The Biggest Lie Bitcoin Investors Are Told In 2026 ( Not What You Think) | Matej Zak - The Wolf Of All Streets | Podcast on Spotify

What if the biggest risk to your Bitcoin isn't the price, but where you're holding it? Everyone's buying ETFs. Everyone's leaving coins on exchanges. And almost no one is asking the real question that we used to always ask. Who actually controls your keys? In this interview, I talked to Treasure CEO Mate Zach and we break down self-custody exchange hacks. >> The biggest hack in the whole industry happened last year on an exchange, right? Like the buy bit hack. You think about self custody being like completely decentralized obviously because you have the individual owners. You don't know where they are. You don't know who they are. You don't know their setups etc. So those attacks are at scale are basically impossible. >> AI powered scams, quantum threats. >> So if quantum comes, the whole world has a problem. Your bank accounts, your credit card, like the security of the of the digital space would be kind of at risk. Besides quantum, I'm worried about AI and the beat of these attacks that can happen scares me. >> And why hardware wallets may be more important now than ever before. >> And honestly, I think hardware will play a role in this as well where you can really rely on a device that is like purely built for it creates the wallet and it signs a transaction. That's it. Like it doesn't do anything else and that's the beauty of it. If you own Bitcoin or crypto or plan to, this conversation could change how you protect it and how you view it moving forward. Let's get into it. Let's do >> So, Matte, when did you get into Bitcoin? Um I think seriously only when I joined the company which is well seven years ago. So I I owned some before. Uh but then I applied for you know for a job with Chester really as a product manager and then that's where I think things started to get more like serious for me. >> So it was just a job for you at first. It wasn't that you'd been orange pill or you had a deep libertarian values or was that part of the reason that you took the job? I came in as a trader and didn't care at all about Bitcoin, by the way, and eventually found my way. I was not one of those early people either, >> you know. Interestingly, I I had those values. Obviously, I mean, person doesn't change that much, I think, like or or at least the these deep values didn't change for me, but I didn't know there was a name to it, you know. I didn't know there was like a whole thing. But then it it clicked so well like when, you know, like I joined the company. Uh I mean, it was tiny team. it was like 30 people and I had the amazing opportunity to work uh with the founders uh directly. Um right because it was a small company. Uh so so I think they introduced me to to basically they they properly orange me uh and that was kind of nice to have that experience from you know somebody who set up basically the whole self-custody uh hardware vault industry. So it was cool. So obviously self-custody has become more popular I would imagine as the industry has grown more people buying wallets but it seems like now there's a lot more competition with self-custody from either institutional custodians or exchanges that have admittedly improved security to some degree from the early days. I remember when you had no security on any exchange period. Um, so now it seems like we're at this interesting place where a lot of people who are coming into Bitcoin come in through ETFs or uh leave their coins on an exchange and use a UB key or something as the maximum security and maybe they don't even find their way to self custody. >> Yeah. So um you know just maybe a bit of a statistic but like the biggest hack in uh in the whole industry of the crypto industry happened last year. So on an exchange, right, like the buy bit hack. So So whether the security of the exchanges like improved significantly, well, it definitely did. Uh but it there are still some other problems such as these institutions are basically honeypotss for hackers, right? So so it's exactly what we saw with the bid hack where uh I think it was the North Korean hackers, the Lazarus group basically got onto this big exchange. Whereas if you think about self- custody being like completely decentralized obviously because you have the individual owners, you don't know where they are um you don't know who they are, you don't know their setups, etc. So, so those attacks are at scale are basically impossible, right? So, so that's what the hardware wallet does in general and that's why everybody should sort of uh consider consider it for for themselves as well. And then um you also mentioned the ETFs. So there it needs to be said that like this is something what is called like indirect exposure to bitcoin. So you don't actually own the bitcoin. You only own when you buy an ETF you sort of get an access to like a legal contract that says well yeah there's some company hopefully they uh they even have the bitcoin that they claim they have considered they are not heavily leveraged or anything like that. uh but you don't really get uh the actual ownership. Um now you know like as opposed to gold, Bitcoin solves this beautifully because it's a it's a digital product, right? Like it's a digital solution. You don't need to have uh like a 2 kilos of of of gold hidden somewhere in your place. So, so the fact that it's digital, the fact that you can own it uh yourself is is obviously beautiful and and where I stand, of course, I would recommend people to uh to consider the proper self custody, the proper ownership, which you know, they can start with software wallet. It's fine. There's it's the security is not there as as as robust as with like a dedicated hardware device, but um but it's definitely superior over the EPS or or any other solution like that. So, we agree with that, right? We've been here a long time. Self-custody is exceptionally important. It's partially the reason we're here, right? Uh, you know, don't trust verify, be your own bank, uh, not your keys, not your coins. We've been saying these things for years. How do, in your mind, you continue to deliver that message and spread it further as these other competitive products and custody solutions, custody solutions come into play? I'm a huge believer in uh free markets and I believe that um the superior products uh and superior experiences will win uh in terms of security, privacy but also usability. Right? So that's basically actually these three words are uh are the kind of the pillars of of our company specifically that's you know in our mission statement is is really privacy, security, usability and so I think we we need to compete and we are competing by introducing new products that are really super easy to use but also that have sort of proven