It's the short term option, yes. Well, they have to hold on to the coins, because once they lose it, they can't turn to Fed for a bailout. Lots of custodians have insurance in place [1].

In the long term, lightning is here and works, as exchanges keep integrating it, that's where most of the end-user funds for small amounts would live.

1: https://finance.yahoo.com/finance/news/bitgo-expands-cold-st...