Struggling Custodial Company Swan Bitcoin Forces Users to Pay Admin Fee to Hodl Their Coins

Swan Bitcoin, a company that positions itself as a Bitcoin only financial services custodian, has recently stirred up the community with a controversial move. As part of their transition away from Fortress Trust, Swan users found themselves unexpectedly hit with a $125 admin fee, a decision that has left many in the Bitcoin community questioning the integrity and stability of the platform.

Swan, known for its commitment to Bitcoin only and its straightforward approach to dollar-cost averaging (DCA), has been navigating through a rough phase of cryptocurrency infrastructure. This tumultuous period is characterized by frequent changes in custodians and service providers, a reality that has now led to unexpected costs for its users. The recent imposition of an admin fee by Fortress Trust on Swan's clients, is a significant deviation from the user expectations of a seamless and cost-transparent Bitcoin holding experience.

The community's reaction was swift and varied. Some users expressed their frustration on social media, highlighting the lack of transparency and the abrupt nature of this fee. Swan's response was to dispute this fee, asserting it does not align with the service agreement between Fortress and its users. Moreover, in a gesture of goodwill, Swan promised to offset these fees by covering Bitcoin buy fees up to twice the amount of the Fortress fee in the first half of 2025.

As one user on X put it,

If swan had any dignity it would cover the "admin fee," instead of asking us to invest more money on a shady platform and covering the "fees."

This incident sheds light on a broader issue within the Bitcoin and broader crypto ecosystem: the reliance on third-party custodians and the potential vulnerabilities this introduces for individual investors.