that um that really are unhackable or that are really really secure and that also the company behind it such as us um really uh protects you know user privacy by not for example storing the priv private data uh on self-custody of a hardware wallet you don't have to do any KYC so us as a company we don't really know who the users are we sell the hardware but uh there are no customer accounts that will be connected to to whatever you own right whereas in ETF or or your exchange you always need to provide uh your ID you need to verify all those things which simply ins custody you don't have to do. Therefore, you have much more anonymity u and protection uh sort of by nature or as as a nature of of how the product is built. So, so yeah, that's probably uh what maybe what I would add to this topic. Yeah. >> Yeah. I think we've had a push across the world in some places to more KYC and more AML and less privacy. Obviously, even the Genius Act itself is basically the Bank Secrecy Act built into stable coins, right? There's full visibility into our transactions. China building a CBDC. It seems that things are trending towards less privacy. Do you have any fears as a company or do you come against any contentious legislators or regulators in certain jurisdictions that really might ban or attempt to limit the use of self-custody in general? I mean, it feels like it should be a basic freedom that you can buy Bitcoin and hold it yourself, but I've got to imagine that you have some navigating of governments to do when figuring out where and how you can sell your products and what your users can do with them. Yeah, we are ultimately a freedom technology company. So the main reason why we do do the those things and these things these products is to really provide user with the option to freely transact and for the governments and companies etc. not to mess with with what you should own and what you like truly own. Uh so uh do we see uh sort of the regulation getting a bit tougher around the industry in general? Yes, I think that's that's the case. Uh but we haven't seen any uh there's no strong regulation on the self of hardware world specifically yet though obviously there is a ton of regulation in the ecosystem. So if you want to buy um sell you know of course taxation is another story of that um in in that whole journey. So uh luckily there's no like strong regulation on on on self custody in its own in in a way that for example you would need to give IC or hardware wallet as I said this is not the case. So that's why it's also superior um way of of owning uh bitcoin and crypto. Uh but does it worry me for future? Uh yes it does. It's it's I think it's like a real threat to to the freedoms uh of the individual users and and that's why we are here you know we will try to build products that really um uh like I said like as as an example we don't really collect any data uh and that's a that's a feature it's not a bug uh it makes our job somewhat more difficult from product management point of view because you don't really know what to build uh exactly next because you don't really cannot rely on that ton of data. I study companies uh can but that's actually yeah it's the feature it's a feature of the whole whole ecosystem you >> said privacy security usability right those are the three pillars that we discussed so I think everybody's in consensus that privacy and security are superior with self-custody I think a lot of people in the past at least historically have struggled with the usability right we kind of go back to the idea of grandma being able to do anything in crypto Like that's the joke. Like can grandma do it? You know, like is the UX UI simple enough that she can do these tasks the same way she would with systems that she's familiar with in the past? How far has usability come? Are there major challenges that you see to getting to the point where it's literally can be used by anyone? Like do seed phrases need to go? I mean, Treasure, didn't you guys invent the seed phrase? >> Uh, yes, we did. We did. And I'd say actually maybe coming back to the history, I think that's what was the first or maybe one of the most significant uh usability improvements of the whole industry. Actually uh I dig up some numbers in the past and and if you think about it like the seed phrase is probably used by hundreds of millions of users. I I I think I looked up the number because if you if you look uh the seed phrase is not used only by the hardware wallet companies but also the software wallets, right? So, so the big software wallet houses and and those have >> Yeah. Yeah. Yeah. Yeah. Of course. Like, but also like when I checked the the sort of numbers of actual users, it's probably somewhere like 300 million or something like this, right? Like a crazy crazy amount. And these people are uses using C phrases that were invented by uh yeah by the founders of of Treasure. And that was one of the biggest I think historically impacts on the usability of private keys. Uh because private keys are, you know, I like to say I like to explain it as a super long Wi-Fi password where if you miss one character or make a mistake in one character, you get a different private key and there therefore you don't get access um you know to your assets on the blockchain. So, so that's where Seef first came in as a solution to okay, let's make this like super hard Wi-Fi password into something that's human readable. And now really hundreds of millions of people are using it, which is which is um uh pretty cool. Uh but but I mean that's been you know like uh many years ago. So I think there's much more that we are doing collectively as a as a whole industry. Uh we at the hardware level as well. So we launched some new products actually just last year that like our most premium and most advanced hardware wallet that is like sort of the testament to to the usability because it has a bigger display you know it has very like premium feel and to your question whether grandpa can use it and and anybody I really think these days yes I think the the argument is no longer there that crypto or hardware would would be too difficult um to use because It's simply like super intuitive, you know, if I mean if you can use smartphone, then you can use hard Google. Like that's it's that's simply as easy as that. >> And so is the seed phrase still the future? You know, we've obviously seen a lot of self-custody c companies and wallet manufacturers start to use either biometric ID or completely other systems or is the future, I guess, giving the user the option as to which one they they want to use. I mean how do you view that when you look 10 years down the road and say how are people going to want to use these things? >> Yeah, actually I like the second uh thing you said. I think people should have option. I think there should