When you invest in a stock of a company there is a paper trail and your shares are securely held in your demat account. Crypto tokens, on the other hand, are stored in wallets which aren’t overseen by any central regulatory authority. Meaning you alone are responsible for the safety of it.
If your wallet, platform or an exchange is hacked there is no recourse to seek recompense. There are no investors protection funds, unlike capital markets and, hacks are common. So how do I guarantee the safety of my accounts in this case?
If your wallet, platform or an exchange is hacked there is no recourse to seek recompense. There are no investors protection funds, unlike capital markets and, hacks are common. So how do I guarantee the safety of my accounts in this case?
There are two options.
If you have an outdated, insecure computer that you know is full of viruses and you are physically and intellectually incapable of securing your own private keys, then you're probably better off storing the coins on a regulated exchange, such as Unocoin in India's case. Enable 2fa and all that. The risk of your account getting hacked is still there and I can assure you that it's much more risk of losing your money by storing on an exchange than storing on your own wallet.
Otherwise, store it on your own. Download electrum, and set it up. Takes like 1 minute. Or if you're storing a larger amount, use a hardware wallet.
Your funds if hacked will obviously be unrecoverable, but by using a desktop/hardware wallet the chances are close to zero, if you secure your computer well.
