What practices do you take to practice self-custody?
We have heard the saying before: not your keys, not your crypto. Self-custody is a core tenant of why people choose to use and interact with cryptocurrency and demands that one knows how to self-custody their crypto responsibility in order to store it safely. In return, you have true ownership of your crypto and control your assets. There are several ways to self-custody your crypto and I was curious what methods you utilize to self-custody your crypto:
Background: For a long time I was too scared to self-custody my crypto, but with months of learning and reading I realized self-custody is the safest way to secure my crypto in the long-term, as no form of hot storage is truly safe – just look at Celsius, FTX, Ronin, etc… I decided to self-custody my crypto after A) reading and learning how to self-custody safely and responsibly and B) accumulating more crypto than I was comfortable with keeping on a centralized exchange
My system:
- Cold storage (2 wallets): Started first with 1 wallet for cold storage. I bought a second cold wallet after the cold wallet company's firmware update this spring started backing up our seed phrases (you know who I'm talking about).
- Seed Phrase (WRITTEN ONLY): I wrote my seed on a piece of paper that is stored securely in two locations that one other person I trust has access to. This way if my first location that holds my seed burns down, it is secure in a second location. Both are secured in fire-proof areas.
Ways to enhance and improve self-custody:
- Metal-punched seed phrases: I think this is my next step in self-custody. Stamping your seed phrase on metal plates secures seed phrase on more than just pen and paper – it prevents loss from flooding, fire, erosion. Stamping my seed into metal plates is my next step on my self-custody journey.
- Additional Wallets: If you have large amounts of crypto, having your crypto stored in multiple wallets helps avoid a loss of all your crypto if it were stored on one wallet and that wallet were compromised. However, you would likely need to store each wallet differently in order to legitimately do this, which could complicate your self-custody system.
- Multiple Seed Storage Locations: Storing your seed in multiple locations prevents loss of your crypto if one location is compromised, but opens you up to more points of compromise. I have considered safety deposit boxes, but that then puts custody at the helm of a bank, the exact opposite of what I have been trying to accomplish with self-custody.
- Use of a passphrase: Many wallets allow you to generate a passphrase in addition to your 24-word seed phrase. This protects you if someone accesses your seed phrase and does not know your passphrase. I want to do this but worry about forgetting or losing my passphrase. For me, it must be some phrase I can remember for life. However, a traumatic brain injury can even compromise this. There are always fail points.
Without exposing too much detail, how do you all choose to self-custody your crypto? Do you have specific techniques you utilize to better secure your self-custodied crypto like the use of pass phrases, multiple wallets, metal plates? Any other techniques I can consider not mentioned above to better self-custody my crypto?
submitted by /u/Cheese6260
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