be also uh interoperability as a as an option to move before uh between different providers. So also the the cool thing about the bit Bitcoin improvement proposal 39 which is the seat phrase um it's cool because it's used by not you know not just us but like basically like I said our direct and indirect competitors and if for example you buy chor and you set it up uh you can toss the chor and you can move to directly to some other solution you would like and it's perfectly fine right so the interoperability part is like really important so so the user choice as mention I think is really uh important part of the story and therefore my yeah answer would be yes in 10 years I still believe seat phrase is uh good and will be probably around because mind you most of us are also hodlers right so so it's like a long-term product it's not like your iPhone that you would like flip it every every year or two it's like you you want to think like a long term uh because of a nature of bitcoin etc so so yeah I think seeds phrases will be around but uh I would also add but I also believe there are some new formats that are coming like NFC you know tags etc where you can basically digitally store uh these phrases and that's also has some uh advantages such as you know protection against fishing etc. So, so yeah, I think these these new formats uh are good are important. They have some benefits. Uh they also have some negatives because whenever you has something that is not purely uh uh let's say analog as a piece of paper uh you know it also uh brings some let's say um risk of you know the failing tech like the chip inside of the card could go wrong or whatever. So, so yeah, there are some pros and cons and therefore, yeah, I believe the user should have options to basically do both. >> It seems incredibly difficult to create a product and then go through the amount of time that it takes to see that product product come to fruition and still be ahead of all the threat actors. Like, there's got to be hackers out there that are just working on this 247 365 trying to find ways to do these. I want to get into quantum in a minute and whether that is uh worth discussing. But how do you create a product that is going to be viable and relevant by the time that product actually comes out and then for the foreseeable future from there where people will continue using it? Yeah, it is super relevant question for a hardware company. Uh because like uh there is this saying that the hardware is hard and it's very much true. uh uh because exactly you need to plan like ahead you know like in the software and especially AI like we see like how fast it is now these days like you can really without uh within minutes or hours maximum you know build software it's it's incredible right so so even the software development that like the agile software development you would think of shipping a feature you know in a couple weeks um now AI this speeding this up even even faster you know to maybe hours and hardware it's the complete opposite. It's like it's years of planning. It's like super waterfall meaning you know you just like uh build like a huge project together in a in a very sort of predictive way. Um and if something goes wrong at the beginning then the whole timeline gets postponed you know. say it's like kind of uh nerve-wracking uh to a certain uh degree and then therefore you need to like rely on really good partners you know like the suppliers etc. It's like really a really big sort of uh uh project. But I think big part um to what you're sort of asking is uh how how you stay like security wise on top of the game. Uh well there's this also saying that security is moving target. So I totally agree with when you say like there's hackers that there are once you re release something they are instantly trying to get in. um you know and that's perfectly fine because it is really a moving target and we need to stay sort of v vigilant and always check for when we can improve but a huge uh part of this story is the fact that we are open source and therefore what what this enables us to do is basically that thousands of you know security experts, engineers uh people that know how to break things um that they will try to break things that will try to break our software and hardware. And by sort of us knowing this, because we built in the open and we actually incentivize um you know uh these like sort of ethical hackers to tell us when there's vulnerabilities. We even have like a bounty program where we pay these people if they find some problem. Uh that basically help us to uh to stay on top of the game and to always be sort of more secure as we move on. Right. So, and it's a huge advantage over some of maybe our closed source um competitors or other companies that are in the space because uh because you really never know what's happening under the hood and it's actually like called security by obscurity almost like that by hiding away the the information you're basically introducing some risk because the bad guys maybe know about this uh but you as a company would would not allow to spread this information about the certain attacks and therefore we actually make the product sort of less less secure. So open source from this perspective is awesome and that's where we try to be uh very like sort of bullish on on open source and it's it's our DNA basically. >> So I want to talk about quantum because it seems to be one of the big narratives that's not only driving FUD about the future of Bitcoin in general but certainly that's been driving FUD about the price of Bitcoin. Right now you have kind of bigname media personalities, some who are Bitcoiners going online and saying this is over. Bitcoin is going to get hacked. Personally, I think I'm worried about them hacking the nuclear codes before the Bitcoin network. And I think it's a bit of an echo chamber uh a argument, but I would imagine that now one of the big things you have to be concerned about is being quantum proof in the future, at least from a self-custody perspective. Because whether quantum is a existential threat to Bitcoin or not, it could definitely be an a threat to a wallet, right? So, how do you I guess start to consider the evolution of quantum and quantum proofing your hardware in the future, >> you know, exactly as you said with the with the codes. Uh so, you know, if quantum comes, uh the whole world has a problem. Uh and you know like your bank accounts, your yeah credit card like you know like you you would basically the the security of the of the digital space would be kind of at risk. Um your email like whatever on the online internet whatever digital like all these things would have have problem because you would have so much computing power to break through the current cryptography um that would just yeah the whole world would