are crypto owners naturally paranoid? - page 8.

Lucius

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Quote from: krusepig on November 12, 2021, 07:20:34 AM

It seems to me that it would be safer (and more convenient) to keep your crypto on an exchange (coinbase, blockfi etc) than cold wallet.

For some people, this may indeed be a safer option if we consider that all the user needs is a username and password, and to be careful about phishing, with the hope that the exchange will not be hacked or that the owner(s) will not disappear/die and take everything into the unknown. However, a properly made cold wallet is still the safest, but it should be noted that hardware wallets do not fall into this category - you will still need to connect them to the Internet from time to time.

Quote from: krusepig on November 12, 2021, 07:20:34 AM

Wouldn't the odds be greater that you mess up your cold storage than a large exchange being hacked or whatever (even if they are hacked, that wouldn't necessarily mean you would lose any coins, whereas if you are hacked that's a different story). I ordered a ledger nano X but it seems that the exchanges are still the way to go based on probabilities. What are your thoughts?

Mess up with a cold wallet? You can hardly do this if you are sufficiently informed, which leads us to the conclusion that any type of crypto wallet is not resistant to human stupidity - and now the only question remains whether a user will click on the phishing link or save their seed online (e-mail, cloud) and be hacked. As other members have already mentioned, Bitcoin isn't really yours if you don't have full control over your private keys - so I wouldn't even ask if one option is more secure than the other, but what is the correct storage method and what isn't.

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In fact, I will feel paranoid if keep money in the exchange. There will always be problems faced and vulnerable to being hacked from outside or inside the exchange. I prefer to use a cold wallet because it is safe and we can control the address.

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Cryptocurrency owners are mostly just one of the two:

Risk takers: obviously, bitcoin and cryptocurrencies are a new concept, with higher levels of risk compared to traditional assets, but with higher potential reward.
Ignorant: yea, those people who think their crypto of choice is guaranteed to go to the moon or something.

As for hardware wallet users, yea you can probably make the assumption that they're paranoid, but it's mostly just them being smart. Because they've learned about people's mistakes in the past(MtGox, Bitfinex, etc), and they wouldn't want it to happen to them. Tongue

And if you think storing your coins on exchanges is safer: https://cryptosec.info/exchange-hacks

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Quote from: krusepig on November 12, 2021, 07:20:34 AM

It seems to me that it would be safer (and more convenient) to keep your crypto on an exchange (coinbase, blockfi etc) than cold wallet.

More convenient yes, safer, no!

Quote from: krusepig on November 12, 2021, 07:20:34 AM

Wouldn't the odds be greater that you mess up your cold storage than a large exchange being hacked or whatever (

If you think you can mess your own cold storage by doing something wrong, then it's highly possible you can get a virus on your laptop/mobile, you can have your email hacked, you can be a victim of sim swapping, and many more which would completely invalidate any claims you could do to the exchange or wallet provider. Besides that, how many times have exchanges just disappeared or a "hack" has left them bankrupt? Do you honestly believe in the SAFU buzzword? If Binance's cold wallets are emptied there is no way in hell anyone would get even one-tenth of what they have, there is real insurance other than some man's word.

And that's not all, forget hacks and malware and password stealing.
The exchange might decide that the picture of your ID is a bit fishy or that you've sent tainted coins and they freeze your account until you come with a complete history of your coins and proof of how you earned the money to buy them. My ledger never asked me this, nor does it care about Grin

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If you don't have exclusive control of the private key associated with a bitcoin address, then you don't have the bitcoins that are associated with that address.
(frequently paraphrased as "Not your keys, not your bitcoin")

If you keep your bitcoins on an exchange, then you are donating your bitcoins to some other people in exchange for a promise from them that they will send an equal amount of THEIR coins wherever you ask them to whenever you ask them to. It's up to you how much faith you want to put into that promise. I prefer to have actual bitcoins instead of promises.

Can exchanges be hacked? Can they get shut down or disappear? Perhaps try asking those that had coins at MtGox.

