CULTURE: How to Protect Yourself from a Crypto Kidnapping

Summary

Blockspace: AI & Bitcoin
Episode: CULTURE – How to Protect Yourself from a Crypto Kidnapping
Date: March 6, 2026
Guests: Chris Cedor (Founder, CDOR and Bitsurance)
Hosts: Charlie Spears & Colin Harper

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Episode Overview

This Blockspace episode dives deep into the persistent and evolving threat of crypto-related physical attacks—ranging from phishing to home invasions and kidnappings—linked predominately to Bitcoin self-custody. Hosts Charlie Spears and Colin Harper welcome Chris Cedor, meme-maker and founder of CDOR and Bitsurance, to unpack best practices in personal and operational security, advances in wallet technology, the risks (and mitigations) of self-custody, and the profound security implications posed by AI-powered scams. The conversation balances sobering statistics and chilling anecdotes with practical solutions anyone can implement to drastically reduce their risk surface in the “Wild West” of digital asset sovereignty.

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Key Discussion Points & Insights

The Rise in Violent Physical Attacks on Bitcoin Holders

• A Record Year for Attacks (00:00):

  • 2025 was “the most violent year on record for crypto and Bitcoin-related physical attacks,” including home invasions and kidnappings. Over 74 documented cases, a 70% jump from 2024. “Half of those involved violence and torture.” (A, 00:00; B, 00:50)

• Attackers Evolve:

  • No longer amateurs; organized crime networks and sophisticated hackers have entered the space:

    “Now you’ve got like actual criminal enterprise... executing these attacks.” (B, 13:52)

• Correlation with Bitcoin Price and Publicity:

  • "There’s a direct correlation with the bitcoin price. Everyone vocal about bitcoin with a public persona becomes a lucrative target." (A, 11:33)
  • Even bragging about holdings on social media can draw unwanted attention.

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The Self-Custody Landscape & Common Pitfalls

• Custody Models Explained (05:21):

  • Exchange custody is vulnerable to external risks (“Sam Bankman-Fried can run off with it... Coinbase can close your account.”).
  • Self-custody gives the user full responsibility for securing private keys—no customer support or hotline in case of error.

• Hardware Wallets vs. Metal Backups (05:51):

  • Hardware wallets: Dedicated, minimally-functional devices that keep keys air-gapped and minimize digital attack vectors.
  • Metal backups: Fire/flood-proof, physical record of the wallet seed (private key) for disaster recovery.

• The “Petty Cash” Principle (08:25):

  • Use hot wallets for small amounts (“don’t have more than €500 worth of bitcoin on a hot wallet”), migrate larger holdings to more secure cold or hardware wallets.
  • Simplicity and regular testing (“wipe the wallet again and just recover from the backup... if you do this from time to time, then you can go into multisig”). (A, 08:25)

• Overcomplication Is a Trap:

  • Many make mistakes by overcomplicating self-custody (complex “crypto” schemes, seed obfuscation, etc.).

    “Keep it simple, you’re not special.” (A, 08:25)

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Expanding Risk: Social Engineering, Phishing, and AI

• Physical Threats Meet Digital Deception:

  • Not all risk is physical; phishing (especially via sophisticated AI-generated lures) is on the rise.
  • Real-life examples:
    • “He was basically one shotted by North Koreans. Sent a fake zoom link ... there was a video of another person... tricked him into giving access.” (A, 17:33)
    • Deepfakes, AI voice/video fraud, and elaborate fake conferences lowering the bar for scammers (19:27, 20:51).

• AI Shifts the Security Asymmetry:

  • “The asymmetry to use Internet safely is gone with AI.” (B, 18:43)
  • Attackers’ capabilities now match—and often exceed—users’ defenses:

    “Any script kitty can now create a fake website and ... really scarily good video and forgeries.” (A, 19:27)

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Operational Security & Social Practices

• Reduce Your “Risk Surface” (16:21):

  • Avoid publicizing holdings; don’t brag about your bitcoin (“don’t be as stupid as Charlie and I and talk about it and be public about it”). (A, 16:21)
  • Street smarts: “Don’t go bragging ... on Instagram ... people have been targeted... even just lying about holdings.” (A, 16:21)

• Beware of Social Engineering:

  • “I am constantly fending these things off ... still regularly catch myself.” (B, 17:11)

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Advanced Custody Models and Modern Wallet Design

• Spectrum of Security:

  • Self-custody is binary (you have the keys or not), but security is a spectrum—multi-sig, time delays, and geographic key sharding can dramatically reduce risk.