basically collapse. But that being said, well, there is also postquantum cryptography where you basically these um sort of security measures are much more harder to break even with with the computing power that that quantum would bring and and therefore the network I mean Bitcoin and other cryptocurrencies basically need to get an update. And whether I believe they will get an update in in time, well, I do. I I really do believe that they will because there is already so much money and so much market capitalization that there is so much interest in uh from all parties not just like individuals not just like engineers not just like retail not just companies not governments everybody basically everybody it's every in everybody's interest who is in the market to to get this fixed and or improved strengthened and I simply believe it will happen as it will with the rest of the world and with rest of the internet AI of course is a huge part of this as well. So um so yeah so actually as we said like security is a moving target. Uh quantum computing is just yet another one of these sort of uh possible um how to say like um challenges uh and and we will fix the security. I'm I'm I'm I'm pretty sure about this. Specifically in Chzer we with the new model that we released we we added some postquantum signatures uh in >> in uh in the device on some hardware level which basically means that if if these quantum threads would come in coming years again we are talking about the product that is like a very long-term you know like a hotel uh type of um customer life cycle let's put it this way uh and therefore in future if you own PS7 just treasure 7 or we could actually update this with some uh postquantum security measures. So it would not be uh you would not be able to uh extract any uh any secrets from the device even with the quantum computer. >> Yeah, the treasure 7 save 7 is really cool. Uh maybe I guess talk about the evolution of that device specifically and what I mean obviously you just talked about it being effectively quantum proof or quantum proof signatures down the road. What other huge leaps would you say that this wallet has made from previous uh iterations that you had before? >> So the probably the biggest one is uh that we added uh as open source as possible. I would say we got auditable secure element uh which secure elements are you know secure chips that are on your hardware ballet and they protect the device from any kind of physical attack. So even if some bad guys would get a hold of the device and they would try to extract the private keys uh from the device, these secure elements are are sort of specialized chips that you know make it really hard for anybody to extract anything from um any data from from the device. Uh and historically these uh secure elements they uh they are closed source. So the way it works is basically you reach out to this P manufacturer and you say okay give us the documentation we want to check uh on our own whether the sec the security of the chip is good or not and they will tell you well we are not going to send you the documentation unless you sign an NDA uh for like many years and and by the way if you find some problem with this chip you cannot tell anybody you cannot tell uh your competitors you cannot tell uh anybody and but that's basically what happened to us So for many years in the past we didn't have secure elements in our hardware wallets and our our direct competitors were using them and we realized um because we site the NDA just we just want to try like whether maybe one of those securements would be viable for us and we realized there's some sort of like a bug and we can extract uh the the secrets from it that were used again by the direct competitors but we couldn't tell anybody because we signed the NDA already and the company told us well if you tell them or if you tell anybody you will sue, right? And and this is like a huge company uh that like you know gives chips to or sell chips to like one of the like to the huge companies of the world like Microsoft and you can think of companies like this. So so we were like well this kind of shitty right so what what are we going to do about it and then the idea um came basically to try to build a open source secure element like in a very innovative way. So that's what what what happened and uh and it's it's part of the treasure stage 7 so it's kind of cool. It actually features two secure elements. Um one is sort of NDA free so we didn't have to sign in NDA with this one. Um but still it's not open source and the secure element from Tropic Square the company that built this is actually a auditable uh secure element and you can check uh you know the GitHub uh basically through the code and the way the chip is designed on on GitHub which is kind of is pretty cool for the security. Would you say at this point that people like the the tech is a bigger threat or that the network or the tech are a bigger threat to somebody's custody or do you think that their own human behavior is a bigger threat to self- custody at this point? Right. We we've had this debate by the by the way all the time and we had I remember I think CZ in the past got a lot of heat for saying hey you know people are going to lose their keys. They're going to make a mistake. They're going to fall on their head. You're better off having your coins on Binance than on a wallet, right? A hardware wallet. >> Yeah. So, obviously, I didn't like the the way he put it. I remember that tweet >> a while ago now, but I remember it. >> Yeah. Yeah. It's been a while. It might be like a two years, but yeah, I do I do remember this. Um I mean, of course, it's like a bit of a thought creation from his side to basically say, "Yeah, come to uh come to our big uh big centralized uh exchange." But like I said like you know like a 15 years old industry and then still the biggest hag happened last year right so so I I don't think the the exchanges are off the hook uh like security wise at all um but yes people are still to certain degree threat to themsel I think you really need to uh understand what you are doing uh and but the product will lead you right like you don't have to worry about that you would need like a PhD in engineering and to be able to manage you know Bitcoin and and hard robot. Not at all. The product is really like super intuitive. So as long as you care for some basic principles that are like um you know such as that you would not uh make a digital copy of your seed phrase. As long as you stick to the the the principles that the product will tell you to to obey uh then then you're fine. you're completely safe. So, so yes and and of course then there is still what what obviously I don't like there's ton of fishing as we know. So, so yeah, that kind of sucks that um people are threats to people as well