CTV+CSFS: Can we reach consensus on a first step towards covenants?

In the realm of Bitcoin custody solutions, vaults have been a topic of significant debate among experts and industry leaders. Bob McElrath, known for his research on vaults at Fidelity Digital Assets, one of the premier Bitcoin custodians globally, has shared insights based on his extensive experience. Despite the theoretical advantages of vaults, McElrath’s observations suggest that they may not be as beneficial in practical terms. Similarly, the CEO of Nunchuk, a widely used Bitcoin wallet since 2021, has expressed skepticism regarding the practicality of vaults for everyday users, often referred to colloquially as "plebs." This sentiment is echoed by the CEO of Wizardsardine, who, after years of developing vaults and other advanced custody products, concluded that the general preference leans away from the complexities associated with managing a vault.

The discourse around Bitcoin vaults reveals a nuanced view of their application and utility. While vaults are designed to enhance security and provide users with more control over their digital assets, the feedback from industry insiders points to a gap between the conceptual appeal of vaults and their real-world applicability. This discrepancy raises questions about the barriers to adoption and the inherent challenges faced by users in navigating the complexities of vault management. Furthermore, the discussion highlights an ongoing debate within the community regarding the need for vaults with covenants, which are sought after by several developers and companies with successful products and services. The resistance against diversifying the types of vaults available to users underscores a broader conversation about innovation, user autonomy, and the future of secure asset custody in the digital age.