Self custody is almost a new idea to all of us in modern society. I personally feel uneasy about having so much value stored as a phrase hidden somewhere physically. There will always be risks.
How do people upon adopting crypto go about handling self custody? My main thought is that we heavily secure something like Bitcoin via self custody and end up using stablecoins for transactions by converting btc into cash every now and then.
How do big institutions secure their Bitcoin such as MicroStrategy or Tesla? If we arrived at a world where everyone has Bitcoin on a metal plate somewhere in their house, things would be different. You have a much better chance of stealing your neighbours seed phrase than getting access to their bank account.
I’m not convinced the world is ready for self custody yet. There must still be heaps of people using exchanges because they don’t know enough to trust themselves. If this becomes big in the next decade, I really don’t know how attractive self custody is as a concept. Perhaps by the time Bitcoin is popular we will appreciate it as the only option and see self custody as something necessary to accept?
The one thing I can think of to severely mitigate the risk involved is to use the 25th word. For anyone unfamiliar I learnt this not too long ago! You have a standard 24word BIP39 phrase where the first 4 letters of each word are unique so you only have to store the first 4. You write the 4 letter strings on a metal plate then write a password you came up with on another metal plate and store them in two entirely seperate areas. The idea is you have easy access to your recovery phrase but you need the password for the phrase to work. I’m cautious about relying on my memory which is why I would opt to store the password physically also. Perhaps my family would like to find the password when I die.
Apart from the above discussion I’m not aware of any other projects intended to make self custody easier. I’m quite skeptical about how easily it will be to adopt a self custody asset.
Apologies if this is a discussion that has been held before I am just burning for answers. Thanks guys.
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