Don't trust web wallets, don't trust exchanges, then where to trade?

jessyj48

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Quote from: shield132 on February 06, 2021, 05:40:06 PM

Not your keys - not your coins, that's 100% true but for some people, I would say: Even your keys - not your coins.

Okay, woud love to hear opinion about this from the community members.

As we know and from every logic, we shouldn't trust web wallets and also exchanges. There were a lot of accidents when exchanges were hacked and people lost their coins. Some may say - don't keep your coins at exchanges for a long time but I would say that everything happens in seconds, maybe you had access on your coins at exchanges while you were replying to this thread but once you submitted the post, exchange got hacked and coins were lost, everything happens in seconds, otherwise loss wouldn't occur.

So, how do you trade in these cases? Only p2p exchanges? But it's not flexible and you may miss a good time frames where you could profit 1-2% of your balance.

I trust exchanges more than web wallets because exchanges can sti be hold responsible if anything bad happens but web wallet will vanish without any traces, though exchanges are of different types, I'm not talking about exchanges that don't care about reputation, I'm talking about binance, kucoin, huobi etc

magneto

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Quote from: shield132 on February 06, 2021, 05:40:06 PM

Not your keys - not your coins, that's 100% true but for some people, I would say: Even your keys - not your coins.

Okay, woud love to hear opinion about this from the community members.

As we know and from every logic, we shouldn't trust web wallets and also exchanges. There were a lot of accidents when exchanges were hacked and people lost their coins. Some may say - don't keep your coins at exchanges for a long time but I would say that everything happens in seconds, maybe you had access on your coins at exchanges while you were replying to this thread but once you submitted the post, exchange got hacked and coins were lost, everything happens in seconds, otherwise loss wouldn't occur.

So, how do you trade in these cases? Only p2p exchanges? But it's not flexible and you may miss a good time frames where you could profit 1-2% of your balance.

You have to accept a certain extent of risk as a fact of life.

There is no absolutely risk-free or trustless way of trading, unless you are using a completely decentralised finance platform (i.e., a DEX).

Even with P2P/OTC trading platforms, the period of time when you have your coins deposited on the platform carries risks. LBC could freeze your account, go bust, who knows.

But what you can do is control the stuff that is in your control, namely minimising the amount of time that your coins stays on exchanges. There is absolutely nothing wrong with using a centralised exchange as long as you *manage* these risks properly.

ene1980

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Quote from: Ultegra134 on February 14, 2021, 04:57:38 PM

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I've used Xapo at one point (2015-16) and BitGo, which until recently had the majority of my coins. I had no issues with BitGo, I was also provided with the private keys on sign-up. Furthermore, I never had any issues with the support or the wallet itself. It's one of the online ones I would totally recommend. It also supports Litecoin and Bitcoin Gold or Cash, don't remember which of the two.

I am yet to explore BitGo but i used Xapo and Coinbase in the past when there were literally no transaction charges and i used to enjoy sending coins for free but once they came out with variable fees i just stopped using them altogether but i do use Coinbase as it is convenient now to purchase the coins.

Quote from: Ultegra134 on February 14, 2021, 04:57:38 PM

Xapo on the other hand, is lacking support. I haven't used it for years, but when I tried to recover my account, their support was unhelpful. It's been over 10 days and still haven't managed to recover it.

Xapo has the worst support team and it will take a long time to get any response from them and their mobile app is crap as well.

Ultegra134

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Quote from: ene1980 on February 14, 2021, 12:10:55 PM

Quote from: shield132 on February 06, 2021, 05:40:06 PM

So, how do you trade in these cases? Only p2p exchanges? But it's not flexible and you may miss a good time frames where you could profit 1-2% of your balance.

There are literally no restrictions in trading in reputed exchanges and if you think you trust the exchange then you carry on with your usual business. The only advice anyone sensible would give is not to use web wallets or exchanges to hold the coins for the long term as there are many who does the simple mistake of holding the coins for the long term in exchanges for the ease of trade because of the network congestion.

I've used Xapo at one point (2015-16) and BitGo, which until recently had the majority of my coins. I had no issues with BitGo, I was also provided with the private keys on sign-up. Furthermore, I never had any issues with the support or the wallet itself. It's one of the online ones I would totally recommend. It also supports Litecoin and Bitcoin Gold or Cash, don't remember which of the two.

