I keep watching that step get skipped in Bitcoin.
Here is the setup. Holding your own bitcoin means you keep the secret code that moves it, usually twelve or twenty four words written on paper or kept in a small device. People call that self custody. The other option is handing the code to a company that stores it for you and gives you a login instead. That company is a custodian, and an exchange is the most common kind.
Every year somebody argues that ordinary people cannot be trusted with the words, so the job should be left to professionals. And every year the argument shows up without the step where the current way is shown to fail at the job.
So look at who lost the money. Chainalysis counted 3.4 billion dollars stolen across the industry from January to early December of last year, the second worst year they have on record. One breach at one exchange, Bybit, was 1.46 billion of that, more than half of everything taken in roughly 150 hacks. For the first time since 2020, the companies holding other people's coins lost more than the open software did.
Now the fair version of the other side, because it is real and it is not small. Individual wallets were hit 158,000 times last year, around 80,000 people, and 713 million dollars went. Most of it was someone being talked into reading their words aloud to a stranger pretending to be support. That trick has a name, phishing. And the number I hate most: violent robberies of people known to hold bitcoin came to 58 million dollars last year, the highest anyone has measured, with 30 million more by the middle of this one. Keeping your own keys has a failure mode, and sometimes it knocks on your door.
I am making a narrow claim, and it is about who carries the burden. If you want me to hand over the words, show me that keeping them fails at the specific job more often than giving them away does. The largest single loss of the year came from the professionals.
What would change my mind: one year where individual holders lose more, in total and per person, than the custodians do, with the phishing and the robberies counted in full.
Bitcoin never asks you to trust anyone with that decision. It hands you the choice, and it hands you the bill either way.
if this made you check who is holding yours, Zap ⚡