    “If you are able to spend your bitcoin quickly then you already have a security problem.” (A, 21:46)

• Blended Self-Custody, Insurance, and Miniscript:

  • Insurance is a final backstop, but technical solutions offer the most robust security.
  • Miniscript wallets allow extremely granular control over keys (“time decaying or time expanding setups,” “amount of redundancy and levels of security that no custodian can provide to you”). Can be built with ~$400 of consumer hardware for anyone. (A, 21:46)

• What is Miniscript? (24:09):

  • Subset of Bitcoin’s script language enabling easy, safer custom multisig and conditional spend policies.

  • “Bowling with bumpers”—can build custom wallet logic (“inheritance,” multi-stage approvals, delays after loss/theft) without risking self-lockout.

• Bitcoin vs. Other Chains:

  • Attacks like the 2025 Bybit/Gnosis Safe hack possible on Ethereum (due to lack of native multisig, requiring “blind signing”), much harder with bitcoin’s native features. (A, 26:31)

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Future of Bitcoin Self-Custody: Soft Forks & OpCodes

• Covenant Proposals:
  • New opcodes (checktemplateverify, templatehash, etc.) could enable “reactive security”—outflows only to whitelisted addresses, velocity/magnitude controls, transaction “punish” buttons for active defense.

    “Currently, proactive security... If something goes wrong, you’re fucked. ... With a covenant, you could have... something like reactive security.” (A, 29:22)

• What’s at Stake:
  • Widespread adoption of new security models could massively decentralize custody and drain major exchanges—improving overall ecosystem risk.
  • Pushback from those “afraid of spam,” but “spammers will always find a way” and blockers often misunderstand the enormous security upside. (A, 32:48)
  • “There are two people, ones that want covenants and those that do not know what covenants are, I believe.” (A, 34:55)

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Notable Quotes & Memorable Moments

• “You can do this with like $400 of consumer grade hardware and a miniscript wallet that requires you to have a lot of co-signers. With miniscript you can have these time properties and they’re not enforced by a company.” (A, 00:00; repeated at 21:46)
• “There were over 74 documented physical attacks against bitcoin owners last year. This is up 70% from 2024. Yes, the criminals are stopping at nothing, not even kidnapping, cutting off fingers, and in some cases even death. They want your bitcoin.” (B, 00:50)
• “I always say keep it simple, you’re not special. And from time to time, it’s worthwhile to revisit a backup...99% of people should be fine with a single-sig signer.” (A, 08:25)
• “If you are able to spend your bitcoin quickly then you already have a security problem. ... Your imagination, there is no bound to that.” (A, 21:46, 24:09)
• “Every time you send a UTXO...if something goes wrong, like you’re fucked...” (A, 29:22)
• “There are two people, ones that want covenants and those that do not know what covenants are, I believe.” (A, 34:55)

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Key Timestamps for Important Segments

| Timestamp | Topic/Quote | |-----------|------------------------------------------------------------------| | 00:00 | Statistics on violent crypto attacks, advanced wallet overview | | 00:50 | 2025 attack stats: 74 incidents, 70% jump, real physical violence| | 05:21 | Hardware wallet basics and risk of relying on exchanges | | 08:25 | Self-custody pitfalls and “petty cash” approach | | 11:33 | Increasing criminal sophistication and attack data | | 13:52 | Organized crime and targeting public figures in Bitcoin | | 15:51 | Case study: French IRS leak, targeted attacks in France | | 16:21 | Public persona risks and the importance of discretion | | 17:33 | Phishing, Zoom hacks, and personal anecdote about a North Korean attack| | 18:43 | AI lowers attacker barriers for social engineering | | 19:27 | Fake conference scams, live video deepfakes | | 21:46 | Multi-sig, insurance, and spectrum of self-custody | | 24:09 | Miniscript: what it is and how it helps | | 26:31 | Other blockchains’ failures with multisig security flaws | | 28:43 | Bitcoin script, vaults, and soft fork improvements | | 32:48 | Spam, covenants, and debate over protocol upgrades | | 34:55 | “There are two people...” quote; final thoughts |

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Closing & Where to Find Chris

• Chris Cedor’s projects: cdor.io, bitsurance.io, Twitter/X: @Coinjoint (35:13)
• Next appearance: Las Vegas conference (35:13)

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Summary Takeaway

Self-custody is at once liberating and dangerous: it gives holders unprecedented control but also unparalleled exposure to innovative, sometimes brutal, forms of attack. As both physical and digital threats rise—fueled now by AI—Chris Cedor and the hosts urge users to balance simplicity and technological sophistication. Concrete steps—hardware wallets, robust backups, multisig, and the next generation enabled by Bitcoin protocol upgrades—offer powerful defense, but operational discipline and discretion remain critical. The next evolution in custody, powered by the Bitcoin protocol itself, is coming—and with it a substantial leap forward in user security.

