Todd Argues Self-Custody Remains Superior Despite Coldcard $88M Hack

The recent Coldcard firmware incident, where hackers drained $88 million worth of BTC from users' wallets, has raised questions about the reliability of self-custody.

However, early Bitcoin developer Peter Todd argues that even such a significant hardware failure pales in comparison to the systemic risks posed by centralized platforms.

Todd points out that historically, infrastructure collapses of exchanges have cost investors many times more than any technical software defect. For example, the case of QuadrigaCX resulted in losses of $200 million, which is more than twice the losses from the Coldcard hardware failure.

The developer believes that the problem lies not with the complexity of blockchain architecture but with the absence of a basic culture of handling sensitive data. He compares securing personal funds to storing physical documents like a birth certificate, users need only write down 12 words and avoid losing them.