I'm interested to know if there are known solutions, even if just theoretical, to enable people to have highly secure self-custodial Bitcoin, without main chain transactions for each person. If so, are there any technologies implemented or in the works that will achieve this? If they are not implemented yet, what needs to happen to get something to that state. Will there always be security reduction for off-chain technologies?
People tout Liquid. It is a very useful tool, but it is a massive security tradeoff.
Far as I can tell, Lightning can't easily be self-custodial yet. Can it be in the future? / what does it need to get there?
Fedimints will help provide trust-minimized custodial system, a massive security trade off.
I've seen other tools mentioned, but I'm not sure of their relation to this particular question: Ark, Ecash, Mercury, etc.
Maybe actually trustless sidechains that piggy back on Bitcoin's security are possible?
Obviously, there's probably lots of controversy related to this, but I would love to read people's thoughts