by basically scary behavior. >> Yeah. >> Yeah. I mean very smart and sophisticated people that I know personally have been fished not necessarily on hardware wallets actually. I mean, I I see that going around, but more on the exchanges, you know, like uh you know, a fake email from the security at the exchange and a very plausible phone number when you call and here, send us your keys so we can you know, add a security layer. I mean, that stuff seems unstoppable. >> Yeah. Yeah. Absolutely. And I recently heard again like AI also plays like it's a sort of an accelerating uh like a factor here. Just recently actually some some somebody I know personally uh got fished by uh I think it was like a zoom call where they actually talked with somebody who who who they thought was like a real person. it was just like an AI and they they prompted them like to download some malicious uh malware on their computer and blah blah blah. So yeah, it's pretty it's it gets very very sophisticated and yeah, you need to stay stay vigilant. >> Yeah, that's the new big one is the actual Zoom call that looks like you're talking to a person and I've known some very early Bitcoiners. My friend Adon Yago who's like a very early Bitcoiner, he almost got scammed by one of those. He signed on and then he thought it was fishy and signed off. But it was not only a Zoom call was like with a Zoom call with somebody he knows >> who is a fake version of the person he knows that had contacted him from a telegram, you know, like >> and it's every layer, right? It's the layer of contact where they get you seems real from a familiar person all the way up to the Zoom call. People have to be so incredibly careful. So, I guess that said, it's probably a good time to sort of refresh people's memory on those principles that the wallet might walk you through. I don't want to take for granted that every person who listens to this has tried self-custody or even remembers what it was like when they did it 10 years ago or whether that has changed. So, you know, where do you write down your seed phrase? Where do you store your seed phrase? Should you have multiple copies that are geographically dispersed? Where do you put your wallet after you do all of this? Because like if someone walks in your house and you're standing there next to your wallet, it's sitting on your desk, you might be in trouble. So like maybe just give us like the beginner's guide to the basic practices of security with a with a hardware wallet. >> Yeah, of course. So the number one uh buy the device from uh like a verified site, right? So So for example, in the trees, we always tell you ideally go to treasure.io, which is our official domain. Don't buy it anywhere else. Go there. Like we ship globally. Wherever you are in the world, we will ship to you. It's not not a problem. So >> just buy you might be buying a hacked device or something, right? Somebody already had their hands on the advice device, did something to it and Okay. Yeah. Just >> Exactly. Uh you can also use some uh actually like a trusted uh network of resellers that we have. You will find it on our website as well. Treasure.io is the place to go. Then if you want to buy locally from from some reseller uh it's it's okay you know even like big big brands like Amazon etc store store Best Buy so you can go there as well but like always check whether those are actually supported by us whether they are official resellers because there were cases in the past where there were some like fake resellers that will try to scam you. So that's number one. Uh number two, when you receive the device, uh the packaging is built in a way and created uh in a way that it will really make sure that um the device has not been messed with like that's it's not as some kind of counterfeit. So like check that the the packaging is unbroken. There is some seals on the devices as well that kind of will guide you in a way like it's like yeah nobody could really mess with this device and and yeah so that's basically the hardware let's say uh security measures and then once you plug it in into your computer or phone uh and you start uh creating the onboarding then the device checks for some authenticity it checks whether uh it's never been used before. uh you need to confirm those things on on your display and the whole onboarding process will basically guide you through um through through it the way that like it's it makes sure it's it's secure for you. So just follow the screen and it will yeah it will check for the device authenticity etc. And then you download the firmware and then that's where the whole journey starts. It will prompt you to create a backup. uh as we discussed before you can write the backup on on piece of paper um which has some you know analog qualities to it as I said it's not digital so never take a photo of it never store digitally don't write it to your computer don't write it to your phone because whenever it's digital and somewhere on your hardware let's say like a device it can get hacked by because it it's connected to to the internet so that's what you don't want so you actually want to keep it completely offline and uh and yeah and there are also we also sell solutions such as treasure keep metal which is not which is not paper it's actually piece of metal well as the name suggests and you can actually um sort of punch the the seed phrase into this metal solution which is like really indestructible like even if you burn it in like thousand degrees Celsius or whatever it will not melt down and etc. So, so we we have even these like robust solutions. Um and and then yeah, hide the hide the backup away. Um don't show it to anybody. Um and and yeah, that's where your journey starts and you're you're safe there. Uh as for the device, yes, I would not uh I I think it's not good to boast about like how much Bitcoin you have or something. That's something you would you should not do online obviously. So, so soft custody is like um uh a privacy game. So, so yeah, don't do those things and then then you're completely safe. >> Didn't wasn't there a time when competitors were marketing like a necklace with your hardware wallet on it or something? >> Yes. I mean and and uh to this day we we make jokes about the central to be honest like and sometimes in like presentations and we would we would joke about this uh because obviously we don't we didn't think this was a good idea. Uh I understand like they probably wanted to like lure some new audiences uh new sort of target uh personas that would be into this but yeah I don't think it's a good idea. >> Yeah. I guess how much does that factor into security if you're a person who owns Bitcoin still? It's become so mainstream obviously to own Bitcoin, but there's still a lot of people out there targeting Bitcoin holders. I know specifically in