Newbie Reminder: Treat Exchanges as Marketplaces

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Quote from: Davidvictorson on November 11, 2022, 05:06:06 AM

Dear newbies, please treat exchanges, such as Binance, KuCoin, Kraken, Huobi, OKX, and Coinbase, as marketplaces. What do I mean? Just as you do not leave your goods on the market after you have paid for them, you take them home with you. Consider your coins as the goods you bought at the marketplace. Your bitcoins should only be stored in cold storage wallets after purchase, and transferred out when you want to sell them. It takes less than 10 minutes. Remember, if you don't have the keys, it's not your coins.

This advice is seemingly one of the useful ones here in this forum. To be honest, I somehow feel guilty about this given that I have been in this forum for five (5) years now. Majority of my BTCs are inside my local exchange and the reason on why I do not transfer them to a hardware wallet is the convenience that the former provides in converting my BTCs to cash whenever I need it.

I guess that maybe, this is the sign that I have been looking for. Newbies, follow this advice and avoid the problems that most have already encountered. If you have invested a hefty amount of BTCs (bought them at exchanges), then move it as soon as possible to a hardware wallet.

Piesel

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The Golden rule is never leave your coins on an exchange and truly exchanges are just a marketplace and not a storage unit, your Bitcoin is best in your personal wallet, and if the exchange wants to be more effective.

They should focus on providing the link between two traders and not holding their coins, there should be a way that any transactions that will be carried out on the exchange, should drop directly into the trader's wallet and not the exchange wallet.

But not all exchanges have such features unless the Dapp which have a wallet connect feature that allows an external wallet connection feature, until your coins are in your wallet with private keys, you did not own the coins the exchange does.

So do well to move out your Bitcoins and any other assets out of the exchange, because there are safe there.

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Quote from: Davidvictorson on November 11, 2022, 05:06:06 AM

Dear newbies, please treat exchanges, such as Binance, KuCoin, Kraken, Huobi, OKX, and Coinbase, as marketplaces. What do I mean? Just as you do not leave your goods on the market after you have paid for them, you take them home with you. Consider your coins as the goods you bought at the marketplace. Your bitcoins should only be stored in cold storage wallets after purchase, and transferred out when you want to sell them. It takes less than 10 minutes. Remember, if you don't have the keys, it's not your coins.

This is a very good advise especially when compared to this market conditions and the bad News of LUNA and FTX crash, our personal wallets are our homes that we can control what we have, but when we live them in the market, if we lose anything among them we have no one to blame bacause we carelessly live them exposed.
Is it only Bitcoin that can be stored in personal wallets like Electron or it dose support many coins?

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Quote from: Magic-Money on November 21, 2022, 11:27:06 AM

That is a very good one, while having a mindset for long run investment, as newbie buy and transfer to your cold wallet is a very good idea and it will make know difference network to save your cryptocurrency asset.

It's nice to transfer your coin to non custodial wallet address, but everyone should also learn how to protect their wallet address and also secure your private key, when you lose access to your private key then you also lose access to your wallet and when your private key have been exposed to scammer then the scammer can easily transfer all your coin without you knowing, so we should always protect our private key and we should always make sure we store it in a place that's not connected to the internet.

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Quote from: slackovic on November 11, 2022, 05:26:01 AM

I understand that Ethereum fees are still too high to use Uniswap for a daily trading but there are bunch of L2 solutions that users can trade one with very little gas fee.

I don't like using any ETH commission based Dexs because of that killer in gas fees. Yes, I admit that fees have drastically gone down but it's not like what we've in other chains, especially BSC or even Polygon.

Quote

And then there is leverage trading. Before it wasn't that easy to do leverage trading on a decentralized exchanges but lately there is an increased popularity in DEXes where users can do leverage trading.

What you shared here is an eye-opener, even to me. Things like this exposition you've here are supposed to be with examples and links to Dexs that offer that. If you don't mind could you share names and links?

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Quote from: Hyphen(-) on November 19, 2022, 02:44:27 PM

Yes, it will reduce risk because there will be backup if the funds are split across multiple exchanges because two or more exchanges cannot have problems at the same time.
There is too much risk in every investment, but cryptocurrency investment has the highest risk in my opinion, as it can simply move someone from grace to grass.

