When Jeff made my Badger Attack leather sheath he put a kydex anti-stab-through plate inside behind the blade. So the nice bushcrafty style sheath has some nice safe thick kydex in it.. Win-win!

I'd say kydex for a safer carry, though kydex will shatter if it gets too cold and leather for more durability in cold climates and for it's good looks. Or even better get Jeff (Rainwalker) to kydex plate some leather for you!