Self-custody is truly necessary for everyone.

[SilverCryptoBullet]

I would rather take lessons to improve my security awareness instead of switching opinions even after the Coldcard incident. If there is anything I've learnt from the incident is that every layer of security is important as much you know what to do and how to do it, security is continuous and nonstop, slight vulnerability can lead to actual loss.

No matter what, using a custodial setup is never an option, we cannot rely on third parties for proper coverage.

Self custodial wallets are better choices for long term storage than custodial wallets like exchanges. The Coldcard security incident is not a reason to change this thought about wallet security and fund safety, so non custodial wallets will still be recommended wallets to use, especially for long term storage.

People don't have to change their opinion about two wallet types, change their practice only because of Coldcard incident. Most important, changing their practice from non custodial wallets to centralized exchanges for fund storage is actually a very bad chance, and they need to avoid that.

They only need to learn more about security
https://www.lopp.net/bitcoin-information/security.html

[ethergod]

We have to take into account that the vast majority of people are not sophisticated enough to understand how to keep private keys safe. So self-custody is plainly not for everyone. We cannot have a system where because of a lost private key an entire person's savings is gone. Also, self-custody has inherent vulnerabilities - it requires trust of hardware wallet makers or even private key generators.

[MadSl1m]

Most people who actually spend their bitcoin are not on either side of this. They keep the keys and attach a card. The keys stay yours and nobody can move the coins. The card is a permission, and the issuer can cancel it any day. So the question stops being "can they take my coins" and becomes "can they stop me spending". Fine trade for many. Just don't call it full self-custody. 

[BitBakerr1]

So what im trying to say is choose different security methods for recovery and don't put your whole fund in one wallet .  

Putting your money in one wallet is very risky because if anything should happen, you will totally lose everything. It is better that you put your money in different wallet. It is more safe and it gives more peace of mind than having your money in one wallet.

There was a story I heard of someone losing huge amount of bitcoin because someone had access to his wallet and took all the bitcoin away from him and that was how he lost everything that is worth millions, if he had distributed the bitcoin into different wallets, this won’t have happened to him, even though one was attacked he would have still had some bitcoin left in his other wallet, so everyone should try to learn this, put your money in different wallet, it is more better.

[adultcrypto]

We have to take into account that the vast majority of people are not sophisticated enough to understand how to keep private keys safe. So self-custody is plainly not for everyone. We cannot have a system where because of a lost private key an entire person's savings is gone. Also, self-custody has inherent vulnerabilities - it requires trust of hardware wallet makers or even private key generators.

I perceive that a lot of people are beginning to doubt self-custody given what happened with coldcard and the increasing attack on Trezor via phishing emails. It is human to begin to weigh the advantages and disadvantages of any method, in this case self-custody and transferring the responsibility to a third party. Both sides of the argument are reasonable but I still go with self-custody because it agrees with the cose design of bitcoin and offer true freedom which bitcoin embodies.

[Mpamaegbu]

Is it better to leave our money in a large regulated institution, where there are rules and, if there is a problem, you can go to court?

Yes, self custody leaves a certain advantage for hodlers but it also creates fear of hacks and all that too as hodlers can still also lose all they've via hacks. It's not a one way traffic. We look at the merits and demerits too of this thing. Trust me, all these concerns about self custody is because the crypto industry isn't fully regulated yet. If it were, people won't mind leaving their coins on exchanges. It will be just the way we leave money with banks or the way forex traders leave money in their trading platforms without bothering their heads over it even when they aren't trading actively.

[osasshem]

Is it better to leave our money in a large regulated institution, where there are rules and, if there is a problem, you can go to court?

Self-custody gives the user direct control over their Bitcoin, but it also puts all the responsibility on them.

Some people may have difficulties dealing with this. A seed phrase kept in an unsafe place, a compromised computer or phone, a lost backup, or simply a security mistake can be enough to lose all your Bitcoin forever.

Older people, who have difficulties with technology, may have more problems with the wallet and security.

And for someone who has a large amount of Bitcoin, does it really make sense to put everything in self-custody?

Those who finds taking full control of their investments may find it difficult to cope with Bitcoin investment, and they will find solace in other forms of investment. The presence of regulatory institutions coming into the crypto industry is paving way for people like this to have a safe form of investment in the crypto market, of which is good to increase the rate of mass adoption.