Transcript

[A]

Just last year was the most violent year on record for crypto and bitcoin related physical attacks. Not just phishing, but like actual home invasions, actual kidnappings, half of those involved like violence and torture. And you have the ability specifically with bitcoin to have really secure multisig and time decaying or time expanding setups that give you such an amazing amount of redundancy and levels of security that no custodian can provide to you. You can do this with like 400 bucks, like consumer grade hardware and a miniscript wallet that requires you to have a lot of co signers. With miniscript you can have these time properties and they're not enforced by a company. You can have bitcoin multisig natively, something that most chains can't do.

[B]

There were over 74 documented physical attacks against bitcoin owners last year. This is up 70% from 2024. Yes, the criminals are stopping at nothing, not even kidnapping, cutting off fingers, and in some cases even death. They want your bitcoin. Maybe the risk isn't a wrench attack, but rather your own forgetfulness and accidents. I have an expert on all these topics, Chris, who has a company which specializes in products which reduce your surface risk area. Blockspace is brought to you by CleanSpark. Let's kick it off. Hey, Charlie here. Guess what? We just announced our next bitcoin technical conference. Op next.

[C]

That's right y'.

[B]

All.

[C]

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[B]

We are hosting the big names and projects that you recognize like Robin Linus

[C]

of bitvm, Nick Jonas of Blockstream, Antoine Ponceau of Chaincode Labs, and Kale of Bitchat will also be present.

[B]

And this isn't just for the devs. We have institutions talking with the developers. That's what up next is all about. We have Robert Michnick, head of digital assets for BlackRock in the building. We've got folks from mining pools, investor funds, bitcoin startups and other groups with

[C]

a ticket of course, you'll get access to all the high signal programming and networking you could want. You'll also get coffee, catered lunch and access to the the afterparty at Pub Key. If you want to go vip. You'll also get access to the speaker dinner following the event and an investor brunch on Friday.

[B]

Tickets are capped at 300 and early bird tickets are already sold out. If you want to save yourself a spot, go to opnext.dev that is O P N E X T.dev use code podcast to save 20% off a GA ticket to the event.

[C]

Ticket prices go up every few weeks, so don't wait. Y' all lock in that ticket today day.

[B]

We'll see you April 16th at the time center in New York City. They are coming for your bitcoin wrench attacks, phishing attacks and the risk might actually just be yourself and accidents you might make. I've got one of my go to sources for things on bitcoin self custody coin join Chris, otherwise known as Chris Cedor. Welcome to the show, Chris.

[A]

Thanks for having me.

[B]

So a lot of people might know you as like the guy who makes goofy funny memes on Twitter, but I was looking it up. You actually have a real job apparently. What do you actually do, Chris?

[A]

So what do you actually do? Like good, good question. So yeah, memes take up a large part of my day and I enjoy them the most. That is my ikigai, specifically bitcoin memes. Like I tried to keep it in the infotainment sphere. It should be educational and funny. It's an acquired taste. But I digress. So I own the company cdor where we do bitcoin self custody solutions and I run Bitsurance where we are the world's first bitcoin insurance and self custody where we also do onboarding for HNIs for companies and we focus on insurance and inheritance. So deep in the bitcoin rabbit hole

[B]

and for the average pleb, you guys have a really cool product which is the classic. It's like the sleeve of like metal things you can stamp your seed phrase on. Oh, you've gone right there. Yeah, of course.

[A]

I'm media trained. I came prepared. It's a stainless steel tube. It has up to 40 disks in there. You can emboss your private keys. I'm a big proponent, big fan of if you have bitcoin and it should be in self custody, that the backup should be self explanatory and that there is as much information as possible in there by trade. I'm a mechanical engineer. I did not invent the steel wallet even though I'm German. But there have been other products out there before and none of them satisfied me and my business partner Ayhan and I, we set out and designed something new. And yeah, it grew from there and it's now a full time job which is like amazing. I always wanted to have A bitcoin job and I just made it for myself. And yeah, this is a solution that people take a liking to and yeah, have been doing this for six years now.

