated with the company he’s planning to buy and choose wisely..

[Money bag]

Walk in the a Nigerian street and ask which wallet they trust more than others and you will hear majority of people saying Trust wallet, and the truth is that I also believed this as well a while back, it was with my time in this forum that I actually found out that while Trsut wallet may look to be non custodial but it'sba closed source wallet and a half measure like that is too much of a risk already to store bitcoin in.
People still use it but that doesn't mean it's secured. Being able to hold multiple assets is probably the reason who people use it that much.

[coinlary]

Every reputable should allow extending your seedphrase with a passhrase unless they have something fishy going on and that should give you a red flag number one on why you need to delete and throw whatever backups written from that wallet in a waste bin(ofcourse you need to move your sats out first  ).
There's  no way a wallet won't allow it so far they recover seed because not every seed is without a passphrase.

Use a passphrase and you will most especially be fine(provided you have somethingreasonable that can't be  easily brute forced ) . If you don't know what you're doing, don't  go for Multisig but it gives you one of the strongest security.

[Joy- maker]

Don't let coldcard hack scenarios discourage you from embracing self-custody; there is no negotiation for having a non-custodial wallet because you cannot trade your privacy and security control for custodial storage.

The Coldcard wallet incident has made a lot of people to start having second thoughts about self custodial wallets, but that's not even the problem, because with time people we get over that incident.

The problem is that people are now moving their Bitcoin investment to decentralized exchanges to store them for the long term, this is not only riksy, but also foolishness.

Have they forgotten about the Bybit exchange incident? what about the Bitmart incident? There is no way around it, self custody remains the safest place for storing your Bitcoin investment for the long term.

[Antidote47k]

they should just setup their own airgapped device themselves to custody their coins.

Totally agree, that could give someone more control, however i also think there is a point where adding more layers of security can introduce more room for user errors. A hardware wallet might not be completely trustless but neither is a DIY airgapped setup, you will still have to make sure that the software, entropy generation, backups and signing process and transaction are properly handled and correctly.

Generally my opinion is that the amount of bitcoin being secured and most importantly users technical ability should influence the type of setup to use, sometimes the most advanced setup might not necessarily be the safest one if the user in question doesn’t fully understand how it works.

[IjawMan]

Walk in the a Nigerian street and ask which wallet they trust more than others and you will hear majority of people saying Trust wallet, and the truth is that I also believed this as well a while back, it was with my time in this forum that I actually found out that while Trsut wallet may look to be non custodial but it'sba closed source wallet and a half measure like that is too much of a risk already to store bitcoin in.
People still use it but that doesn't mean it's secured. Being able to hold multiple assets is probably the reason who people use it that much.

I was also in that boat with Trust wallet that I took it to be one of the best online non custodial wallet for every day due but when I joined the forum the whole mindset I had changed after reading much information about online and offline wallets.

Now I do not have that boldness to talk about Trust wallet to any body as a recommendation in the way I can do for Blue wallet or electrum wallet which are complete open source wallets. For Bitcoin only wallets I have them to recommend for daily use online more than any other.

[coinlary]

Generally my opinion is that the amount of bitcoin being secured and most importantly users technical ability should influence the type of setup to use, sometimes the most advanced setup might not necessarily be the safest one if the user in question doesn’t fully understand how it works.

It's  not like that really advance AFAIC or probably the way I see it . There're more advance stuffs compare to just setting up a cold storage , at least it's the most advance setup you can think off + adding extra layers like multisig.  No other setup come close unless you want to go as far to the extent of generating your own Private  keys  and constructing transactions all by yourself without need the help of a software specifically desing to do that, which is beyond what we discussing.

There are only two reason to see it as complicated, either it gets difficult to operate such level of tech or not just willing to learn it .  But , that doesn't mean everything won't come with a risk, the higher you go the more responsibility and risk while opposite is less responsibility with more risk but that doesn't also mean you can't keep everything simple(simple like having your seed generated properly & adding a passphrase) and still be fine.

[Shadiq]

None of us may know about all the wallets mentioned, I know about a few wallets from the mentioned list and I use them. In the current security-related risky environment, I do not dare to recommend any wallet. Rather, I would suggest, when choosing a wallet, use a reputable self-custody wallet that supports passphrase and multisig. This advice is certainly applicable for long-term investments or storing large amounts of Bitcoin.