Has the highest risk, but also provides greater returns than other investments. So commensurate with the big risk that will be accepted.
But as smart investors, we must also prioritize the safety of the investments we make. Minimizing every risk will be very useful in various ways that can be done, such as splitting on several exchanges. Monitoring updates from each exchange can also be done to find out the latest developments so that if there is an emergency you can rush to take the actions that need to be taken.

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That is a very good one, while having a mindset for long run investment, as newbie buy and transfer to your cold wallet is a very good idea and it will make know difference network to save your cryptocurrency asset.

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Quote from: Hyphen(-) on November 19, 2022, 02:44:27 PM

Quote from: Zaguru12 on November 11, 2022, 10:33:28 AM

Yeah it's a challenge for daily traders. I had suggested before that it will be better to split them into two or more exchanges depending on on the traders fund. At least its rare to have all exchanges having issues at the same time. Then monthly some of the funds can be moved to wallets. This could minimise the risk.

Yes, it will reduce risk because there will be backup if the funds are split across multiple exchanges because two or more exchanges cannot have problems at the same time.
There is too much risk in every investment, but cryptocurrency investment has the highest risk in my opinion, as it can simply move someone from grace to grass.

My circle of friends were using different exchanges back then because we continuously looked for new coins before they were listed in the bigger exchanges. Today, we have many options to buy promising new coins. The birth of PancakeSwap, Uniswap, Dodo and many more changed it, smaller exchanges are not needed anymore. Therefore it is decentralized exchanges for the new coins but the focus on regular trading is in the big exchanges.

It is easier to trade using centralized exchanges than decentralized exchanges. The trading features alone are of great use for regular traders. But for non regular traders, never leave your bitcoins in exchanges. If the second biggest exchange FTX gets wiped out in a matter of days, leading exchange Binance can fell too. There is no vulnerable exchange particularly in the volatile crypto market.

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Quote from: Zaguru12 on November 11, 2022, 10:33:28 AM

Yeah it's a challenge for daily traders. I had suggested before that it will be better to split them into two or more exchanges depending on on the traders fund. At least its rare to have all exchanges having issues at the same time. Then monthly some of the funds can be moved to wallets. This could minimise the risk.

Yes, it will reduce risk because there will be backup if the funds are split across multiple exchanges because two or more exchanges cannot have problems at the same time.
There is too much risk in every investment, but cryptocurrency investment has the highest risk in my opinion, as it can simply move someone from grace to grass.

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Quote from: Davidvictorson on November 11, 2022, 05:06:06 AM

Dear newbies, please treat exchanges, such as Binance, KuCoin, Kraken, Huobi, OKX, and Coinbase, as marketplaces. What do I mean? Just as you do not leave your goods on the market after you have paid for them, you take them home with you. Consider your coins as the goods you bought at the marketplace. Your bitcoins should only be stored in cold storage wallets after purchase, and transferred out when you want to sell them. It takes less than 10 minutes. Remember, if you don't have the keys, it's not your coins.

This statement is as brief, clear, and direct as it should be. The information being conveyed here is simple enough for even the most laypeople to understand. Even if after all of this, someone from this forum still becomes a victim, their negligence is to blame and there is no other explanation or justification for it. NOT YOUR KEYS, NOT YOUR COINS.

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Quote from: BIT-BENDER on November 11, 2022, 03:06:23 PM

OP is this post only about Bitcoin? Well in my own opinion it shouldn't come to think of it many Newbies but more altcoins that bitcoin.

I think so, Op has mentioned Bitcoin specifically on the topic.
The exchange is not completely a safe place to store assets, we only have a password to enter the exchange but do not have a key to keep it safe. Op made this topic because there are several exchanges that have been successfully hacked, exchange hacks have occurred many times which makes our assets not completely safe there.

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Quote from: Davidvictorson on November 11, 2022, 05:06:06 AM

Dear newbies, please treat exchanges, such as Binance, KuCoin, Kraken, Huobi, OKX, and Coinbase, as marketplaces. What do I mean? Just as you do not leave your goods on the market after you have paid for them, you take them home with you. Consider your coins as the goods you bought at the marketplace. Your bitcoins should only be stored in cold storage wallets after purchase, and transferred out when you want to sell them. It takes less than 10 minutes. Remember, if you don't have the keys, it's not your coins.