Older people who are not technologically inclined are to either keep off from crypto investment, or just learn the very basics of protecting their assets and leave the rest. 

Maybe it is better to diversify not only between different forms of custody, but also between Bitcoin, traditional investments and regulated institutions.

The idea of diversification is not a bad one, not all investors will leave their investments to solely be on Bitcoin, there are other investment assets that are worth investing. What makes Bitcoin/crypto investment different is simply because it is not under anybody's control, except you the investor, and letting anyone know about it is at your own risk. Unlike traditional forms of investments, where at the point of registration/getting the assets, you fill a form immediately for a NOK, in case anything happens, this is automatic, while in crypto investment, you the investor have the personal decision to add NOK or let it be.

[Curious T]

Instead of using centralized exchanges, you should have different wallets for your Bitcoin. You can also have a hardware wallet if you hold a lot of Bitcoin. You don't have to put all your Bitcoin in one wallet. You can put the ones you plan to hold for the long term in a hardware wallet.

I agree that a person should diversify. It's good to invest in other things other than Bitcoin if he has the money. Buy stocks, real estate, start a business. Bitcoin is not the only form of investment. As for altcoins, I don't know much about them I only know the popular ones, so I try not to mess with them, and I advise peopel that don't know much to do the same too.

[MainIbem]

Instead of using centralized exchanges, you should have different wallets for your Bitcoin. You can also have a hardware wallet if you hold a lot of Bitcoin. You don't have to put all your Bitcoin in one wallet. You can put the ones you plan to hold for the long term in a hardware wallet.

I agree that a person should diversify. It's good to invest in other things other than Bitcoin if he has the money. Buy stocks, real estate, start a business. Bitcoin is not the only form of investment. As for altcoins, I don't know much about them I only know the popular ones, so I try not to mess with them, and I advise peopel that don't know much to do the same too.

Based on the recent hardware wallet drain, if you're advising someone on using a hardware for storage, you have to be specific so they don't go using the one with a weak security, og's would have a clue on safer hardware wallets but how about newbies in Bitcoin, that's why I'm concerned, so your statement don't mislead them. A multi sig wallet or open source wallet with passphrase for extra security is enough. I'm a big supporter of diversification so your second statement concerning it is fact.

[GiftedMAN]

I agree that a person should diversify. It's good to invest in other things other than Bitcoin if he has the money. Buy stocks, real estate, start a business. Bitcoin is not the only form of investment. As for altcoins, I don't know much about them I only know the popular ones, so I try not to mess with them, and I advise peopel that don't know much to do the same too.

While you encourage people to try investing in other things other than Bitcoin it is important they also have the knowledge of that they intend to invest into instead of choosing that part due to the things they heard from people and the media. If you are very familiar with Bitcoin your focus should be more on Bitcoin investment but if you think you can go into different sectors like you mentioned be ready to face the risk that comes from those other investments.  Some people are familiar with the best altcoins to go into it should be a thing of choice, if they have knowledge of it they should go ahead but they should be ready to face the risk involved too.

[salad daging]

What I'm saying, however, is that Mt. Gox, Bitfinex, FTX, Bybit, and others have committed mistakes, lost funds, even crumbled down completely. Their users got their money back, or have received compensation, fully or in part, albeit late in some instances.

When one who is into self-custody commits a mistake and lost funds, not a tiny fraction of it will be returned to him/her.

I'm not a fan of centralized exchanges. I'm simply stating facts.

Mt.Gox, FTX takes years to return funds to its customers, it is not known whether all the victims have received it, because they have read news that they continue to delay distribution.
Now Bitmart is the same, customers are difficult to attract, has everyone received the funds? And this becomes a risk of saving on the exchange.

Even if the Self-custody is not completely secure, it depends on how secure it is, or they can store multiple btc assets in multiple wallets with different hardware so it's impossible for me to fault them all.
again, it all depends on our own who manages, if you stay careless then the risk of losing funds, that's it.!

[Curious T]

While you encourage people to try investing in other things other than Bitcoin it is important they also have the knowledge of that they intend to invest into instead of choosing that part due to the things they heard from people and the media. If you are very familiar with Bitcoin your focus should be more on Bitcoin investment but if you think you can go into different sectors like you mentioned be ready to face the risk that comes from those other investments.  Some people are familiar with the best altcoins to go into it should be a thing of choice, if they have knowledge of it they should go ahead but they should be ready to face the risk involved too.

