Trezor advocates self-custody for Bitcoin holders

Trezor, a prominent hardware wallet provider, has emphasised the critical role of self-custody in protecting Bitcoin (CRYPTO:BTC) holders from the potential pitfalls associated with increased institutional adoption of the cryptocurrency.

As institutional interest in Bitcoin grows, it brings both recognition and risks.

Lucien Bourdon, Trezor’s Bitcoin analyst, pointed out that institutional involvement can lead to centralisation, where large entities control significant amounts of Bitcoin.

This centralisation introduces volatility and negative sentiment, particularly if these institutions face financial difficulties.

“Self-custody is a long-term solution to possible centralised failures,” Bourdon stated, underscoring the importance of individuals managing their own keys without relying on third parties.

He cautioned that owning shares in companies like MicroStrategy or Bitcoin ETFs does not equate to holding actual Bitcoin.

“If these institutions encounter problems, investors relying on them may face losses without the protections self-custody provides,” he added.

Despite the risks associated with self-custody, such as the responsibility of safeguarding private keys, the trend is gaining traction.

Bourdon noted that individuals still hold the majority of Bitcoin supply, with governments collectively owning only about 2.2% of the total supply.

This distribution reinforces Bitcoin's decentralised ethos, where control remains with individuals rather than centralised entities.

While state adoption can promote fiscal discipline and transparency, Bourdon argued that Bitcoin's strength lies in its ability to empower individuals.

He remarked on the need for governments to differentiate between Bitcoin and other cryptocurrencies that lack fixed supply and are controlled by central authorities.

In light of these developments, Trezor is launching a limited edition hardware wallet called the Trezor Safe 5 Freedom Edition to celebrate Bitcoin independence.

Bourdon concluded by encouraging users to “ignore the noise” and focus on securing their wealth through self-custody as a means of achieving financial sovereignty.

At the time of reporting, the Bitcoin (BTC) price was $101,369.