The way coinbase is setup, even if someone hacked into their online server and had full access to everything, they could only access a very small number of bitcoins.
I don't think the mass of people will take the time to store their bitcoins in a paper wallet. People just won't do that.
Well it's their loss.
I mean sure, nobody says not to have an on-line wallet. But if you have a large sum of money (more than the average amount of cash you carry with you), you should put it on a paper wallet.
Having $100 in an online wallet can make it easier to order pizza for bitcoin, or whatever.
And there's nothing strange or new about this. Some 40 years ago, bearer bonds and materialized stocks were still a thing, and most rich people kept their reserves in a private safe somewhere in the form of paper.
If you have 100 bitcoins, keeping the code on any electronic device would be madness. Keeping them on an online server would be...
Bugs Bunny and Daffy Duck flipping out insane.
Print it out, seal it in an envelope, stamp it down with your family signet ring, or whatever, and keep it in a floor safe.