It goes without saying that you should know what you're going into before going into it. Even with Bitcoin, it is advisable for people to know about Bitcoin before investing. They should at least understand the basics. Before buying any kind of financial investment, you need to at least have a basic understanding of that asset. The reason I don't mess around with altcoins is that I don't know much about them.

What I'm saying, however, is that Mt. Gox, Bitfinex, FTX, Bybit, and others have committed mistakes, lost funds, even crumbled down completely. Their users got their money back, or have received compensation, fully or in part, albeit late in some instances.

When one who is into self-custody commits a mistake and lost funds, not a tiny fraction of it will be returned to him/her.

Not everybody has gotten back their payment from these mistakes. Not everybody got compensated. Also, you also took out the ones that the exchange froze their account and seized their assets. I understand what you're trying to say, but this point doesn't mean anything.

[Iranus]

What I'm saying, however, is that Mt. Gox, Bitfinex, FTX, Bybit, and others have committed mistakes, lost funds, even crumbled down completely. Their users got their money back, or have received compensation, fully or in part, albeit late in some instances.

When one who is into self-custody commits a mistake and lost funds, not a tiny fraction of it will be returned to him/her.

Not everybody has gotten back their payment from these mistakes. Not everybody got compensated. Also, you also took out the ones that the exchange froze their account and seized their assets. I understand what you're trying to say, but this point doesn't mean anything.

Account freezes or asset seizures are quite rare unless you are involved in money laundering or violating their rule.

Risk of keeping Bitcoin on CEXs are real, and nobody is denying that or recommending it. But to be fair, selfcustody come with its own risk as well. All it take is one careless mistake or an accident, and your fund can be gone forever with no way to recover even a small portion of them. Coldcard is one example that we cannot simply ignore when talking about selfcustody.

To be fair, both have their own advantages and risks.

[Outhue]

So earning money isn't harder compare to going full self custody? I know how hard it is to trade Bitcoin and in the end I will just choose the easiest method to keep my Bitcoin safe? I wouldn't hold anyone back from however way they choose eto keep their Bitcoin safe but for me I will never send my coins to any exchange unless I want to sell them, I will never leave my coins in the hands of any companies or centralised platforms for any reasons, all eyes are on your digital Gold, if you get too comfortable with them doing everything for you they will be the ones to teach you a very costly lesson later. Be responsible for your coins, it's your duty to keep them safe.

[Curious T]

Account freezes or asset seizures are quite rare unless you are involved in money laundering or violating their rule.

It's not as rare as you think. I understand that it's rare, but it happens. I know two people that their binance account has been frozen without warning.

Risk of keeping Bitcoin on CEXs are real, and nobody is denying that or recommending it. But to be fair, selfcustody come with its own risk as well. All it take is one careless mistake or an accident, and your fund can be gone forever with no way to recover even a small portion of them. Coldcard is one example that we cannot simply ignore when talking about selfcustody.

Nobody has ever said self-custody doesn't have its own risks. I see people talk about the risk of self-custody on this forum every day. I see people talk about keeping your seed phrase secure, I see people talking about keeping their devices and wallet safe. So everybody knows the risk that comes with self custody. They risk are there, but they are risks that you have control over. The risk of CEX is a risk that you have no control over.

[OcTradism]

Nobody has ever said self-custody doesn't have its own risks. I see people talk about the risk of self-custody on this forum every day. I see people talk about keeping your seed phrase secure, I see people talking about keeping their devices and wallet safe. So everybody knows the risk that comes with self custody. They risk are there, but they are risks that you have control over. The risk of CEX is a risk that you have no control over.

Everything in life have risk, more or less, and there is nothing without risk.

DEX, CEX, custodial wallets, non custodial wallets are similarly with advantages and disadvantages but with self custodial wallets, Bitcoin owners and holders can completely control their storage, their Bitcoin private keys, secure their wallets, secure their devices, and don't have to feel fearful and uncertain about anything suddenly scam or hack with centralized exchanges.

They are fully controlling their devices, wallets, private keys so they must do things in secure ways. It's responsible bitcoin storage by Bitcoin owners and holders, that require enough learning and practicing but it is very achievable if people are ready to learn and practice in secure ways.