This is a practical guide; the How. For the Why check out Why You Need Privacy or Bitcoin Fixes This?
Bitcoin ETFs exist now, and they're fine for what they are. If you want Bitcoin exposure in your 401k or IRA, go for it. But make sure you understand when you buy a Bitcoin ETF, you own shares in a fund that owns Bitcoin. You don't own Bitcoin. The difference matters.
With an ETF, you're trusting BlackRock or Fidelity to hold the Bitcoin for you. You're trusting the fund's custodian. You're trusting the traditional financial system to let you access your money when you want it. You're paying management fees forever. And you can only buy or sell during market hours, through a broker, with all the reporting and restrictions that come with traditional finance.
With real Bitcoin, you hold the keys. No one can freeze it. No one can tell you when you can or can't move it. No management fees eating away at your stack year after year. It's yours in the way that nothing in a brokerage account is ever really yours.
The whole point of Bitcoin is self-sovereignty. Not your keys, not your coins.
Here's how I think about it:
Savings (cold storage): The bulk of your Bitcoin should be in cold storage—meaning the keys are held offline, completely disconnected from the internet. This is money you're not touching for years. It's your long-term savings, your retirement fund, your "fuck you" money. It sits there and you forget about it.
Checking (hot wallet): A smaller amount lives in a hot wallet on your phone. This is for spending, for sending to friends, for experimenting with Lightning payments. It's money you'd be annoyed to lose, but it wouldn't ruin you. Think of it like the cash in your physical wallet versus the money in your savings account.
The exact split depends on your situation, but the principle is simple: most of your Bitcoin should be hard to spend. That's a feature, not a bug.
For most people, the best place to start is Strike, CashApp, or River. Any of the 3 will work great as your on-ramp and as a hot wallet for everyday use. Buy Bitcoin, keep some in the app for spending, and withdraw the rest to cold storage. Additionally, these companies are solely focused on bitcoin which means you aren't paying more in fees to support a long tail of other cryptos (like you would Coinbase or Robinhood).
Once you have some Bitcoin worth protecting (this might happen faster than you think), I recommend that you get it off exchanges and into your own custody. A hardware wallet is a dedicated device that stores your private keys offline. Even if your computer is compromised, your Bitcoin is safe because the keys never touch an internet-connected device.
Here are three options at different levels of complexity and security:
Bitkey is what recommend for most people.
Bitkey uses a 2-of-3 multisig setup: you have a key on your phone, a key on the hardware device, and Block holds a recovery key. For normal transactions, you use your phone plus the hardware device. If you lose one, you can recover using Block's key. If you want something that is easy to use and very secure, Bitkey is it.
To get more technical, check out Coldcard
Coldcard is overkill for most people, but a very well-engineered device. The learning curve is steeper, and you might not use all of the functionality, but you have guaranteed minimized trust in third parties. You will be more hands on managing a seed phrase and wallet configuration files.
For the super serious: Unchained
Disclaimer: I am an employee of Unchained
Unchained offers collaborative custody: you hold two keys and Unchained holds one in a 2-of-3 multisig setup. Of top of that we have a suite of financial services: IRAs, Trading, Commercial Lending.
Behind those services we have a world class support team, and if something goes wrong on our end, you maintain control of your Bitcoin. Unchained can't move your funds without your keys, but they can help you recover if you lose one of yours.
It's more expensive than pure self-custody (there's an annual fee), but for large amounts or for people who want a safety net, the peace of mind is worth it.
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