It's a custodian without the legal protections afforded by current custodians, you trade that for the privacy aspect, and you select how much risk/exposure is right for you.

I think for these mints/federations to work, you need to have a relationship with the custodian, a friend, family member, local leader, that's not to say they can't or won't rug you and everyone in the mint, but if people know where you live, it is a deterrent.

This custody model is pretty popular in South Africa, one person has a bank account/manages cash for the community, we call it stokvels, and these stokvels hold millions of dollars/billions of South African rands and I think it works for small purchases low value, and if you build wealth you go your own way