Bloomberg senior ETF analyst Eric Balchunas commented on the Coldcard wallet security incident, saying he had just learned the company’s team consists of only five employees. In his view, that is far too small for a company of such importance and should raise concerns for users considering where to store significant assets. Balchunas framed the issue with a comparison to traditional finance, asking whether anyone would trust a bank with only five staff members to safeguard their life savings. He said that while such a setup may be seen as part of crypto’s culture, he views it as an obvious red flag. He also contrasted Coldcard with larger organizations such as Coinbase and Ledger, arguing that firms with bigger teams may have stronger security investment and operational capacity, even if users face higher transaction costs. As another route, he pointed to spot Bitcoin ETFs, saying they offer exposure with the security protections of large, professional, regulated financial institutions while also carrying lower management fees.
Bloomberg senior ETF analyst Eric Balchunas weighed in on the Coldcard wallet security incident, saying he had just learned that Coldcard’s team has only five employees.
Balchunas said that number is simply too low for a company he sees as important. He asked whether people would be willing to use a bank with only five staff members to hold their life savings. That structure may be part of the character of the crypto sector, he said, but to him it is a clear warning sign.
He added that larger organizations such as Coinbase and Ledger may have an edge in security spending and operational capacity because of their greater scale, even if users end up paying higher transaction costs.
Balchunas also said Bitcoin ETFs offer another option. In his view, investors can get security protections from large, professional, regulated financial institutions while also benefiting from lower management fees.
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