Xapo on the other hand, is lacking support. I haven't used it for years, but when I tried to recover my account, their support was unhelpful. It's been over 10 days and still haven't managed to recover it.

ene1980

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Quote from: shield132 on February 06, 2021, 05:40:06 PM

So, how do you trade in these cases? Only p2p exchanges? But it's not flexible and you may miss a good time frames where you could profit 1-2% of your balance.

There are literally no restrictions in trading in reputed exchanges and if you think you trust the exchange then you carry on with your usual business. The only advice anyone sensible would give is not to use web wallets or exchanges to hold the coins for the long term as there are many who does the simple mistake of holding the coins for the long term in exchanges for the ease of trade because of the network congestion.

mk4

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Quote from: shield132 on February 08, 2021, 01:18:38 PM

Wanted to transfer 0.7 Bitcoin and electrum wallet was warning me that the recommended fee would be higher than 5.7% of the initial amount. I guess 5% of 0.7 bitcoin isn't small and it's a pretty good profit in USD if we consider the amount. I think it's illogical to pay that much fees and some exchanges somehow don't accept SegWit transfers (that's another embarrassment). The idea of this thread is not to push people to leave their funds on exchanges. I just want to find the "Golden Ratio" (sweet spot).

You don't have to necessarily use the "recommended" fees by whatever wallets. In the first place, wallets are mostly notorious for recommending unnecessarily high fees. You can pay as much as a few cents worth of transaction fees if you don't need the funds ASAP.

Quote from: shield132 on February 14, 2021, 03:15:02 AM

What's the long term in this case? What if I just deposited bitcoins and plan to store it for two days but tomorrow exchange got hacked and my funds are stolen? Once your bitcoins are gone, they are lost. Crypto isn't a bank's payment service where funds are under their control and if hack happens, they are easily able to get the money back, that's why exchanges need the highest security standards and well-written codes.

So, from the moment you send your cryptos to exchange, there is a risk that you may lose it.

The trick is to minimize the time of parking your funds on exchanges. Not planning on using it yet? Then don't deposit it yet.

And again, trading in itself is subjective. So if you don't like the risk of leaving a small amount of your funds on exchanges, then don't risk it. On the other hand, some people are totally fine with it as long as they can make as much money and withdraw the profits as much as possible.

Quote from: shield132 on February 14, 2021, 03:15:02 AM

But I have a question, why the f do I have to worry about that? If exchange got hacked, it's their fault, not mine and they should pay for any financial loses. That's why I think that PayPal and other top companies will come over current exchanges.

Because when exchanges are totally cleaned out, even if they wanted to cover the lost funds of their users, they wouldn't be able to afford to do so.

As for PayPal, yea, assuming they're holding real BTC(and not CFDs) then there's also the possibility of them losing the bitcoin of their users. It might just be the case that they have A LOT more money to cover losses compared to other far smaller exchanges.

shield132

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Quote from: adzino on February 12, 2021, 01:48:35 PM

When people said don't trust exchanges, they didn't mean that you shouldn't use them. They meant that you shouldn't store your coins for long term in any exchange. Do your exchange/trading and then when you are done trading, move your coins as soon as possible. Don't use those exchange wallet as long term storage wallet. Bad idea. Exchanges might get hacked or your account might get compromised and you will end up losing everything.
As for webwallet, just avoid those at all cost. These are the least secured wallet where you can store your coins.

What's the long term in this case? What if I just deposited bitcoins and plan to store it for two days but tomorrow exchange got hacked and my funds are stolen? Once your bitcoins are gone, they are lost. Crypto isn't a bank's payment service where funds are under their control and if hack happens, they are easily able to get the money back, that's why exchanges need the highest security standards and well-written codes.

So, from the moment you send your cryptos to exchange, there is a risk that you may lose it.

But I have a question, why the f do I have to worry about that? If exchange got hacked, it's their fault, not mine and they should pay for any financial loses. That's why I think that PayPal and other top companies will come over current exchanges.

sunsilk

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Quote from: electronicash on February 12, 2021, 02:13:14 PM

an alternative solution is to just use the hybrid wallets that you can use to connect to exchanges and trade from there. you got your coins on your wallet where yo own the private keys and then you can also trade safely/.

But the fees are entirely different from directing to the exchanges where you want to trade. That wallet has a cut if it's integrated into an exchange that they're partnered with. Yes, it is convenient as you don't have to move from your wallet to exchanges.

