On chain transactions do not scale beyond 7 transactions per second. If we want use cases beyond SoV including a full fledged global currency, we will need to make some concessions. Different wallets serve different use cases.
  • Prime HODL wallet. Stays cold. Don't use it for anything beyond large infrequent on chain transactions that justify high tx cost. This is your sovereign vault and most secured wallet.
  • Hot wallet(s) (custodial) for spending cash and making small frequent transactions. This is typically Layer 2 (Lightning, Ecash e.g.) This is your day to day cash on hand wallet - small transactions, tiny fees. In theory, you trust the custodian. Rug pull? Stings in principle, but should not materially hurt you financially.
  • Keep a staging wallet between your hot and cold wallet. This wallet is non-custodial, and you use it for DCA inputs or bitcoin receipts and it funds your hot wallet with the minimum required, and if or when it builds up enough value to transfer to prime HODL, then you transfer there for cold storage.
Let's say the mint is Starbucks, or Amazon.com or your local farmer's market. They have a reputation to maintain and they have earned some people's trust. If they offer an Ecash solution that enables people to move from fiat and fiat gift cards to bitcoin backed IOUs, is this not a win for Bitcoin? Yes, there are custodial shortcomings and it violates the principle of NYKNYC, but that seems like a worthy tradeoff to help scale Bitcoin based transactions FAR beyond 7 TPS.
Again, we would advise people to keep the minimum in their Hot Wallet because NYKNYC.
Yes, you don't need to most secure network to ever exist to buy a coffee.