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The service is designed to compete with larger third-party custodians such as Coinbase.
New Self-Custody Solution for Nation-States Emerges
Crypto self-custody firm Casa announced that it will now offer a self-custody solution called Praetorian to governments seeking to establish national bitcoin (BTC) reserves. The announcement was made on Monday by Casa CEO Nick Neuman at the Bitcoin MENA conference in Abu Dhabi.
The concept of nation-state bitcoin treasuries is picking up steam after the incoming Trump administration announced its intention to establish a one million BTC strategic reserve for the United States.
Institutional investors typically employ the services of experienced third-party custodians to store their digital assets. Investment firms behind the largest spot crypto exchange-traded funds (ETFs) like Blackrock and Fidelity Investments recruited crypto exchange Coinbase to store their bitcoin and ether, but Neuman insists that self-custody is a superior option.
“Your country’s bitcoin shouldn’t be held by somebody else,” Neuman posted on X. “Long before bitcoin, nations have had trouble holding sovereign reserves, and the risks increase when assets are held with third parties.”
Casa uses Bitcoin’s multi-signature functionality (or more commonly just “multisig”) which requires more than one signature to spend funds. For example, a wallet with a “2-of-3” multisig has three private keys, but only two are required to spend funds. Casa keeps one key while the user keeps the other two. If the user loses one key, they can still access their funds with the remaining one in conjunction with the third key held by Casa.
“Today, a nation can and should take self-custody of its private keys,” Neuman said. “With our Sovereign Recovery protocol, your bitcoin remains accessible with open-source software in the event Casa is unreachable.”
Casa’s website says the firm secures “billions in digital assets.” Coinbase is a public company with more than 3,600 employees and $273 billion in assets under custody (as of September). It is America’s largest cryptocurrency exchange and custodian of ten of the twelve spot bitcoin ETFs and eight of the nine spot ether ETFs.
Most countries will likely gravitate toward the larger firm, but Neuman wants to change the status quo.
“Your government reserves should not be dependent on a third-party,” Neuman said. “With legacy financial assets, the norm is to use a custodian, but that is a sub-optimal way to hold bitcoin as a country.”