But, there's one disadvantage that you need to accept and take and that is the fees and rates are different from the usual exchange that we use. They're much higher. I guess you have to accept any of those disadvantages, either pay the network fees which are also high, or just accept the fact that rates are different and there are adjustments for your convenience.

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Quote from: Darker45 on February 12, 2021, 08:22:18 PM

To those who are purely hodling, they may entirely avoid web wallets and exchanges. They can do it. But to those who are actively trading or at least still interested to take the opportunity to trade once in a while when there are huge swings in the market, spikes in prices, and so on, they cannot really avoid exchanges.

So they need to manage risks and know better than having their funds sleep in exchanges. The downside of this is that things may happen very quickly with the prices, and moving funds from your cold wallet, for example, to your exchange wallet may take some time and you might miss your price target.

Because a lot of us can't avoid to use exchanges, better use exchanges with insurance like Binance. This exchange, I am pretty confident to store coins in few days while waiting for the right timing to trade. Sometimes, we need to store for a bit of time our coins in exchanges because of waiting the right time to trade your coins. And for me, if you will keep your coins a lil bit longer, better do it in trusted ones like binance. So even if they are hacked during those time period, you are insured and you know, you can get back your coins.

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To those who are purely hodling, they may entirely avoid web wallets and exchanges. They can do it. But to those who are actively trading or at least still interested to take the opportunity to trade once in a while when there are huge swings in the market, spikes in prices, and so on, they cannot really avoid exchanges.

So they need to manage risks and know better than having their funds sleep in exchanges. The downside of this is that things may happen very quickly with the prices, and moving funds from your cold wallet, for example, to your exchange wallet may take some time and you might miss your price target.

Ultegra134

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Quote from: electronicash on February 12, 2021, 02:13:14 PM

if you keep trading every day, you are bound to just let your coins stay on the exchange for as long as you want to trade. its cost if you send back and forth the coins to your wallet to exchange wallet every time. but limit something like $2000 only on the exchange, from there you can keep trading and you won't be crying for mercy when the hacker got your money.

an alternative solution is to just use the hybrid wallets that you can use to connect to exchanges and trade from there. you got your coins on your wallet where yo own the private keys and then you can also trade safely/.

Massive hacks in exchanges aren't the most common thing (not an isolated incident though), especially the most known ones, such as Kraken or Bitstamp, and many more. I understand that it is a worrisome event, if it ever happens. Many incidents have also happened due to compromised accounts from database leaks in various sites, setting up a 2FA and different passwords is considered vital.

Here's an article about the most major Cryptocurrency Exchanges' hacks. Let's hope that they've learned from their mistakes and these kind of incidents don't happen again.

https://selfkey.org/list-of-cryptocurrency-exchange-hacks/

electronicash

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if you keep trading every day, you are bound to just let your coins stay on the exchange for as long as you want to trade. its cost if you send back and forth the coins to your wallet to exchange wallet every time. but limit something like $2000 only on the exchange, from there you can keep trading and you won't be crying for mercy when the hacker got your money.

an alternative solution is to just use the hybrid wallets that you can use to connect to exchanges and trade from there. you got your coins on your wallet where yo own the private keys and then you can also trade safely/.

adzino

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When people said don't trust exchanges, they didn't mean that you shouldn't use them. They meant that you shouldn't store your coins for long term in any exchange. Do your exchange/trading and then when you are done trading, move your coins as soon as possible. Don't use those exchange wallet as long term storage wallet. Bad idea. Exchanges might get hacked or your account might get compromised and you will end up losing everything.
As for webwallet, just avoid those at all cost. These are the least secured wallet where you can store your coins.

$crypto$

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Quote from: Ridwan Fauzi on February 12, 2021, 11:42:44 AM

Indeed, that is true, there may a few exchange who still clean from hacked event. But, that is not a guarantee that the exchange has a high security until the hacker tire to hack it. They still have a chance to be hacked, maybe that is the matter of time.

But, I'm a trader it means I need to put my money in the exchange, it is impossible to pull my money in the exchange frequently. I only withdraw all of my fund once a week when I get a profit from my day trade at least it will make me comfortable. More than that, I use binance exchange which is trusted until now, they will be responsible to change my fund when something bad happen.