[B]

I think maybe a little bit of preface on just the landscape of hardware wallets, even what they are, because again this is a bit like of a Bitcoin 101. But there's people listen to this on like Yahoo. Finance and Coindesk don't really. Maybe they own like metamask on their wallet, like on their phone. How do you explain the difference between like a hardware wallet like a Trezor or a ledger and a physical like stamped metal wallet backup?

[A]

So yeah, I mean if you own any kind of digital currency, you can have it on an exchange, then Sam Bankman Fried can run off with it or like Coinbase can close your account. That's why you take it instead of custody in your own possession. That means you have the private keys and that can be a software wallet like a lot of people use Rabi and Metamask and that is a hot wallet on your computer. Your computer's connected to the Internet and everything that has Internet access that eventually can be hacked. And that is not a secure way for big amounts of cryptocurrency. And yeah, in 2013, Trezor, they invented the hardware wallet. This is the Swiss manufacturer, this is bitbox, they have these small, let's say dumb computers, you can plug them in and they have a very small set of functions and therefore the entire area that you need to protect against attacks is very small. This thing generates a private key completely new, only you have that. And it signs transactions and creates addresses for you to deposit Bitcoin, other cryptocurrencies. And this essentially air gaps that private key information. And with all like digital things, they can break. Like there's a screen on there, there's a capacitor. Like these things, they should last a while, but if they break, it's good to have a backup. And that backup should be absolutely offline. So the first thing you do is write it down on a piece of paper with a pencil and yeah, that is a good backup. Paper can break, can burn, can get wet. The next step, if your holdings are a little bit larger, get it on something fireproof and yeah, then you're good to go for most kind of scenarios because with self custody you have this responsibility yourself.

[B]

I think one thing that trips people up is because it is kind of a mental leap to take your bitcoin off an exchange, put in self custody, but then What I've discovered in my own years of trying to hold people's hands through this process is I think the average person doesn't naturally understand like different risk surface areas. I found that there's, there's often an over indexing or overconfidence in like their own like self custody setups. How do you like often, how do you like describe, how do you like properly repair, like prepare someone to like understand the risks and like mitigate some of the edges, the rough edges of self custody.

[A]

Yeah. So when people start out with it, you need to have the confidence to become the bearer of your own keys because there is no hotline. You can't call somebody if something goes awry. It used to be much more difficult. Nowadays it's as easy as getting one of these. Plug it in, confirm the address, learn that there is a screen on there that cannot lie to you. And if you confirm this address then you can send your bitcoin there. But before I go to that step, I would start out with a software wallet on a phone so that people get used to it and there is a whole bunch that you can have. And like I think Andreas Antonopoulos compared it to like there is this petty cash approach where like you don't have more than €500 in your, in your wallet. So don't have more than €500 worth of bitcoin on a hot wallet. And then your savings and larger sums, you migrate to this and then people tend to overcomplicate things because they think, okay, I need to roll my own crypto, I need to protect my seed phrase. Instead of having it like humanly readable, let's do a shiftre. And these usually are then the trappings where people stumble over their own scheme that they devised. So I always say keep it simple, you're not special. And from time to time it's worthwhile to revisit a backup. And it's also a good practice. If you set these wallets up before you transfer bitcoin there, wipe the wallet again and just recover from the backup that you created so you know that the backup there has been not made a mistake. And if you do this from time to time, then you can go into multisig and like even more secure setups. But like 99% of people should be fine with a single sig signer.

[D]

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[B]

into, I think, some more salacious, fun conversation, which is like the landscape of what like of how you assess your risk. Surface area is changing because the attackers are getting much more sophisticated. It's in the news way more than ever now about phishing scams and physical attacks. And this is something bitcoin has been talking about a lot and been pontificating on endlessly about. How do you resist these things? And while they have always happened, it seems like they're ramping up significantly. What are you seeing happen in like the physical and phishing attack space right now? Where do you see like is like? Is my subjective assessment that this risk is like increasing, that these activities are increasing? Is that correct?