France, obviously, we've seen this massive increase in threats and kidnappings, cutting people's fingers off and sending them to their loved ones. I mean, really crazy stuff from movies. And it seems there's actually been an uptick in that rather than a reduction. So really crazy stuff. >> Yeah, I think people need to be really careful. That's again that's the reason why not to go public about these things like that you would be boasting about like how much Bitcoin you have or something like this. That's yeah something that should not be recommended. Uh of course like these stories from specifically from France are very sad. Um I also read that in general like the the France sort of um the kidnapping rate or what you would call it in English is is quite high in general as a as a country. So it's not just specific to to crypto but uh but obviously uh the people in crypto are more sensitive to hearing that was cryptoreated obviously. So, so yeah. So, yeah, just please stick to your sort of privacy measures and that's that's all I can sort of recommend. And yeah, and it's sad. It's regrettable. Of course, it's it's it sucks. >> Should people have multiple hardware wallets or is it effectively safe to put everything on one? I mean, how do you kind of think about people with significant amount of assets and how they should, you know, disperse their assets to some degree? >> Yeah. Yeah. I think it's a it's a fair uh sort of choice for somebody to consider maybe like diversifying the the risk that they would even like Well, it's important to say that like if you lose the hardware wallet, it's still fine as long as you have the backup. And by the way, the back up again like the BIP 39 which is the seed phrase based on the the the protocol or the standard is you can actually recover your wallet even not just with treasure but with our competi our competit direct competitors which which is quite cool with this. So we can actually even lose the harbor vault as long as your backup is is safe and is as long as you know where it is. But yeah, you can definitely disperse this risk. Um but interestingly enough I cannot really give like a very like a like a hypersp specific solution because that would basically already lead um maybe or indicate where where the attackers could look you know like if now like if I told you okay uh put the hardware wallet underneath your pillow that would actually not work as a security measure because everybody would do it >> question more is like should that be something that's in your house or a safety deposit box or somewhere completely random that nobody would even even think like should it be you know a lot of people use multis sig and they geographically disperse them. I mean, there's all these different ways that you can do it, but it seems like if someone comes in your house and you're there, then you might actually want your wallet somewhere else besides your house that's secure so that you can literally just say, "I can't do it." Right. >> Yeah. Yeah. I think it's actually one of the ways how to how to approach this as well. Uh and it also depends on the usage whether you because then you also need the the device to sign transactions and interact with you know so it if it's like a for you the use case is maybe like super long uh long term and just a huddle and you don't have to touch it then exactly it doesn't even have to be in your place but if you want to interact with it more more more often then you can have uh the device close to you but then also you can uh really diversify by having maybe smaller amounts on you even like you can carry around the the device all the time actually because 7 now is uh you know it has Bluetooth you can connect it to your iPhone or or or Android so you can actually carry it around in your pocket but then uh you don't maybe need to have all the savings that you that you own on there right like so so you can diversify really depending on your specific use case >> yeah it seems like the mental model is that you have one that's your savings account that's very hard to access even for you to make it secure. And then you have one that's kind of like your checking account or your credit card that you can walk around with and actually use and you know trade with a small amount or whatever activities you're gonna actually use crypto for. I think that's always been sort of a push and pull of self-custody is that as we go more mainstream and people actually want to use these things which we want them to be able to do like use crypto every day well there's a challenge to being secure and using it all the time. >> Yeah. Of course. Exactly. Exactly. Uh but I can tell that from like treasure perspective, even if you have it on your own uh on on you sort of more often, it's still very very secure because there's multiple layers or how how you would need to break into the device and there's a pin uh you can use passphrase which is not even recorded anywhere. So, so nobody can really get get there unless like uh if if if you are the only person that knows this. Um then of course you know um the backup itself can be stored in multiple places because we also support something called multi share. So you can actually split the backup into multiple multiple shares. Let's say five and only three of any of those shares will actually be able to recover the the wallet. So as you said if it's like dispersed in in space and locations uh then it it's like really hard to get >> right I wasn't aware of that that's effectively like having multisig with one device >> true it is uh it is not multisync in in its nature because it this doesn't happen >> the three of five like the idea of >> the idea is very similar yes yes the idea is that basically you make this split on the backup level right so you basically can disperse sort of the wallet into into five uh shares. I think good example is like I don't know how much you're familiar with the with the Harry Potter story like it's something how we explain it you know where the the Voldemort he has like these I don't know what was it called in English but like these uh part of his souls basically and and that's exactly similar concept where you have these parts of the wallets and and only certain number of of them can actually re recreate uh the wallet for you. Yeah, I want to talk about the safe seven specifically a bit or at least the thesis when you're building it. Do you make a new project thinking about the next billion people that are inevitably coming into crypto or do you really think about the very security conscious people who already believe in self-custody or are likely to believe in self-custody and focus in on those and can that be the same thing? That's a good question because it's something that we obviously is quite important for us as a company to tackle and we've have we've