Only 1% of people can handle crypto self-custody right now: Binance CEO
Binance CEO Changpeng “CZ” Zhao has cautioned the crypto community about self-custody, suggesting that 99% of people choosing to self-custody their crypto will likely lose it one way or another.
CZ has been been a supporter of self-custody for years, referring to its as a “fundamental human right” but has always urged users to “do it right.” He published a “CZ’s Tips” on self-storing crypto in Feb. 2020.
During a recent Binance-run Twitter Spaces on Dec. 14, the Binance CEO continued to urge caution for those using self-custody wallets — suggesting that more often than not, security keys are not stored securely, backed up or properly encrypted, commenting:
CZ reiterated that holding crypto in one’s own wallet is “not risk-free” and postulated that “more people lose money holding their own — lose more crypto when they’re holding on their own than on a centralized exchange.”
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“Most people are not able to back up their security keys; they will lose the device [...] They will not have the proper encryption for their backup; they will write it on a piece of paper, someone else will see it, and they will steal those funds,” he explained.
The Binance executive also stated that even where self-custody funds are properly managed, “if a person passes away, they don’t have a way to give to their next of kin,” but custodians like Binance can implement a “standard operating procedure” to solve that problem, he said.
The Binance executive concluded that “different solutions have different risk profiles” and that it is up to the user to decide what is best for them.
Despite most of Binance’s
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