Rabbit Hole Recap RABBIT HOLE RECAP #401: BETTER BITCOIN WALLETS
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Mar 20, 2026 Discussion of hardware wallet risks and a Kentucky bill that could force seed resets. New wallet launches and migrations, including Primal 3.0 and Spark tradeoffs. Noncustodial Lightning swaps to USDT and a Nostr-based VPN project. GPU smuggling and export-control challenges. Energy rationing across Asia amid Strait of Hormuz tensions.
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Fight State Attempts To Force Hardware Wallet Backdoors
- Do oppose laws that mandate hardware wallet backdoors because they are technically impossible and would destroy self-custody options.
- Kentucky HB380 would force providers to reset seed phrases, which would practically ban hardware wallets from that state if enforced.
Export Controls Drive Black Market GPU Smuggling
- Export controls on high-end AI GPUs are likely ineffective and push critical hardware into black markets where tracking is impossible.
- Super Micro co-founder reportedly pasted serial numbers and shipped $2.5B of NVIDIA GPUs to China, showing enforcement limits.
Use Hot Wallets For Spending And Cold Storage For Savings
- Try user-friendly Lightning hot wallets to improve Bitcoin spendability while keeping savings offline in cold storage.
- Primal 3.0 moved to LightSpark/Spark, migrated 7,000 wallets, offers instant receive and no KYC but is a hot wallet.