Not your keys, not your coins

When crypto is left on an exchange or a custodial app, the platform holds the private keys, and the user has a claim on the platform rather than direct control of the coins. If the platform is hacked, freezes withdrawals or goes bankrupt, the user may lose access. Holding the keys in a self-custody wallet removes that counterparty risk. The phrase, often shortened to NYKNYC, has circulated among bitcoiners for years.

It gained urgency with each exchange failure, from Mt. Gox in 2014 to the collapses of Celsius and FTX in 2022, after which large amounts of bitcoin were withdrawn from exchanges to private wallets. Some bitcoiners even mark the 3rd of January, the anniversary of bitcoin's genesis block, as Proof of Keys day, encouraging holders to withdraw.

Self-custody brings its own responsibilities. Lost seed phrases, phishing, malware and physical theft cause losses too, and many users are safer with a regulated custodian than with poorly stored keys. The slogan describes a trade-off, not an absolute rule.