Due to how the FTX ordeal played out and left investors high and dry, there is no doubt that the sentiment surrounding the cryptocurrency market has soured, as investors are withdrawing their funds from digital assets. Industry leaders have reemphasized the value of self-custody of cryptocurrency assets in light of the situation. Changpeng Zhao, CEO of Binance, recently referred to self-custody as a "basic human right" in a tweet. The CEO of MicroStrategy, Michael Saylor, has also previously advised cryptocurrency investors to maintain ownership of their assets.
In order to better understand how self-custodial tools and technologies function, Zhao advised individuals of the cryptocurrency community to start keeping custody of tiny amounts of assets.
After Sam Bankman-FTX Fried's cryptocurrency exchange lost credibility due to liquidity and solvency issues, bitcoin plummeted to a year-low.
Trust Wallet, which is owned by Binance, saw a spike in investor traffic in the midst of the market volatility.
Trust Wallet, which was purchased by Binance in 2018, is a decentralized hot wallet service that enables users to store their cryptocurrencies and NFTs. Hot wallets are available online and allow cryptographic transactions between their owners and end users thanks to a number of private keys that are kept there.
According to a Coindesk story, the Trust Wallet Token price increased by 80% recently, reaching $2.3 (approximately Rs. 185).
A minimum of $1 billion (approximately Rs. 8,113 crore) in customer cash are said to have disappeared from the defunct cryptocurrency exchange FTX.
Therefore, it is anticipated that in the wake of the FTX debacle, the idea of "not your keys, not your coins" may become more widely accepted.
Simply put, it means that investors do not truly "own" their cryptocurrency if they do not have access to their private keys. Users of self-custodial wallets are not dependent on any cryptocurrency exchange or wallet provider to store their private keys on their computers, making them an easy target for hackers or people facing a liquidity shortage.
Ledger, a French company that makes hardware cryptocurrency wallets, previously asserted that one of its goals is to educate as many people as possible about the benefits of private and self-custodial crypto wallets.