[A]

So that is not just subjective, but like we can objectively look at the data and friends of mine, Max and Elena from Gart, formerly known as Glock, they just had to rename because of some Austrian company. But I mean you are the product of an American high school. You are familiar with those. So they, they are rebranded to Guard and they, they have a scientific analysis of like the documented crypto and bitcoin related physical attacks for the last 10, 12 years, I think. And there have been like a few hundred. And like just last year was the most violent year on record for these kind of things. Not just phishing but, but like actual home invasions, actual kidnappings. Half of those involved like violence and torture and even like 1 in 10 kidnappings ended in like a fatality. So if you look at it, there's a direct correlation with the bitcoin price. And everybody that has been like vocal about bitcoin or has like his personality attached to bitcoin and people can go back and see, hey, this guy was on Reddit in 2017 and posted about bitcoin. And since then bitcoin has done 100x in price. That is a very lucrative target. Like I always say, I'm probably by far the poorest person in my neighborhood. They're all richer than me. But by the amount of money that you can like beat out of me, I'm probably number one because with self custody bitcoin you have access to your keys, you can be coerced. And yeah, this Guard analysis is quite interesting. Like I have these conversations again. I'm also in the business of ensuring bitcoin in self custody against robberies. And I have a lot of people tell Me, Yeah. For that reason I do not take my bitcoin into self custody because it's much more difficult for people to rob Coinbase by Coinbase account and that has not proven true. So people can coerce you to log into your Coinbase account or like even send money there and withdraw crypto and or like you lower the security settings, like it doesn't make any difference. So like there is absolutely no upside to having a bitcoin on an exchange. Good operational security is important and again it is a very lucrative asset. And like from These I think 305 cases that they looked at, two thirds were like successful from the viewpoint of the attacker, which is scary. So yeah, this landscape has changed and

[B]

these guys are getting really sophisticated. Like maybe it was a friend of a friend who is hostile, saw an opportunity back in the day, but now you've got like actual criminal enterprise organized crime which executes these attacks. Like that's one of the things revealed in the report you referenced, but also other like you know, news stories. I mean what's going on?

[A]

Yeah, what's going on? I mean again bitcoin is lucrative and like it has many great upsides. But bitcoin transactions are final. Once you send them, you cannot unsend them once they're broadcast and mined of course. And those sums like they are like considerably large. Like just beginning of last year, one of the founders of Ledger, like it's a billion dollar company, he's no longer with the company, but I'm sure he has some bitcoin. And he was abducted in his home like near Vierzon, like David Ballon is his name. They mutilated his hand, they abducted his wife, left her in the trunk of a car for like two days. Luckily to my surprise, the French special forces like the GN, like managed to free him. And the robbers were very stupid in the regard that they initially asked for 20 million euros in bitcoin and then they were negotiated down to like another sum in tether. And tether is a cryptocurrency that you can seize and freeze. So they didn't make far with that. And yeah, that is France, like in France alone, that is like the country right now with the highest number of robberies and like abductions. And that is also due to a very scary fact. There was a employee at the French IRS that was selling not just cryptocurrency holders addresses, but also from famous people for as little as €800 a pop, like that information. And then like gangs like you know, use that Information to specifically target people. Very sophisticated. And. Yeah, what are you going to do if somebody kicks your door in?

[B]

So that gets back to like, risk surface area. Because I, you know, I want to, like, pull back and ask, like, should the average person be concerned about these physical attacks? Again, this is a bit of a qualified statement. Depends where you live. Depends on, like, how public you are. I don't know, like, how do you, you know, how do you accurately frame somebody's mindset to appropriately consider that risk surface area? Yeah.

[A]

Always say, like, don't be scared, but be mindful. Have good operational security. Don't go bragging around about your holdings. And the number one thing that you can do, don't be as stupid as Charlie and I and talk about it and be public about it. Like, we will come to regret this, likely. Like, so if you. I'm not going to say, like, don't go to a conference or a meetup, like, you can still do that. But, like, don't go bragging about your newfound riches on Instagram because there have been cases where people have been targeted specifically for that. And then it turns out, oh, this guy, he was just actually lying about his holdings, but he was still hurt, he was still abducted. Yeah. So there's a new wave of super sophisticated first off, like, robbers, but also hackers. Like, I mean, you've probably had a few fake zoom call invites in recent past the time.

[B]

I am constantly fending these things off. I've even like, put stuff on my. On my calendar. Like a call that. Oh, sure, I'll hop on a call and then I'm about to like, jump in. I'm like, no, that's a. That's a big call. So it happens to all of us. And I'm a. I'm a denizen of the Internet. Like, I'm used to this and it still. I still regularly catch myself having to.

