Topic: How bitcoin self custody will help reduce future bear market. (Read 250 times)

besides avoiding the hack, saving your Bitcoin on self custody where you save in complicated storage, it will make you a bit reluctant to send it to exchange. I experienced with it when bitcoin price currently rise, but because my wallet storage is bit complicated to access, so I postponed to sell it until the price is really high, or back to ATH. Because, I am one of people who bit paranoid with online, and I have to make sure it's really safe when access my wallet to the PC. I only have 1 where all my work is done there, so that situation, I must to check it again my PC is clear from virus on malware when connect to my custody wallet.

Bitcoin Self-Custody and the Impact on Future Bear Markets
Bitcoin's price volatility has been a hot topic of discussion in recent years, with some experts citing self-custody as a potential solution to reducing the severity of future bear markets. The argument is that by removing custody from third-party service providers and giving individuals more control over their own assets, self-custody could help to stabilize the market and prevent the extreme price swings that have been seen in the past.
This argument has its critics, who argue that self-custody is not a realistic solution for the majority of investors and could actually lead..


Bitcoin Self-Custody: Could It Help Stabilize the Market?
The cryptocurrency market has been notoriously volatile, with prices soaring and crashing seemingly at the drop of a hat. Some experts believe that if more investors used self-custody solutions for their Bitcoin holdings, it could help to stabilize the market and reduce the severity of bear markets. This article will explore the idea of Bitcoin self-custody and how it could help improve market stability.
Self-custody refers to the practice of taking direct control of one's own cryptocurrency holdings, as opposed to leaving them in the custody of an exchange or other..

It's not the centralized platform, but the sentiments of people attached to the market. This is what cause the bear market. Also, when there's a bull market, when it's over we will see a bear market. Because when the price reaches its peak, many holders will eventually sell to take profit from their investment. The more people sell, the more the price will drop.

So I am finding it hard to make a connection between bear market and centralized platform. Those incidents could let people to have less faith and many will sell to keep the asset as it is and not take a big loss. Don't get me wrong. Self-custody is a great thing either you do it for bear market or for your own good. It is always advised to keep your assets to yourself. But I don't think if a person keeps their asset to themselves in a self-custody but is unable to hold their emotion, despite having the asset into self-custody they will sell it. That's creating lower price in the market and potentially lead to a bear market.

Now you have said a beautiful thing that the importance of decentralized wallet or non-custodial wallet is immense to keep our funds secure. It is true that such large centralized exchangers have done a lot to promote the cryptocurrency or Bitcoin, but here it must have worked for their own personal interests.
Moreover, I think one more thing is that if the number of adoption of bitcoin is increaBecause many times it is seen that such big projects or companies are to manipulate the market pricesed by a general amount rather than a large organization, then I think it will be best. And in this case it can be seen that most of the users do not know about its usage types due to the lack of knowledge about Bitcoin.

Having your assets on a self custodian wallet is the best and most secured way to oritext your bitcoin holdings from thrid party manipulation and controls that can result into stolend of misused of your asset by the third parties just like in the xase with FTX and the rest of the other centralized exchange ls that have hard records of crisis like hack, exit scam and the rest.

If not for the purpose of trading, what on earth will my coins be doing on exchange,  where i know I don't have control of the wallets, such an approach is what has led many to lose huge amounts of what the cases of incident happen.


The best thing to do is to get your coins off the exchange because that is the only way to securely protect yourself from all such crises in the future.

The surge in the movement of coins from exchange into cold wallet came as a result of many loses associated with some of the exchange scams and hacks whcih have open people eye towards self custody and that is why there have been high percentage of such actions.


Investors are getting more aggressive in securing and protecting their investment and this will help rebuild the market i the short term and aslo reduce possible future crises that may come as a result of centralized exchange attacks.

Yeah, the crash of some centralized exchanges has prompted some people to always store their coins in a self-custodial wallet, which is the safest way to securely store their assets.

Well, even while some people stored their coins on the CEX, they were not trading them, which in any way did not contribute to how deep the bear market can go, so I don't think that if investors store their coins in cold storage, it will minimize or reduce the market crash. A bear market does not just depend on one factor, and that alone cannot be considered the only factor that can mostly play a part during a bear market.