been having these discussions for for forever but I think what we are seeing now is that we we are moving more from the like absolutely for everybody billion people use case uh or target audience into more yeah let's target a some specific groups of people more more targeted personas uh because well first like practical reasons uh you mentioned the ETFs there's exchanges you know you can it's actually you can just go to app store uh click a button uh download some whatever exchange and you can start you can you know create the wallet or or the software wallet you can download the software wallet and and start very easily which is perfectly fine like I would not even as a user I would say it's not there's no problem with this as long as you understand that you should probably not store uh much value in these wallets because they are simply not secure enough. So, so because there is so much competition from from this side to this sort of substitute offers that are cheaper, more accessible um more scalable to certain way. Um we need to compete um obviously we are security company so we compete on the on the premise that we are more secure that than any of these solutions. Um but we will never be as competitive in terms of we cannot be we cannot be for free right like because some of these software by basically the they're free and and they their the business model is based on maybe some some fees some if you make some swaps and staking whatever. So uh we're going to do that because the hardware is not cheap like it's not for free right so so uh and and because it's secure we really need the hardware uh part of it with actual display because there are also competitors that are that they call themselves hardware world but they don't even have display which is very problematic because again the blind signing uh was part of the the story of last year where the biggest hack uh on Dubai would happen so >> so you need the hardware wallet you need the display and we are now targeting maybe not everybody but more people that are actually with specifically with treasure state 7 we targeted sort of the more I would say advanced users in a way that like they already know the space they know what they are doing a little bit more they interact with uh with all kind of blockchains more often as well so more like a more frequent use case so so yeah that's how we how we think about it these days >> so I think a lot of it's it's sort of along the lines of the same question. So, you're obviously get a lot of new users, but when you come out with a new product, you also want to have your existing users or users of other wallets upgrade to yours, right? So, like if somebody has a treasure from 10 years ago, seven years ago, eight years ago, I I don't know, you know, as what's the pitch for them to upgrade to the new one? And I guess what risk are they reducing that they probably don't even realize that they had you know like uh what if I'm sitting on a wallet and I'm lazy and you know listen I've been through with every wallet personally >> terrifying firmware updates where I thought things were gone or like a light heart attack when I'm sitting at dinner if I remember where my seed phrases are even though I know they should be there right I mean we've all had these >> human moments >> um you know so I guess like what benefit are you getting by upgrading what risk are you reducing and why should you get the new one? >> Specifically, treasure safe 7 is a great example. It is really the most secure hardware ballot that we have built. It has two secure elements. Those specialized chips that I mentioned uh for example model one uh like the first ever hardware wall that we have ever built well the first ever hardware wallet in the world uh didn't have secure elements. you can still protect it uh cryptographically by using uh passphrase as a concept of you know the additional word that only you remember and that cannot be recovered from from anywhere. So that's still safe if you know how to use it. Um but like objectively treasor 7 is the is the is the most secure way from the from the hardware perspective. So that's one. Uh number two, the usability. As I mentioned, it's simply, you know, trees model one is like this big. Uh it has two buttons. Uh tiny display that is like black and white. >> Exactly. >> Maybe I didn't have the first one, but I definitely was. You know, the two little buttons, one, two, three, four, five. Yeah, it's brutal. >> Yeah. So, that was the first one. That's actually the first one. And and so, you know, the usability is definitely, you know, like a um like the the experience is worse. That's simply the reality. Um then uh Treasur 7 is like it's like really beautiful consumer electronics you know piece of hardware. It's it's really it's like a nice very very very nice device. So I think most people appreciate that as well. I mean uh look at the success of iPhones because I mean they are very usable. They they were beautiful piece of hardware always. So so it's the same same case here. Um so I think those are the reasons to upgrade. um additionally ecosystem. So so some of the older models don't support all the networks or all the functionalities you know such staking etc. So so yeah those are another reasons where the new newer hardware bots will will support more use cases for you as well. >> Are there any threats that keep you up at night that the rest of us haven't even thought of yet? Everybody seems on to quantum now. like is there something out there that's a big secret in the industry that we're all missing? >> I don't think I I don't think it's a secret, but I besides quantum, I'm worried about AI and the the I think sophistication of the fishing attacks, I think it's quite crazy. I think exactly the Zoom calls that we mentioned are crazy. the KYC being part of these companies, you know, like having tons of your data, uh, you know, when you combine like this sort of shitty soup, pardon my language, uh, it's fine, >> of like, you know, like a scale, uh, sophistication of AI, the speed of these attacks that can happen. Um, so that that I think scares me, you know, and honestly I think hardware will play a role in this as well as a like a user verification and where you can really rely on a device that is like purely built for a very few use cases like like it just like >> it creates the wallet and it signs a transaction. That's it. Like it doesn't do anything else and that's the beauty of it. >> I've been thinking about this a lot I think and what you just said aligns with it. I think we're actually very ironically going back to a world of hardware again and of inperson and all these things. Like I think you're gonna have to have meetings with people in person to know that they're human. And I think that people are going to be very skeptical of the cloud or