[A]

Yeah. Even if you're, like trained in all of these scams and like, you are very well aware of, like, all these things that are possible sometimes maybe you didn't have your coffee, you were not really awake, and then suddenly you click on a link or like you put something in a terminal. Like, I think Knut Swanholm and Lawrence Leppert and like the guy Martin who organizes the biggest European bitcoin conference. Like, he has been in the space for ages, and he was basically one shotted by North Koreans. Like, they sent him a. A fake zoom link. There was a video of another person he was intended to meet there, and he pretended to have audio issues. And then in a moment of lapsed judgment, he gave basically a North Korean hacker group access to his computer. And then they had access to his telegram. And from there he essentially had to warn a lot of other people through that. I had suddenly a contact from a person that I had previous contact with. Not something fake, but his actual telegram account messaged me, hey Chris. And it sounded like him. And it was really sophisticated. And the barrier to do that, like with AI, it's getting so much lower.

[B]

Yeah, I want to get into that because this isn't an AI podcast. Narc is not an AI conversation.

[A]

We are not a rabbit hole recap.

[B]

No, we're not. We're. That's another topic. But AI does change the landscape. It totally changed the risk surface area because now the ace. I think it's like the asymmetry is different. Like historically it's been like pretty asymmetric to execute a lot of these phishing attacks. And it seems to me that they're. That we're heading to an era where like the existing like ways that you interact with the Internet are very different. And the asymmetry to like use Internet safely is like, you know, versus your effort versus the attacker's effort. The asymmetry is gone with AI. I don't know, what are your thoughts on this?

[A]

Yeah, I mean any script kitty can now create a fake website and create with like just a few clicks and maybe a €10 subscription a month, like really scarily good video and forgeries. And like, I mean I was contacted by a guy from the Czech Republic and said hey Chris, I saw there's like a bitcoin conference in Hamburg in Germany and I saw you were a sponsor. Is it worth it to go there? And like, hang on, I'm not familiar with a conference like in Hamburg and I'm not a sponsor and was a full on website with a fake conference and somebody was charging like €300, which is like a realistic amount and he was requiring payment in bitcoin for a fake conference with like a full on fake website that was like probably better than my website. And like the barrier, like, I mean if you have this kind of talent and the tenacity and like you manage to like there is an opportunity to earn an honorable legal living instead of scamming people. But yeah, I was taken aback. Like you can fake video in a live call now. Like you can pretend to be a woman. You can like not just catfish people, but people could pretend to be you because like your data has been Leaked and somebody will pretend it's you and go into your Binance account and pass video identity. Like I'm pretty sure we are at that level right now and it's only going to get scarier in the next couple months.

[B]

Yeah, and this might. I'm just going to hand you a easy layup here which is like you can do the self custody thing. We all recommend advocate for it but there are further steps you can go to add like conditions to these like various levels of self custody. Because it's not a binary thing. Self custody is kind of a spectrum. This gets into like the blended self custody models you might call. Like there's insurance models and stuff like that. How do you like talk about this kind of out. I'm calling it like the in between area of like not fully self custody of different co signers. You have insurance, we have new products like miniscript. I don't know, like how do you think about this? How do you think about like this beyond just having a single seed phrase buried under your bed?

[A]

Yeah, I mean as you said like self custody I think is binary but you can have security on a spectrum. Like you can go to great length and if you are able to spend your bitcoin quickly then you already have a security problem. Like you yourself should not be able to spend your entire stack that you plan to retire on in the future. Like there should be multiple keys or there should be like you need to travel somewhere or like you can't have like everything on a single stick if you plan to really like in 10, 20 years or so to retire on that. And again I'm an insurance salesman as is Rob. But I think we agree that insurance is not the strategy. It's like the last line of defense you're trying to like this is the last puzzle piece before then like you have really the ability specifically with bitcoin like to have really secure multisig and time decaying or time expanding setups that give you such an amazing amount of redundancy and levels of security that no custodian can provide to you. I always say I give these talks just a couple of days from now on the 8th of March Women's Day, I do a workshop for two hours with a title store. Your bitcoin more secure than Michael Saylor because that guy like he has his coins like split on fidelity and coinbase and like he is, I don't know if he ever like held a key and like he is at the behest of the American government essentially and the trick to store €10 worth of Bitcoin or like $10 billion worth of Bitcoin can be the same. You can do this with like 400 bucks of like, like consumer grade hardware and a miniscript wallet that requires you to have a lot of co signers. They can be geographically distributed. With miniscript you can have these time properties and they're not enforced by a company or like some roadblock, but purely by like a set hash of hash rate in our network. Like you can have bitcoin multisig natively, something that most chains can't do.