There is always a Domino effect in trading that will balance its market.  I agree that fewer coins in exchange can trigger manipulation but the moment the price moves up, those who are holding Bitcoin looking for profit will start selling their holdings until the market price gets balanced.  This simply shows that moving funds out of the exchanges can't prevent a bear market because people have access to their coins and can easily sell their holdings any time they want to.

Bitcoin on its own can't slide in a bear market because Bitcoin is a bunch of code!
It's the people trading it who decide if it's going to be stable, in a bear or a bull market, and if people decide so it will make like zero difference if the funds are on a Cex or in cold wallets.

Now, the painfully to admit part is that having fewer coins on cex will also trigger more volatility and more pump and dump manipulations which will harm way more the price than what a cex collpase would ever be able to do. If you end up with 10 000 coins on all exchanges it will turn out worse than some $1k marketcap shitcoin manipulation scheme.


Me too, I blame this so-called trend of moving coins out of exchange on the inability of those chain analysis companies to track the movement of coins and their cold wallets, we know from fillings for over five years that Coinbase holds some 1 million coins for its custodial service but I have not seen one of those companies pointing out the addresses where those funds are stored.
Thinking of this, nobody knows where Salvador coins are held either despite the whole world talking about it.

Bitcoin price movement has two segment which is the bear market and the bull market. If all bitcoin investors keep their coins in a self custody wallet,we will still have the bear maarket because bitcoin price is controlled by economy factor,political factor and liquidity of the market. There must some circumstances that will make the bear market to prevail.

The bear market gives bitcoin the chance to start a new circle again,and the benefit of the bear market is to invest in bitcoin by buying at lump,and for those that haven't invested in bitcoin, it is an opportunity for them to buy at a low price. it is during the bear market that investors stash up their bitcoin portfolio to prepare their journey for the bull run. it is also during the bear market that holders will learn to be strong in holding their bitcoin irrespective of the price of bitcoin. So lets not see the bear market as a barrier to bitcoin price but a blessing for investors,especially long term investors.

That's not true. The Bitcoin price is (and always will be) determined by the trading volume of all crypto exchanges(most of them are centralized). The amount of BTC stored in cold wallets doesn't play any role in determining the BTC price.
More coins into cold wallets means less trading volume and market liquidity in the Bitcoin market. Less trading volume means that it would be easier for the price to drop, when there's a drop in the demand for Bitcoins.
There's no way for the Bitcoin price to become stable. The limited supply plus unstable demand are what makes the price volatile. It doesn't matter if most people are holding their BTC in cold wallets or hot wallets.

Not all of them per say, I was on my PC playing multiplayer game online and I meet different people through online gaming, we end up talking about crypto investment through proximity chat and I am not surprised to hear from two guys who still keep their Bitcoin on coinbase, one is from the United Kingdom and the other is from Canada.

Many people want to make money from crypto and when they are asked to create an account on a centralized exchange they always think it's the best place for their crypto, I tried confusing these guys to move their coins off the exchanges and they reply I got was that they believe it's less stressful and safe to leave their coins on the exchanges.

It seems that a lot of people use crypto exchanges like their local banks, and can't help but think that this is why they leave their coins on the exchanges, they simply trust centralized exchanges like they trust their banks.

People who hold their Bitcoin in non custodial wallet isn't entirely mean they will not sell their coins, you need to know if most people are holding their coins in Trustwallet and this wallet have an internal exchange. The only way to stop people to sell their coins if there's such time deposit like fiat, but it's not and that feature isn't good for decentralization.

Remember, Bitcoin price will not increase just because people are hold their coins, it also depend on the people who want to buy Bitcoin.

Despite what you mentioned, a crypto holder should be able to hold their tokens in a custodial wallet which will allow them to better manage their tokens and prevent them from risking that their tokens will disappear when the exchange goes bankrupt. It is true that using a custodial wallet is more complicated for some people, because they need to store their private keys properly to prevent hacking or other unexpected things, but storing crypto in a custodial wallet is much better than storing it on a centralized exchange.

Lol. I'm a lot more skeptical than you are about this. No matter how many scandals like FTX happen, most retail buyers of Bitcoin will continue to do it in centralized entities and many of them leaving them there, as they leave deposits in their bank.


