I'm not as sanguine as Szabo about Coinbase holding a huge pile of Bitcoin, but he makes an interesting point about the difference in self-custody cost between an institution and an individual.

Bitcoin is, currently, a little bit less expensive than physical gold for individuals to self-custody (custody costs and risks) and far less expensive and quicker to transfer (validation/assay costs and risks and global settlement).

Bitcoin is so far neither considerably cheaper nor more expensive than gold for institutions to hold, because of the trust/control issues involved in institutional custody.

Technology can make Bitcoin considerably cheaper to self-custody, both for individuals and institutions, but that is a set of technologies that are slow to mature, not widely understood, and require very different kinds of institutional trust/control support that are even less well understood, as well as otherwise overcoming the long institutional habits of Wall Street and banks to centralize custody.

There's considerably less room to improve self-custody and validation costs for the 6,000 year old technology of gold -- not impossible, just less room for improvement.

This means that the current emabarassing centralization of Bitcoin at mega-custodian Coinbase is a temporary phase in Bitcoin's bumpy path to maturirty, whereas centralization of gold in bank vaults is unlikely to change much.