[B]

Yeah, I actually want to double tap on that and I invite you to get a little more deeper into the actual mechanics of the miniscript or just like different co signers. What I guess like maybe for the person who doesn't know this, like what's actually happening and then like how does this mitigate the threat landscape?

[A]

So yeah, Bitcoin has a scripting language called Bitcoin script and we have not scratched the surface with what we can do with that. Like the Lightning network is built on that, a regular multisig is built on that. And very smart people like Sanghit and Peter Walle and Polstra, they came up with something called miniscript. It's like a subset of these script like opcodes and they are arranged in a way like Rob Hamilton calls it bowling with bumpers. Like you can build wallets with miniscript without shooting yourself in the foot. Because if you use bitcoin script you can do a whole lot of things but maybe there is like some edge case and then suddenly you locked your coins until the heat death of the universe. And with miniscript those problems would not arise. And it's a very not easy but really smart way to build a wallet. And wallet software like Wizards of Dean Liana and Nunchuck and Rob Hamilton's Dryden Vault, they utilize that and they abstract everything away for you. It's as easy as setting. Okay, this is my first signing device, my bitbox. This is my second signing device, my cold card. If I lose either one of them, all I have to do is wait for a certain amount of time before I can just sign with one of these or before like from this two or three, it decays or expands to a two or four. Like you can change these quorums and like your imagination, there is no bound to that. Usually when I do these onboardings for people, like there's three different types of wallets that we set up like for inheritance and for different companies and that has Been such a game change and Bitcoin like I think it's three years now since we have this capability and yeah, more people should look into that. And again that's the great thing about it. It's free, it's open source software and you can do it yourself with consumer grade hardware and you have again the most secure setup.

[B]

Yeah, it's really interesting because I'll talk to other folks from other chains and it seems like other blockchains have invented more complex and sophisticated ways for them to rug themselves in like various self custody. You had the billion dollar hack last year on, on Gnosis fault.

[A]

Yeah.

[B]

And it's kind of, and it's funny because you like look at that. And while that could happen on bitcoin, it wouldn't happen. It's like the, the, the risk surface area for that specific tactic is much lower especially given like the. I say I see one maybe want to say something about that?

[A]

Yeah, I want to say so to, to break a land. So like the, the hack that you have been referencing was like 1.5 billion in Ethereum from Bybit and what they did, they used. So there is no native multisig on Ethereum. You need to lose like a layer two like Agnosis in that case or like safe that essentially they use ledger devices and because the amount of data that you need to sign is not made for these small devices but the small storage one that they have. Essentially you're blind signing. You're looking on a screen, hey, do you want to sign? And when you set up the wallet it tells you you have to set this up for blind signing. Which entirely defeats the purpose of having a hardware signer if you anyways like just trust your computer. And in that case I believe it was also the North Korean Lazarus group who did like a man in the middle switcheroo like pretended, okay, this is the address you want to send a small amount to when in fact you're currently signing to send all of your stack to our address from where they then you know, switch it into Bitcoin. But it also can happen with bitcoin. Like there was an Exchange I think DMM in Japan that was like $300 million worth of Bitcoin were stolen from a multisig to a poisoned address. Which to this day I'm still not quite sure how that could have happened without like some serious inside job. But yeah, again with large amounts you just compare the entire address, not just the first couple few letters and call it a day. But again best practices and one Thing that I might also want to add. Like in all these things you get a lot of emails that are like phishing attempts that tell you it is urgent, you need to act now there's a firmware update. Never, not once in any time. There's never any urgency. Your coin on a hardware sign in device are super secure. You can only move them if you physically touch this device. And that is what a lot of hackers and scammers rely on, that they dupe you into in a rush, urgently move your coins or do anything erratic usually or like 100% of the times you can just chill and wait and have another look and do not trust any email that comes into your mailbox.

[B]

And this gets into. So like Bitcoin, you're talking about Bitcoin script and the capabilities Bitcoin has, how it's differentiated. We still have a lot of exploration development to go given Bitcoin's current existing capabilities. But this gets into improvements to how Bitcoin itself can improve the landscape of self custody which gets into soft forks opcodes. How do you describe some of the like what the some of these proposals do and do you think self custody improvement is compelling enough to get some of these opcodes further along?