We can see that there is a certain relationship, but I don't think it is the only one or that it is absolutely determinant in driving a bull or bear market.

The sole relationship is that when bitcoin holder store their bitcoin in a CEX exchange wallet, and anything happen along the line just like in the case of the FTX collapse the effect will hit the market in a negative direction immediately and the bear market will last longer and its impact on the investors can be worst since bitcoin holders not only stand the risk of losing their profits but can also lose the entire investment.


But if those Bitcoin are stored in a custodial cold wallet, even though such an incident happens,  the investors will only feel the impact in the short term,  because of market reaction but their Bitcoin holding will be protected since the BTC are in the investor's position and not on the third party wallet.

Market must have bull and bear years, you can not have bull years without any bear years because they have to co-exist to create an actual market. Capital must change hands among investors and it's like blooding movement in human body. Without it, the market will be dead.

Fiascos of FTX, Terra and some others are not real reasons of bear market. Without them, you will have something different that can be considered as reasons of bear market.

I agree if people are more educational about self custodial wallets and benefits, they will have better practice and don't take risk with custodial wallets. Even with better practice, bear market will not be eliminated. It's unrealistic to hope that the market will no longer have bearish years and it will grow steadily forever, exponentially forever.

Moving your Bitcoins from your wallet to an exchange, in my opinion, has no effect on the price because there is no act of selling. However, moving a BTC, especially from a long-term address, is a little concerning because most of the time they probably sell it. If anyone sees it, it may create panic selling. And perhaps this is why holders will not relocate their BTC if it is not absolutely essential. I simply do not believe that this will result in a bear market because there is always support and resistance that can be respected, and those areas have a large number of sellers or buyers. So just because someone is transferring their BTC doesn't indicate they want to sell; sometimes they just want to manipulate the market to make the price goes to their desired direction.

This relation might be a little stretch since there's no direct correlation to bear market movements and the existence/increase in use of cold wallets.

You might be seeing the effects of crashes happening within exchanges which drives the public to resort to self-custodial wallets, and the apparent recovery overtime, and then think that it's the switch from cold wallets that's causing this recovery when it's all just normal market behavior in the first place. It's great and all to think that and perhaps even promote the use of cold-wallet since it instills responsible investing and all that nice shit but at the same time, you're painting the wrong picture especially to newbies who aren't that aware of how bitcoin works just yet. This may make them think that just holding their bitcoins on cold-wallets will shoot its price up when that couldn't be any farther from the truth.

Bear markets happen when supply expands (holders put their coins for sale) or demand collapses (people with $$ don't put buy orders). It is actually a combination of both factors in different proportions.

Holders moving coins to cold wallets is not changing the supply, because they can send the coins back to an exchange quickly. Even if they will vow to only use DEX, it's still a connected global market and price will change quickly.

If @OP is thinking that people who use non-custodial market will forbid these users from selling their Bitcoin, @OP think again.  Selling one's holding is dependent on the holder, whether they are holding their Bitcoin in an exchange or it was secretly kept in the most secure place, if the holder wanted to sell his Bitcoin, he will retrieve and sell its holdings.

So I honestly don't think that how people keep their BTC will have an effect on the market.

I think so, if a good number of users hold their private keys they'll be lesser drastic fall of bitcoin price. Yet a lot of task is required here. These exchanges get hacked despite holding the keys that contains the funds of all who patronize the exchange. Self custody doesn't mean that a wallet can't be hacked, if the private key is carelessly stored. Hackers have multiple ways of accessing people's devices. Some users have their private keys stored on computers, written on different papers and not sure of the key's exact location. Thereby increasing the chances of getting hacked. If 90% of bitcoin users go self custody the loss of private keys and giving private keys to hackers by storing keys on sites and emails will definitely affect the loss of funds. Everyone can be thought about the risk of saving bitcoin on exchanges and they'll move to self custody, but they can't be schooled to always stay careful with their keys. Additionally, not every bitcoin user spend time reading about bitcoin.