But you can use any self-custody wallet for use as a hot wallet, it can be for convenience or security reasons. Try to be self-reliant in choosing a wallet and educate yourself about security, do not rely on the advice of others. This will increase your dependence on yourself and you will not have to blame others for any accidents.

[The Founding Titan]

None of us may know about all the wallets mentioned, I know about a few wallets from the mentioned list and I use them. In the current security-related risky environment, I do not dare to recommend any wallet. Rather, I would suggest, when choosing a wallet, use a reputable self-custody wallet that supports passphrase and multisig. This advice is certainly applicable for long-term investments or storing large amounts of Bitcoin.

But you can use any self-custody wallet for use as a hot wallet, it can be for convenience or security reasons. Try to be self-reliant in choosing a wallet and educate yourself about security, do not rely on the advice of others. This will increase your dependence on yourself and you will not have to blame others for any accidents.

At the end of the day each wallet offers something that might be slightly different from the others meaning that my reason for wanting to use a particular wallet might be your reason for not wanting to use it, telling you to use the same one I'm using because it works for me will be ill-advised if stvthe end of the day you end up hating the wallet, the blame will fall on me to suggesting that particular wallet to in the first place.
To avoid that I will simply give you options that I think are good (my person preference included) and then ask you to check for the one you'd prefer to use, all you have to do is run your own research to find that one you want and start using it, this way the choice remains your own instead of someone else's forced on you.

[knowngunman]

Why is Ledger mentioned there? 

Ledger is the worst Hardware wallet so far, their users have lost a lot over the pass five years and just because they didn’t have any issue recently that doesn’t make them recommended. Anybody that wants to use Hardware wallet should research and consider possible threats associated with the company he’s planning to buy and choose wisely..

The only thing ledger is good at is early to publish when they are affected. It's funny how their bio on X reads "free from compromise" when in actual sense, they are leading the race when it comes to compromise. Ledger users are always a target and they don't seem safe because a few days ago, ledger suffered a data breach where attackers reportedly had access to sensitive customer's contact information like address and email address.

None of us may know about all the wallets mentioned, I know about a few wallets from the mentioned list and I use them. In the current security-related risky environment, I do not dare to recommend any wallet. Rather, I would suggest, when choosing a wallet, use a reputable self-custody wallet that supports passphrase and multisig. This advice is certainly applicable for long-term investments or storing large amounts of Bitcoin.

But you can use any self-custody wallet for use as a hot wallet, it can be for convenience or security reasons. Try to be self-reliant in choosing a wallet and educate yourself about security, do not rely on the advice of others. This will increase your dependence on yourself and you will not have to blame others for any accidents.

This is one of the problem people normally have when choosing a wallet. They chose a wallet based on others recommendation without doing further research about the wallet to know if it align with their practice or if it actually offers what they are looking. People seem to underrate the "do your own research" that we sing here every day.

[Hypnotizer]

they should just setup their own airgapped device themselves to custody their coins.

Totally agree, that could give someone more control, however i also think there is a point where adding more layers of security can introduce more room for user errors. A hardware wallet might not be completely trustless but neither is a DIY airgapped setup, you will still have to make sure that the software, entropy generation, backups and signing process and transaction are properly handled and correctly.

Generally my opinion is that the amount of bitcoin being secured and most importantly users technical ability should influence the type of setup to use, sometimes the most advanced setup might not necessarily be the safest one if the user in question doesn’t fully understand how it works.

Well in that case, you should use an open source wallet like Electrum for the software on your DIY airgapped wallet, and that’s why I usually emphasize on the importance of learning and understanding about the security stuffs especially if you’re investing a lot, you need to understand them first before you start self custody. You can’t do all these setups correctly if you don’t fully understand them else you’ll make mistakes..

The Approach of setting up an Airgapped device yourself is to prevent scenarios where the delivery courier of the Company you purchased your wallet from has a data leak just like what happened to Trezor. That would cause you to be a target for wrench attacks or phishing attacks but you can still buy trusted open source Hardware wallet if you can eliminate that risks.