As long as we don't worry too much, I'm sure all the big exchanges will definitely bear everything if something bad happens to the exchange, I also didn't put money in the exchange for too long but when conditions like this mean the market is busy then of course I will put it in it took months but there were also many transactions in and out just to attract profits and capital if needed.

In the internet, no matter how strong the security is, there must be loopholes but we don't need to doubt that I think Binance is the best and safest exchange to date so we can still save more funds but for sure if the worries persist then use a hardware wallet much more safe or Hardware.

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Indeed, that is true, there may a few exchange who still clean from hacked event. But, that is not a guarantee that the exchange has a high security until the hacker tire to hack it. They still have a chance to be hacked, maybe that is the matter of time.

But, I'm a trader it means I need to put my money in the exchange, it is impossible to pull my money in the exchange frequently. I only withdraw all of my fund once a week when I get a profit from my day trade at least it will make me comfortable. More than that, I use binance exchange which is trusted until now, they will be responsible to change my fund when something bad happen.

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Quote from: shield132 on February 06, 2021, 05:40:06 PM

As we know and from every logic, we shouldn't trust web wallets and also exchanges. There were a lot of accidents when exchanges were hacked and people lost their coins. Some may say - don't keep your coins at exchanges for a long time but I would say that everything happens in seconds, maybe you had access on your coins at exchanges while you were replying to this thread but once you submitted the post, exchange got hacked and coins were lost, everything happens in seconds, otherwise loss wouldn't occur.

It is an often reminder to all of newbie and even onto intermediate/expert traders that you must only trade and/or engage in trading if the money or capital you would spend in it would not be all of your money or the money that you cannot afford to lose. Every time that someone asks me where to trade, how to trade, etc., I often tell them that they should only trade if they could take the risk of losing their money. With that being said, there's no real fine line that one must trust any wallets nor any exchanges at all. Even I myself still holds money on some exchanges, not to the fact that I trust those exchanges and their system, but for a reason that I already set myself and my mindset that whatever happens, it would be fine to lose those money.

Hence, whatever your trust issues with wallets and exchanges are, always keep in mind that engaging/trading with crypto remains to be a huge risk to take. Yet, it would always depend on how much risk you can take and if you are willing to take a leap of faith.

sunsilk

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P2P is the other option if you don't want to trade on exchanges but it's not always you'll have that convenient trade through that type of trading. We can use exchanges and basically you will have to if you want to trade bitcoin and convert it to another crypto that you may want to hold. But just as everyone is saying, it's just about not keeping all of them there.

You have to understand the risk that it has upon using a centralized exchange but if you have plans of trading, there's always that huge liquidity on those exchanges that you have to choose. But if it's just holding, I agree that don't use them until you plan to sell.

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Quote from: Yogee on February 07, 2021, 12:44:12 AM

Atomic swaps are becoming more popular and we may see greater volume soon on these exchanges with all the crypto regulations forced on centralized exchanges.

While atomic swap let you have control over your coin, it's not viable option for trader who aim for small profit due to fee of on-chain transaction.

It has to depend on the coin pairs. BTC has the most expensive transaction fee from the coins supported by xlitewallet. The fees for the other coins are cheaper and should be manageable for any trader.

Quote from: shield132 on February 08, 2021, 01:18:38 PM

.....
Yogee
Atomic swap sounds well, I'll have a look at it, thanks.

You're welcome. Do give us a feedback.

notblox1

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You can use exchanges for trading but don't trust them for holding and keeping all your coins, and if you want to accept that risk than don't complain later.
There are some decentralized exchanges allowing you to have your own keys and still trade so you have some compromise, more security and lower volume.
I am sure there will be some better and groundbreaking dex solutions in future but we can use what we have for now.

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Quote from: KaratX on February 08, 2021, 09:44:02 AM

Web wallets are a big No for me, not your keys not your coins , it's as simple as that, the reason why people could warn you not to trust exchanges is never to leave your assets on them, hacks isn't going to warn you when coming, it can happen at anything so they are right, trade on top exchanges and move your funds back into your wallet

But that's a bit of a hassle if you'd ask me since moving from exchange to your cold storage will require some fee and especially this time when the transaction fees are quite high. I might want the idea of not putting everything on a single exchange, meaning you put something on an exchange for trading purposes only and if done, send the profit to your cold storage then repeat what's left on the exchange you are trading. How would you handle yours?

Topic: Don't trust web wallets, don't trust exchanges, then where to trade? (Read 388 times)