I know, it's stupid. But many people think CEXs are better because they're regulated entities. A scandal like this from a hardware wallet company, scares away noobs. There's a lot of FUD regarding the self-custody industry. Things like "self-custody is dead", and "Bitcoin got hacked" damage the industry's reputation.

Will people trust hardware wallets again? That's an excellent question. Hopefully, this will pass as we unveil a new chapter in crypto security. Only time will tell.

It isn't the ideal solution but there is no solution that is meant for everyone. Many maximalists get these things wrong because they are behaving irrationally about this kind of topic. When we talk about custodial and non custodial solutions we already have to ask the question who is it for? There are many elderly people and there are even people in their 50s who can't even find out who they are following with their TikTok profile. This kind of person is not able to self custody and they should not even try! The chance that they will do something wrong directly or lose their money through some kind of hack or phishing scam is very very high. In comparison to that, using a very reliable and regulated CEX for them is extremely safe. Now this kind of setup is completely different for someone who is good with technology, for him or her the risks are the reverse. They have a higher chance of losing money through the CEX and they miss out on some of the core principles of Bitcoin that relate to self custody.

So while doing self custody is the best, it is not for everyone and we need to be careful who were recommend this stuff for. I think that most coldcard users of the wallet that was hacked are capable of doing most self custody solutions so they should not return to CEX use because of this incident.

Clearly it's not the ideal solution but it could be the quickest realization of these bitcoin holders. If self-custody isn't safe anymore, then they might end up risking their bitcoin to a centralized exchange again, most particularly those who are affected with the Coldcard exploit, or they might stop investing in bitcoin for a while until they are fully emotionally recovered.

However, we all know that the last incident was very hard and painful. But isn't the very reason of losing or frustration is to be more careful and cautious the next time you do it, so we should not get carried away with our emotions, shifting into CEX won't be the best solution after what happened to Coldcard.

There are really some incidents that could happen inevitably, but I don't think one huge loss will ruined everything the good reputation of having a hardware wallet. If you are one good investor, and you have witnessed the past lapses and threats of trusting a CEX, then I don't think you will definitely leave the self-custody thing and risk your assets into trusting a centralized exchange.

We all know that CEX are even more risky to put our coins there, so why take the risk and regret after? I still believe this is just temporary, people may learned the hard way but will still trust hardware wallet over CEX.