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Quote from: krusepig on November 12, 2021, 07:20:34 AM

It seems to me that it would be safer (and more convenient) to keep your crypto on an exchange (coinbase, blockfi etc) than cold wallet. Wouldn't the odds be greater that you mess up your cold storage than a large exchange being hacked or whatever (even if they are hacked, that wouldn't necessarily mean you would lose any coins, whereas if you are hacked that's a different story). I ordered a ledger nano X but it seems that the exchanges are still the way to go based on probabilities. What are your thoughts?

So you prefer convenient over security ? The exchanges can run away with your funds and you cannot do anything about it.
However if you have a hardware wallet and you messed up its security key or passphrase, then again you will lose your funds. If you are that careless with your money, i am afraid you will sooner of later lose your coins.

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You will become paranoid if you trust your bitcoins to an exchange. Just try it, but it doesn't have to be a small amount. Above there was already a very competent answer, are you ready to trust your money to someone if there are good ways to store it?
The only thing you need is knowledge of storing your passwords. There is a good proverb: "if you want to do well, do it yourself." There is nothing better than to rely on and always trust only yourself.

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Quote from: krusepig on November 12, 2021, 07:20:34 AM

It seems to me that it would be safer (and more convenient) to keep your crypto on an exchange (coinbase, blockfi etc) than cold wallet. Wouldn't the odds be greater that you mess up your cold storage than a large exchange being hacked or whatever (even if they are hacked, that wouldn't necessarily mean you would lose any coins, whereas if you are hacked that's a different story). I ordered a ledger nano X but it seems that the exchanges are still the way to go based on probabilities. What are your thoughts?

A third party wallet wouldn't be safer than the wallet you really hold, of course it's your responsibility and strategy on how to manage it properly. Just because the funds are SAFU? It's a great responsibility holding your own asset and as I said, keep it somewhere safe, change password/code regularly and other precautionary measures on safety of your asset. I wonder and wanted to know on what are those probabilities, mind you lay it here?

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Quote from: krusepig on November 12, 2021, 07:20:34 AM

It seems to me that it would be safer (and more convenient) to keep your crypto on an exchange (coinbase, blockfi etc) than cold wallet. Wouldn't the odds be greater that you mess up your cold storage than a large exchange being hacked or whatever (even if they are hacked, that wouldn't necessarily mean you would lose any coins, whereas if you are hacked that's a different story). I ordered a ledger nano X but it seems that the exchanges are still the way to go based on probabilities. What are your thoughts?

You sound like someone who has a lot of opinions about crypto but don't hold much crypto yourself.

Bitcoin owners who take a lot of precautionary measures have so much Bitcoin that you can't even imagine. People who have 10, 100 or 1,000 bitcoins are not stupid, and as they are not stupid they do not leave what is theirs in the hands of third parties, besides not having everything in one cold storage. The normal thing is to have it in several and the keys well stored and in different places, besides using multisig, etc.

If you have $100 in Bitcoin or crypto, it's OK to leave it in an exchange, but as you get more and more and learn the meaning of "not your keys..." you start to take more security measures, and that has nothing to do with being paranoid, but rather with being smart.

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It happens on Binance before where some of the users lost their coins due to the hacking activity but they managed to track the hacker. you can find it here: https://portswigger.net/daily-swig/binance-awards-200-000-bounty-after-cyber-attackers-indicted-in-us

Due to this kind of incident, it is mandatory for people who hold huge amounts of crypto currencies to own a ledger to keep their crypto-asset personally without worrying about the exchanges they usually used to be hacked.

Therefore, no one really gets paranoid if they have their own hard wallet where they can control their crypto assets freely.

krusepig

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It seems to me that it would be safer (and more convenient) to keep your crypto on an exchange (coinbase, blockfi etc) than cold wallet. Wouldn't the odds be greater that you mess up your cold storage than a large exchange being hacked or whatever (even if they are hacked, that wouldn't necessarily mean you would lose any coins, whereas if you are hacked that's a different story). I ordered a ledger nano X but it seems that the exchanges are still the way to go based on probabilities. What are your thoughts?

Topic: are crypto owners naturally paranoid? - page 8. (Read 986 times)