anything that's not contained in a system that they can look at. We see obviously with Open Claw, everybody's buying the Mac Mini and they're putting up a firewall and now running AI instead of in the cloud on an LLM in their, you know, actual device in a secure place. And now you see these pictures of basically server farms of like Mac minis running AI, but they're secure hardware setups that the world has completely abandoned until now again. So maybe like the hardware device actually becomes the secure like intermediary for other transactions as well. It just seems like we're going back to a hardwarebased future just to make sure that things are real. >> Yep. Exactly. It's exactly it reads my mind and uh you know maybe even even in my personal uh sort of life I mean I used to be like my background like way before I started in tech like I was a musician I studied music actually uh >> and now these days I'm thinking um you know like like people are now scared like the in the in the art world in general like you know you know now you can create music online also like through through AI that is just like getting really incredible quality, you know, like it's it's uh but I'm kind of believer in that it will only strengthen also the pure human connection where people will actually want to go to gigs, they will want to see live shows, they will want to do all those things which you know it's like some pros and cons of course like uh yeah maybe as I don't know Spotify or whoever whoever killed the recorded uh music industry many years ago it will probably happens Similarly with AI as well that like these um um sort of creators will will be heard by this but then I also believe the the live shows will get away much more. So so exactly as you say people want to meet will want to probably meet in person more and um and on the tech side yeah hardware probably will will have a big story to play here. >> My background is music as well. I grew up playing music. I went and got a Ivy League degree and then chose to be a DJ after that. Uh after playing competitive classical piano as a kid and stuff and >> funny when DJing became less analog I got pissed off and was like the technology good I don't want to do this anymore. I was like one of those guys you know so it's that resonates very well with kind of kind of my thoughts. I know we only got a couple minutes here. I guess from a very big big p picture like your company and you as the CEO you obviously have a major responsibility to the crypto ecosystem to secure their assets but when we look at the AI future and these things all these things we've discussed how much responsibility do you think you have for the future of financial sovereignty and human sovereignty and all of these things because it seems like that's becoming more important than Absolutely. I think the the the responsibility is huge here. Uh not just for me personally but also for like the whole company. Uh like I mentioned before we we are we like to say we are freedom technology company. That's the main reason why we do it quite frankly. It's not that we would be obsessed with uh you know just the crypto on its own. I think we we do it mainly because we give some power and rights to the individual as they should have them right. So when we launched safe 7 uh we built this big event in Prague and invited you know guests from all over the world and I kind of asked myself question because as a co I had to introduce the product right like on on this keynote and I ask myself the question like okay so what am I even going to tell these people and then I'm thinking well they might be wondering how come that like the first hardware world company ever is actually from Prague. And why is this why why are there so many Bitcoin companies in Prague in like a tiny country 10 million people you know in the middle of Europe and and honestly I think it's based on the history because long story short I don't have to maybe tell you the whole story we might not have time for this but like basically in 50s uh there was some communism and there was some called like so-called monetary reform and people lost all their savings uh because the the government basically came and that well what was valued now like uh like 100 bucks now you only own you know like a five bucks or two bucks it was this this drastic like people really lost more than 90% of their savings just because of this sort of um uh devaluation of money and and honestly it's like just a few generations like my in my family uh yeah my grandparents still remember these times and I think we like build so much like distrust with the with the establishment and with like yeah with the with the governments etc. So, so I think that's why there are this many like freedom tech companies in Czech Republic in general and and now looking in the world you would think okay so well those things maybe happened in the past and they are not going to repeat but the reality is like it's happening right it's happening in like the the the Ukrainian Russian war it's happening even in Europe for the last four or five years so so yeah it's it's all over the world like we we can I think all feel it right so what's happening in Latin America like Yeah. Um, Middle East like all around the world. Basically, we have issues like this and and therefore the self- custody really is important part of this and and we will fight by giving great products and creating great products. That's the that's the way we we want to address these issues in the world globally. >> I know we're at the end of time here, but is there anything I missed? Anything you want to make sure that uh my audience hears about? Um if you haven't tried uh self- custody uh please do that. Uh you can start with software wallets. Just make sure that you understand they are not secure and that they get hacked all the time. You can you don't you don't have to trust me. You can you can verify it yourself. You can go on uh your favorite chatbot or or Google and and just search this information and then once you're ready, yeah, try try hard. It doesn't even have to be us. uh though of course I'm biased here. I believe treasure is great but like uh there are other competitors that are doing a fantastic job as well. So so yeah please get into hardware bots. >> Thank you so much. That was really a enlightening conversation and I don't think we talk about security enough anymore. I think it's one of those things that people were so passionate about in the early days and now we just talk about like what Donald Trump is doing or whether we're going to get legislation. >> True. I guess there's >> Yeah, I think it's important to go back to first principles. So, I really appreciate you doing that with me. >> Absolutely. Thanks for having me, Scott. I really appreciate it. >> Thanks so much. That's dope.