The 2023 WazirX hack drained $235 million from a multi-sig wallet. The attacker exploited a custody gap in the signing process, not a code vulnerability. That distinction matters.

• Over 80% of exchange hack losses in the past 18 months came from hot wallet compromise. Self custody with a hardware device eliminates that single point of failure.

• A hardware wallet stores private keys offline. Even if your computer has malware, the signing request must be physically confirmed. This is not about distrusting exchanges. It is about minimizing attack surface.

• Exchange insurance often covers only a fraction of deposits. For example, most major platforms insure less than 2% of total user funds. Self custody means you hold the full liability and the full control.

The tradeoff is simple: convenience versus ownership. A cold wallet requires one extra step per transaction. In return, no counterparty can freeze, lose, or mismanage your assets. The math is clear when you consider the frequency of exchange insolvencies versus the rarity of hardware wallet manufacturing defects. Own your keys, own your risk.

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