[A]

So in my opinion, 100%. So currently we are dealing with a contentious soft fork proposal that wants to mitigate spam. If you have a cursory glance at the mempool, the mempool is empty. So any miner is probably welcoming if somebody pays any transaction. And my reading of that is Bitcoin from the UX standpoint is not there yet to scale to the normies, to have a natural demand for scarce block space. And if we had that, we would like two birds with one stone, we would take care of the spam because any financial transaction prices out these zero or negative sum games. And yeah, with something like a Covenant proposal, there is a whole bunch of them from like check template verify to template to tx #. If we manage to get one of those, we can improve self custodial lightning. We can improve bitcoin self custody in a way. So currently we have something. It's basically proactive security. Like you try your best to keep your 24 words really secure that only you know them. And if something goes wrong, like you're fucked every time you send a utxo like in Bitcoin you have not a balance but an entire utxo. Like you send all of the UTXO and then get a change output back and things can go wrong there. And that is like not a really for a normie, a difficult concept to grasp. Like, if I have a big bucket of gold, why would I every time dump it all out and then hope that a change output with like my wallet change returns eventually? And with a covenant, you could have something like velocity, you could something like reactive security where you can only spend like velocity and magnitude, like certain amounts during a certain amount of time. Or if something from like, I have this super secure bitbox and from this one I can only spend to my hot wallet on Kraken, like to this whitelisted address. If I spend it to any other address or a hacker does that, I have this big red button that I can push and that will punish the transaction and cloud back. These things can be built with covenants with these vaults. And I think that should be one of the next soft forks with the great consensus cleanup coming up. Maybe afterwards we get like template hash or like one of these. I am a big proponent and again, I'm arguing against myself. Like, if we had something like this, it probably would impact my steel wallet business because again, we can make it easier and better. So this might not be necessary in

[B]

the future, but at the same time, it arguably enhances the insurance business because now you have more sophisticated insurance products you can build and risk models, I assume. Maybe I'll. I'll throw a spicy question at you, which is. So there's a lot of people who hate spam. And for some reason, these people have started aligning themselves against some of these soft forks, whether they know it or not. Because these soft forks might, God forbid, allow spammers or new types of like, fun ways of using Bitcoin. They might give them a few more tools. How do you respond to people who are opposed to what I consider to be pretty obvious improvements to Bitcoin, but maybe they give spammers a couple more tools to play around with.

[A]

Spammers will always find a way, not to quote Jurassic park, like there is currently. There's a myriad of ways where you can embed data into Bitcoin and you can't even enumerate that. Like, there are so many ways to do that. And it is a unwinnable cat and mouse game because again, the mouse wins in that scenario. And with a covenant, of course, people are arguing, okay, what if we do? What if we don't? And there are unknown unknowns on both sides. And because you cannot quantify them either if we do it or either if we don't, you can assume they cancel each other out And I believe we have talked about CTV for like many years now and there's a big bug bounty and nobody has found a way to one shot that and it has been live on other chains. I always say like bitcoin cash is like a very big bug bounty for CTV and we can essentially ship it. And the thing with spam is, or to quote Greg Maxwell, there is an infinite demand for place or like block space that is stored forever for eternity at a low price. That is the important distinction because it doesn't make any sense. You have to pay millions of dollars worth of bitcoin to store a gigabyte on the bitcoin blockchain. Whereas you can do this really cheaply like right now for hundreds of years for less a fraction of that. Like to store a gigabyte is really, really cheap. And as soon as we generate this demand, I truly believe that if we built with covenants, better self custodial lightning, better layer twos, better reactive security, more people will take their bitcoin off coinbase decentralizing like lump risks that we have in these big exchanges, they would be rocked entirely because people would not see the value of that. If you can have a proper vault where you can have shared custody of a utxo, where you can have reactive security. And yeah, I mean people are scared from things that they do not know or understand. There are two people, ones that want covenants and those that do not know what covenants are, I believe.

[B]

Chris Cedor everybody. Chris, thank you so much for coming to the podcast. Thanks for entertaining some of our one on one questions about bitcoin self custody. And where can people find you and where can people buy one of those goofy sleeves of metal they can keep their bitcoin on forever?

[A]

So cdaw, IO Bitsurance, IO, those are my companies. You can find me on X at Coinjoint. You can find me. Yeah. Next conference in the United States, I will be in Las Vegas. Come say hi. You might be surprised. I'm very tall but I don't bite.

[B]

Everybody knows that by now. You've, it's, you're that guy in the corner at the party saying nobody knows I'm tall, but everybody knows you're tall.

[A]

It's all we know about you. Foreign.

[B]

Hey, this is Charlie and Colin from Block Space Media and you're listening to the Block Space Podcast, a show about emerging tech in Bitcoin, AI energy and markets.

[C]

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[B]

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[C]

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