The most effective way to steal Bitcoin targets the user's mind, not their wallet software. Joe Kelly of Unchained argues that scammers use leaked personal data and high-pressure urgency to trigger a mistake before rational thought can intervene. While Bitcoin newcomers and older investors are often cited as targets, Kelly claims the human vulnerability to social engineering is universal.

Technical solutions are secondary. The primary defense is a custody structure that accounts for human error and coercion. Kelly points to multi-signature setups, where moving funds requires two out of three keys, as the critical safeguard. This method prevents the all-or-nothing loss from a single compromised seed phrase.

Joe Kelly, BTC Sessions:

- It is a social engineering problem.

- It is less technical or technological.

Owership of Bitcoin creates a legal distinction. Cryptographic control does not solve the friction of inheritance or taxes. Institutions provide the traditional documentation accountants and judges demand. A Bitcoin address alone fails to prove ownership to the IRS or a probate court.

This creates a divide between total privacy and operating within the existing system. Larry Lepard frames self-sovereignty as a spectrum. The highly paranoid can treat Bitcoin as a hidden bearer asset. The average holder must balance direct control with the protections of a legal framework that requires documented proof.

Larry Lepard, BTC Sessions:

- Self-sovereignty has always required personal responsibility.

- There is some segment of the population that does not want to take personal responsibility.

History warns that centralized custody carries unique confiscation risks. Lepard cites Executive Order 6102, where the U.S. government seized gold directly from bank vaults. While privately held Bitcoin is harder to confiscate, most users eventually need a regulated bridge to the traditional economy. True ownership requires a plan to defend it both cryptographically and legally.