Introduction: Key Step to Safeguarding Wealth

Imagine holding millions of bitcoins, but due to a hack or negligence, your wealth disappears in an instant. This is not a fictional story, but a possible reality in the cryptocurrency world by 2025. Currently, the price of Bitcoin has reached $200,000, with the global cryptocurrency market exceeding $25 trillion, attracting the attention of institutions and high net worth individuals. However, along with wealth growth, security risks are also increasing. Cryptocurrency custody, a crucial step in protecting assets, has become an unavoidable choice.

Are you a newcomer to cryptocurrency or a high-net-worth individual with a large amount of assets but concerned about security? This article will uncover the secrets of custody for you, sort out the industry trends for 2025, and provide practical advice for protecting your wealth. Let’s take the first step together to safeguard our wealth.

Part 1: Custody, the Foundation of Wealth Security

What is custody? The choice of controlling the keys

Simply put, custody is about deciding who manages your digital assets. More specifically, it concerns the ownership of your ‘Private Key.’ The private key is the key to open the encrypted wallet, and losing it means losing everything. You can choose to entrust it to a professional institution, which is third-party custody. Or you can save it yourself, which is self-custody. Just like depositing money in a bank or keeping it at home, custody is a choice between security and convenience.

Why is hosting so important?

In 2025, the cryptocurrency market is booming. Institutional funds are pouring in, with the assets of high-net-worth users reaching tens of millions or even billions. However, the risks of hacker attacks and private key loss are also on the rise. Custody not only protects your assets from threats but also allows you to participate in the market with greater peace of mind. For novice institutions, custody is the starting point for entering the crypto world. For high-net-worth users, it is the cornerstone of wealth security.

Common Misconceptions

Some people think that custody means completely handing over assets to others, with no control over them. In fact, many services allow you to withdraw funds at any time. Some people think that managing private keys is the safest. However, if you don’t know how to properly store them, the risk is even greater. Custody is not black and white, but a solution that suits you.

Part Two: The New Landscape of Custody in 2025

Industry revolution, strong momentum

By 2025, cryptocurrency custody is no longer a niche area but an integral part of the financial industry. Traditional giants like BlackRock and Fidelity have launched enterprise-level custody services, driving the market towards maturity. The U.S. government’s ‘crypto-friendly’ policy allows banks to provide compliant custody. Advances in multi-signature technology and decentralized finance (DeFi) make custody more flexible and efficient.

Data Reveals Trends

Market research predicts that the cryptocurrency custody industry will grow from $46.4 billion in 2025 to $157.5 billion in 2034, with an annual growth rate of 14.53%. Bitcoin ETF remains hot, with fund inflows expected to reach a new high in 2025, leading to a surge in custody demand. Institutions and high-net-worth individuals are accelerating their layout in this area.

New Opportunity, New Field

The tokenization of real-world assets (RWA) becomes a highlight in 2025. Real estate, artworks, and private equity funds are transformed into digital tokens, and the scope of custodial applications expands rapidly. The daily trading volume of stablecoins is expected to reach $300 billion, with custodial services becoming the core support. This brings a safer market environment and more investment opportunities for retail institutions and high-net-worth users.

Part Three: Self-Hosting or Third Party? Your Choice

Self-custody: Steering by Yourself

Want full control of your assets? Self-custody allows you to manage your private keys personally. Hardware wallets, such as Ledger or Trezor, can store assets on offline devices. Software wallets, like MetaMask, are convenient for use anytime. The advantages are obvious, strong privacy, and control in your hands. But the risks are high too, if the private key is lost or leaked, no one can help you recover. Suitable for technically proficient institutions or high net worth individuals who value privacy.

Third-party custody: Professional guardianship

Not familiar with the technology or limited in time? Third-party custody is a good option. Service providers like Cactus Custody offer bank-level security protection, along with insurance support. Easy to operate, low risk of asset loss, very suitable for novice institutions and high-net-worth users. However, trust in the service provider is required, and if the platform encounters problems, assets may be affected. Suitable for users who need convenience and professional support.

2025 Choice Advice

How to decide? Look at three points. First, security. Strengthened regulation makes third-party custody more reliable. Second, cost. Hardware wallets require a one-time investment, while third parties may charge an annual fee. Third, demand. Short-term trading is suitable for third parties, while long-term holding tends to lean towards self-custody. Novice institutions can start with third parties, while high-net-worth users can combine both methods to ensure asset security.

Part Four: Practical Methods to Protect Wealth in 2025

Basic protection, must be mastered

Protecting wealth starts with basic steps. The private key must never be disclosed, and backups should be stored on a secure offline medium, such as an encrypted USB drive or paper records, placed in a secure location that is theft-proof and fire-proof. Accounts and wallets need to enable two-factor authentication to add an extra layer of protection. By 2025, phishing websites and fake emails may become more rampant, so be cautious when encountering suspicious links.

Advanced protection, improve security

Want to go further? A multi-signature wallet requires multiple private keys to agree before funds can be accessed, making it difficult for hackers. Cold storage isolates assets in an offline environment, making network attacks impossible. These methods are particularly suitable for high-net-worth users, providing a more secure way to protect large assets.

Dealing with New Risks

By 2025, AI-driven fraud may increase, making it difficult to guard against disguised emails and fake websites. Staying vigilant is key. The regulatory environment is also changing, and choosing custody services that comply with local laws can reduce policy risks. Security always comes first, with returns built on top of security.

