Trezor Exec: Bitcoin ETF Worst Outcome

Bitcoin exchange-traded funds (ETFs) have become one of the most influential developments in the cryptocurrency market. Since spot Bitcoin ETFs launched in the United States in 2024, billions of dollars have flowed into these investment products, helping drive mainstream adoption and boosting market liquidity.

However, not everyone in the crypto industry views this trend positively. According to a senior executive at Trezor, one of the world's most recognized hardware wallet manufacturers, the growing popularity of Bitcoin ETFs could create a long-term problem for the Bitcoin ecosystem.

Danny Sanders, Chief Commercial Officer at Trezor, recently argued that encouraging investors to rely on ETFs instead of directly holding Bitcoin may represent the "worst outcome" for the industry because it weakens one of Bitcoin's founding principles: self-custody.

Key Takeaways

• Trezor believes excessive reliance on Bitcoin ETFs could reduce self-custody adoption among Bitcoin holders.
• Only a small percentage of global crypto users currently store assets using hardware wallets.
• The company urges the industry to improve self-custody education and user experience rather than relying on custodians.

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Bitcoin ETFs Have Attracted Massive Investor Interest

Spot Bitcoin ETFs have become a major success story in traditional finance. These products allow investors to gain exposure to Bitcoin without managing private keys or cryptocurrency wallets.

The convenience of ETFs has attracted significant institutional and retail capital. Billions of dollars have entered Bitcoin ETF products since their launch, helping increase Bitcoin's visibility among mainstream investors.

For many newcomers, ETFs eliminate the complexity associated with purchasing, storing, and securing cryptocurrency. Investors can buy Bitcoin exposure through familiar brokerage accounts without interacting directly with blockchain technology.

While this accessibility has accelerated adoption, some crypto veterans worry that it shifts ownership away from individuals and toward large financial intermediaries.

READ ALSO: Standard Chartered Says Crypto Winter Is Over at Bitcoin’s $59,000 Floor

Why Trezor Sees Bitcoin ETFs as a Risk

Danny Sanders believes that Bitcoin's unique value proposition extends beyond price appreciation. In his view, Bitcoin was designed to empower individuals by giving them direct control over their assets.

When investors purchase Bitcoin through ETFs, they do not actually control the underlying private keys. Instead, custodians and fund managers hold Bitcoin on their behalf.

This creates a situation where investors gain exposure to Bitcoin's price but miss one of the technology's most important benefits: financial sovereignty.

According to Sanders, if the industry simply encourages everyone to hold Bitcoin through ETFs, it risks undermining a foundational principle that distinguishes Bitcoin from traditional financial assets.

The Importance of Self-Custody in Bitcoin

Self-custody refers to storing cryptocurrency in a wallet where the owner controls the private keys.

Unlike assets held by exchanges, banks, or ETF custodians, self-custodied Bitcoin gives users complete authority over their funds. No third party can freeze, restrict, or manage access to those assets.

Trezor has long promoted self-custody as a critical component of Bitcoin ownership. The company helped pioneer hardware wallet technology and introduced important innovations such as the BIP-39 mnemonic seed phrase standard.

Supporters of self-custody argue that direct ownership aligns with Bitcoin's decentralized philosophy and reduces reliance on centralized institutions.

Why Many Users Still Avoid Self-Custody

Despite its advantages, self-custody remains intimidating for many newcomers.

Users who lose their seed phrases or accidentally share private keys with scammers can permanently lose access to their funds. Unlike traditional banking systems, there is often no recovery mechanism available.

Sanders acknowledged these challenges but suggested that the barriers are often psychological rather than technical. Once users learn the process, managing self-custody can become significantly easier than they initially expect.

The challenge for the industry is to create simpler, more intuitive tools that make secure Bitcoin ownership accessible to a broader audience.

Hardware Wallet Adoption Remains Relatively Small

According to Sanders, the global crypto industry now serves roughly 600 million users. Yet only around 10% of those users self-custody their digital assets.

Even more notably, only an estimated 12 million to 13 million people worldwide use hardware wallets, which are widely considered among the safest methods for protecting private keys.

These figures suggest that while cryptocurrency adoption has expanded dramatically, secure self-custody practices have not grown at the same pace.

Trezor believes this gap represents both a challenge and an opportunity for the industry to improve education, security tools, and user experiences.

The Future of Bitcoin Ownership

Rather than encouraging investors to choose convenience over control, Trezor advocates for making self-custody as simple as modern internet applications.

The company's long-term vision is to deliver a user experience that rivals traditional Web2 platforms while preserving Bitcoin's decentralized nature.

As Bitcoin continues to attract institutional capital through ETFs, the debate between convenience and ownership is likely to remain a central topic within the cryptocurrency industry.

While ETFs may continue driving adoption, companies like Trezor argue that true Bitcoin participation involves more than exposure to price movements—it involves direct ownership and control.

READ ALSO: Bitcoin Price Prediction for End of June 2026 as ETF Inflows Return

Conclusion

Bitcoin ETFs have opened the door for millions of investors to gain exposure to cryptocurrency through traditional financial markets. However, Trezor executive Danny Sanders believes that widespread dependence on ETFs could weaken one of Bitcoin's most important principles: self-custody.

According to Trezor, the industry should focus on making self-custody safer and easier rather than encouraging investors to rely entirely on custodians. As Bitcoin adoption continues to grow, the balance between convenience and ownership will remain a defining issue for the future of digital assets.

FAQ

Why does Trezor criticize Bitcoin ETFs?

Trezor believes Bitcoin ETFs reduce direct ownership because investors do not control the private keys associated with the Bitcoin held by ETF providers.

What is self-custody in Bitcoin?

Self-custody means personally controlling the private keys that provide access to Bitcoin rather than relying on a third-party custodian.

Are Bitcoin ETFs bad for Bitcoin?

Not necessarily. ETFs increase accessibility and adoption, but some industry participants argue they reduce the importance of direct ownership.

What is a hardware wallet?

A hardware wallet is a physical device designed to securely store cryptocurrency private keys offline.

Why is self-custody important?

Self-custody gives users complete control over their assets and aligns with Bitcoin's decentralized philosophy.

Disclaimer: The views expressed belong exclusively to the author and do not reflect the views of this platform. This platform and its affiliates disclaim any responsibility for the accuracy or suitability of the information provided. It is for informational purposes only and not intended as financial or investment advice.