Maybe he do mean that if there would be less coins that would be traded up then there would be no such huge movements like declines but come to think that coin circulation is something that would be relevant.
Even we do know that storing up our coins on wallets which we do have full control doesnt mean that we cant sent out back and forth with those coins to be used on trading. Therefore, this is a condition or situation
which i dont see any sense at all on trying out to avoid bear markets just to have that switch up with those coin possessions into their hardware wallet or getting it out on market circulaiton.
Bare in mind that bear markets or bull ones cant really be stopped on which there would really be cycles that would really be happening no matter what and this had been caused by several factors.
As an individual who do have that kind of fear on putting up their coins on centralized places or simply they dont possess the keys then they would really be that paranoid when it comes to security
which its normal to have that approach on making use of those wallets but this is actually dont have any connection in between market conditions like bear market phase.

Of a truth humans will always be humans, all fears has subsided after all we still need to trade and the mucd conducive platforms for trading our cryptocurrenciea are the centralized exchanges that's why we won't stop seeing more and more bitcoin or cryptos left in Cex because many will see it as burdensome and stressful to now and then be transferring their funds to their selfcustody wallet after each trade is done with.  However, outside the corridor that it's a risk leaving our assets in Cex it has nothing to do with the price of bitcoin bull or bear. The factors that influences bitcoin market price are purely not a custodial factor.

Are you saying we should attribute the bitcoin market stability and price to the activities and success of the exchanges? I don't think they have the tenacity to hold onto any vital aspect of bitcoin market value determination because bitcoin itself depends on it market supply and demand within it's network, if more than five exchanges should closedown today, it makes no difference from what we expect to see with bitcoin market value in the nearest future, except some more factors affected it's market demand and supply rate which may cause the market price to change.

People will always be people. After they are moving to noncustodial wallet after FTX collapse, the exchange inflow later increased back to normal later after some months.

If you look at the 24 hours trading volume on every crypto exchange, you will see how people are trading cryptocurrencies and noticed that there is nothing yet change, it is still just like it was before.

I think that a lot of market makers are using extreme forms of leverage to manipulate markets and get funds from their customers. Trading helps give them profits to leverage and depositing coins gives them fuel for manipulation. Eventually the thought is enough people will self custody causing market manipulators to crash like FTX as they run out of customer funds to play with.

I don't know if there is a direct relationship between bitcoin self custody and bear markets. If majority of folks don't keep their bitcoin is self custodial wallets, that could mean they are keeping more on CEXs and this can lead to more trading.

However, the supply of bitcoin available on CEXs for trading doesn't denote a bear or bull market. Many more factors are involved.

Something must lead to a bear market, If it is not the CEX, it will be something else.

Bear Markets results from factors that we cannot control, so no matter how many people in cryptocurrency practice self custody, there will always be a bear market for some other reasons.

It will not be pragmatic to expect a bull market and no occurrence of an event that will really affect the price of bitcoins negatively.

I am not getting exactly what's the relationship between the bear market and moving funds into a custodial wallet. We should always practice non-custodial wallets to secure our funds either a bear or bull market. Storing funds into centralized exchanges became highly risky after the FTX collapse. That means any CEX would collapse anytime and claim bankruptcy. That situation creates a bear market actually. However, we shouldn't trust any CEX right now, and secure our funds with a non-custodial wallet unless you need to trade.

Is no loner news that Bitcoin movement to cold wallet have been on the increase since 2022 when the Bitcoin market faced one of its most drained bear market, and the reason for such value decrease is not far-fetched as it is attributed to the collapse of several centralized platforms, ranging from the exchange and another investment platform such as Genesis and FTX crisis.


Knowing this reality that Bitcoin on its own can not easily slide into such a bear market, and all the Bitcoin bear markets have been influenced by the activities of those centralized exchanges and their shortcomings, their inability has been the cause of all the crisis rocking Bitcoin and the general cryptocurrency market stabilities.


Bitcoin holders are beginning to drive joy in the self-custody of their coins, and this has been reflected in the increase in Bitcoin movement from exchange to custodial wallets where the holder has 100% control.


And for me, this action is going to bring about long-term stability and a minimal occurrence of a bear market most especially a market crash-like bear condition, because if a large number of Bitcoin holders move their Bitcoin into the cold wallet, it will reduce the over depends and trust issues that have to accompany exchange usage/ centralized non-custodial.