[DubemIfedigbo001]

For someone with larger holdings, multisig or a well managed cold wallet will definitely make more sense while a simpler non custodial wallet may be okay for everyday use. The main focus should be making sure the security setup matches the amount of BTC as well as the user's level of experience.

Believe me, multisignature wallets are best suited for enterprise style management where there's shared custody of funds. A person don't need multisignature wallet. It can introduce unnecessary complications for you trying to keep track of the different seed phrases for the wallets that makes up the quorum.

It's better you use a single wallet with a passphrase of not less than 30 character length, comprising of uppercase, lower case, numbers and special characters. It's even best for assets segmentation, you can use same seed phrase and different passphrases.

It not only reduces the complexity in offline documentation, but the cost as well when you're initiating a transaction. Multisignature wallets can take larger fees compared to single signature wallets

OP, I use Electrum for Bitcoin and Cake wallet for Altcoins, I'm not giving up on self-custody anytime soon.

[Hyphen(-)]

You can see that Coldcard was not included under hardware wallet, but in addition, here are other suggested wallets I will not recommend that were listed.

• Ledger wallet under hardware wallet is not recommendable because of privacy leaks.
• Any closed-source non-custodial wallet is not recommendable because its source code is not open, example trust wallet.

Yes, the COLDCARD hack has brought a lot of controversies among Bitcoin investors especially newbies who are trying to take the security of their Bitcoin as their responsibility, and the hardware wallets have started bringing doubts to them because the hack is huge, and after that, some hardware wallets also have data leak which is something to worry about, but we can’t allow third parties to control our Bitcoin for us, we still need to learn more to keep our Bitcoin safe.

Ledger should not be included in this list mate, it is the least wallet I can recommend to person because I don’t trust them due to their reputation already, so I will never feel safe using a Ledger wallet.

However, the main advice here is to avoid closed-source wallets, always use an open source wallets, use the wallets that is well known and people are using, Electrum wallet is good for beginners, BlueWallet also is good; the main challenge is your seed phrase, keep your seed phrase in a safe place.

[Doan9269]

However, the main advice here is to avoid closed-source wallets, always use an open source wallets, use the wallets that is well known and people are using, Electrum wallet is good for beginners, BlueWallet also is good; the main challenge is your seed phrase, keep your seed phrase in a safe place.

Traditionally to what you have advised also, is in putting in place an extra security measure that will prevent any form of hack or scam that will be used against us when we are being targeted for their prey, we can always consider using wallet that supports additional safety like in use of passphrase multisig wallet that's why I have suggested from the first post, then also as you have said, once we don't create a vulnerability by ourself, to experience any form of attack on our Bitcoin will be difficult.

[Fiatless]

However, the main advice here is to avoid closed-source wallets, always use an open source wallets, use the wallets that is well known and people are using, Electrum wallet is good for beginners, BlueWallet also is good; the main challenge is your seed phrase, keep your seed phrase in a safe place.

Coldcard wallet wasn't a bad product initially. In fact, it was generally seen as trustworthy by many reviewers. It was after these issues that its lapses became apparent. I wouldn't blame the victims of these Coldcard problems because many of them thought it was a good wallet. Maybe they would have consistently followed up on recent developments regarding the wallet. With advancements in the capabilities of artificial intelligence, there might be an increase in the exploitation of loopholes in crypto projects.

[Grace333]

If there is something coldcard hack taught us, it would be never to trust hardware wallets as well custodial wallets. Hardware wallets have been known to be more secured than centralized exchanges however we can't downgrade our security level with the aim of being secured, instead I will advise that we take self custody more seriously. Personally I have been making use of non custodial wallets and so far i have not had any issues using it, I recommend we making use of non custodial wallets, back up your seed phrase and store them in a vault. Multiple secure storage locations is advise so we don't end up losing our wallets because we failed to store our seed on different locations. This is a more cheaper method compared to buying Hardware wallets.

[casey15]

Like I said before in one of the previous threads....The lesson to take from this whole cold card incident is the fact that even with a cold hardware wallet, you still need to practice proper security measures. The incident should not be a discouragement from self custody but it should be an eye opener and a form of enlightenment instead. For multisig, sparrow, electrum and Casa are good choices. Users should do their research and try to understand the difference between open source, hardware based custodial solutions before choosing a wallet