Bitcoin Faces ‘Nation-State Rug Pull’ Risk, Warns Willy Woo

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Bitcoin might be the “perfect asset” for the next millennium, but according to veteran Bitcoin analyst Willy Woo, perfection isn’t enough. Without massive capital inflows, systemic risks could keep BTC from ever rivaling the US dollar or gold.

Speaking at the Baltic Honeybadger conference in Riga, Woo didn’t hold back:

“You don’t get to change the world unless this monetary asset – in my opinion, the perfect asset for the next thousand of years – does its job. And it can’t do its job unless capital flows in and gets big enough to rival the US dollar.”

Right now, Bitcoin’s $2.42 trillion market cap is just a fraction of gold’s $23 trillion and far behind the US dollar’s $21.9 trillion money supply. The gap, Woo warns, reflects structural vulnerabilities that could hit hard in the next downturn.

The Silent Dangers in Corporate Bitcoin Holdings

Woo pointed to corporate Bitcoin treasuries as a double-edged sword. While they’re accelerating adoption, their debt structures remain largely opaque.

“No one’s really publicly looked deeply into the debt structuring,” he said. “I absolutely think the weak ones will blow up, and people can lose a lot of money.”

In a bear market, that could mean forced liquidations flooding the market with BTC.

Watch: https://t.co/926Tl2Qb9A

— Efrat Fenigson (@efenigson) August 10, 2025 Custody Concentration: A Nation-State ‘Rug Pull’ Risk

The other red flag? Custody centralization.

Many big-money players are opting for spot Bitcoin ETFs, pension funds, and institutional custodians like Coinbase Custody instead of self-custody. Woo warns this puts too much Bitcoin “within arm’s reach of nation-states,” opening the door to a government-led rug pull.

“It’s attracting flows,” he said, “but the investors with the money bags aren’t self-custodying.”

Self-Custody as the Endgame

Panelist Max Kei, CEO of Bitcoin self-custody platform Debifi, argued that self-custody adoption will spread in stages – from custodians, to companies, and finally to individuals.

Adam Back, Blockstream CEO, countered that companies remain the most logical starting point for adoption. If a business can’t beat Bitcoin’s expected returns, he said, “they should close up shop and buy Bitcoin.”

Bitcoin’s long-term potential may be unmatched, but Woo has a point. Without decentralizing custody and addressing corporate debt risks, the “perfect asset” and its investors could be left vulnerable.