Your Action List

1. Check the qualifications of the service provider to ensure insurance and compliance support.

2. Check and update your account password every three months to ensure the security of backups such as private keys or recovery phrases.

3. Test with a small amount of funds first, and then increase the investment after familiarizing yourself with the process.

Part Five: 2025, Mainstream Technologies and Trends in Custody

Technical Support, Strengthening Security

The strength of encrypted custody comes from technical support. Decentralized finance provides a “trustless” option, allowing you to manage assets more independently. The combination of artificial intelligence and blockchain can detect threats in real time and respond quickly. These technologies have become the core advantages of custody. By 2025, TSS, multi-signature, zero-knowledge proof, and HSM are the current mainstream solutions, providing solid support for the industry.

TSS (Threshold Signature Scheme): Intelligent Management of Keys

TSS, short for Threshold Signature Scheme, is a technology that divides the private key. For example, dividing it into 3 parts, at least 2 parts are required to unlock. What are the benefits? Even if a part is lost, the assets remain secure, and hackers cannot breach. High-net-worth users use it to protect large funds, while novice institutions achieve multi-party management through TSS support from Cactus Custody, which is both secure and practical. This technology is still a recommended choice in 2025.

Multi-signature: Multiple layers of protection

Multi-signature, or Multisig for short, requires the consensus of multiple parties to use funds. For example, in a ‘3-of-5’ model, the agreement of 3 out of 5 keys is required for the transaction to be valid. This is like adding multiple locks to the assets, which enhances security. Institutions use it to ensure team collaboration, while high-net-worth users use it to prevent mistakes. In 2025, multisig remains an important safeguard in custody.

Zero-Knowledge Proof: The Barrier of Privacy

Zero-knowledge proof, abbreviated as ZKP, allows you to prove permissions without revealing private keys or balances. Currently, some custody services have started exploring it to ensure identity verification while protecting asset privacy. By 2025, ZKP will provide a simple and secure experience for retail institutions and bring stronger privacy protection to high-net-worth users, which is a direction worth paying attention to.

HSM (Hardware Security Module): A Solid Security Foundation

HSM, short for Hardware Security Module, is a specialized device that protects keys from attacks. Banks commonly use it to ensure security, and Cactus Custody also uses it to safeguard client assets. Even if the platform encounters issues, the keys remain secure. In 2025, HSM will still be a key pillar of secure custody, providing reliable support to users.

Global trends, continuing to expand

The United States has included Bitcoin in its strategic reserves, completely changing the custody landscape. Countries like Argentina quickly followed suit, and the demand for encrypted custody has shifted from Wall Street to global markets. As a result, small institutions have gained more participation opportunities, and high-net-worth users can seize the trend of globalization. The combination of TSS, multi-signature, zero-knowledge proof, and HSM supports a broader custody network.

Are you ready?

The strength of custody lies in technology and choice. TSS brings flexibility, multi-signature enhances protection, zero-knowledge proof ensures privacy, and HSM provides a solid backing. These mainstream technologies make custody more secure and easier to use. Whether you are a new mobile phone constructor or a senior player, 2025 is an important opportunity to use these technologies to protect wealth.

Part Six: Cactus Custody, the Custody Expert in Asia

Strength escort, guarding huge assets

Cactus Custody is Asia’s leading digital asset custody service provider, founded by Mr. Wu Jihan, focusing on providing secure and compliant solutions for institutions. It is ISO certified, holds a Hong Kong Trust Company License (TC006789), and enjoys regulatory exemptions from the Monetary Authority of Singapore, with impeccable compliance. Currently, it safeguards assets worth tens of billions of dollars, serving over 300 institutional clients globally, covering areas such as mining pools, exchanges, funds, asset management platforms, DeFi, and lending.

Technical support, safe and reliable

How does Cactus Custody ensure security? It adopts bank-level cold storage to isolate assets, HSM encryption machine to protect keys, TSS technology to disperse private key risks, and builds a robust system of cold and hot separation. It can cope with external attacks or internal mistakes with ease. Since its establishment, there is no record of security incidents, proving its strength. Novice institutions use it with peace of mind, and high-net-worth users use it with peace of mind.

Flexible services, improving efficiency

Cactus Custody is not only safe, but also focuses on practicality. It provides flexible custody solutions to help enterprises reduce development and management costs, enhance risk control and operational efficiency. From mining pools to DeFi, from funds to lending, it customizes services for customers. Since its establishment, it has always upheld the principles of safety first and integrity-based, supporting globally leading enterprises in managing digital assets.

Conclusion: Start Your Wealth Protection

Cryptocurrency custody is the solid backing of your wealth. In 2025, the market is full of opportunities and choices are diverse. Novice institutions start with third-party custody and adapt quickly. High-net-worth users safeguard large assets through diversified allocation and technical support.

Take action now. Check your cryptocurrency assets and build up defenses. Unlock the knowledge of custody and embrace the wealth growth in 2025. Want to learn more? Research how to use hardware wallets, or contact custody experts like Cactus Custody to find a solution that suits you.

Interested in Cactus Custody’s customized encryption custody solution? Feel free to email sales@mycactus.com, and our team will respond promptly to provide you with professional answers.

This article comes from contributions and does not represent the viewpoint

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