This is an important update for everyone it just newbies might not really understand what this means. Some persons do find it easy to keep coins on an exchange due to so many reasons which include easy to sell, Less swapping fee, staking, mining and some many others. It is obviously not advised for us to keep our coin on an exchange but sometimes we are always tempted to do that when we can bear the risk if anything happens to our coin. Some exchanges just careless and do not care about what we might lose if their platform get sticker or hacked.

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Quote from: Davidvictorson on November 11, 2022, 05:06:06 AM

Your bitcoins should only be stored in cold storage wallets after purchase, and transferred out when you want to sell them. It takes less than 10 minutes. Remember, if you don't have the keys, it's not your coins.

Additionally with these you can buy trusted cold wallets with the Trezor and Ledger

Code:

https://www.ledger.com/
https://trezor.io/

And also check the supported coin because in different storage only limited support with the coin you want to, also for their trusted resellers world wide you can check here

Code:

[1]https://trezor.io/resellers
[2]https://www.ledger.com/reseller

I'm not partnered or a reseller just shares this information for the benefit of the newbies. Also if you don't have a budget yet ideal to use a hot wallet such as the following.

Code:

https://electrum.org/#home
https://www.exodus.com/

Issa56

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Quote from: Davidvictorson on November 11, 2022, 05:06:06 AM

Dear newbies, please treat exchanges, such as Binance, KuCoin, Kraken, Huobi, OKX, and Coinbase, as marketplaces. What do I mean? Just as you do not leave your goods on the market after you have paid for them, you take them home with you. Consider your coins as the goods you bought at the marketplace.

Most people think exchange is their house and not a market, they believe is a place where your funds can be secure, but they don't know its kind of risky leaving coins on exchange, some people always say they prefer leaving coins on exchange because it can easily be traded whenever they want and they don't have to be transferring coins from wallet to exchange, some people always say they prefer leaving their coin exchange because they can easily reset their passwords even if they forget it, but if private key is lost, then you won't be able to access your funds again.
But I noticed that most of those people giving reasons why they prefer leaving coin on exchange have not experienced any crypto hack before, they won't have being giving all those reasons, most of them have not lost money in any exchange hack before. Immediately after buying a coin we should always make sure we transfer it to our non custodial wallet address to have rest of mind, no exchange is to big to be hacked or compromised, we all have to be very careful.

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Quote from: Davidvictorson on November 11, 2022, 05:06:06 AM

Dear newbies, please treat exchanges, such as Binance, KuCoin, Kraken, Huobi, OKX, and Coinbase, as marketplaces. What do I mean? Just as you do not leave your goods on the market after you have paid for them, you take them home with you. Consider your coins as the goods you bought at the marketplace. Your bitcoins should only be stored in cold storage wallets after purchase, and transferred out when you want to sell them. It takes less than 10 minutes. Remember, if you don't have the keys, it's not your coins.

Good example. But in the market there is consumer buyers who buy in one's and go home with the goods. How about larger buyers who buyer in bulk and resell. They buy so large that they cannot take their goods home every evening and return them every morning. They don't have any other options than to build shops inside the market where they save the goods they buy and resell to people.
So, you don't blame them when their is fire outbreak in the market which will eventually burn down their goods

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Leaving your funds in exchange means you are giving them access to do whatever they want with your funds. Newbies should take note of this in other for you to learn better in this community, a word is enough for a wise. If you can't sleep in the market place them why will you live your asset in the market place.

This is how scam issues are been discussed here and the best advice on how to be safe is given here but some persons will find it difficult to listen on simple safety tips on their investment and will finally regret their ignorance. Your electrum wallet is your coins, FTX hack is not the first and will not be the last save all your coins in your custody not in the hands of centralized system.

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That is the good suggestion ever. Like we see what the FTX done. And after some days there can be more exchanges so this is a good suggestion that keep out you all assets from all exchanges and don't store them in any exchange.

Exchanges can scam anytime like FTX. So be careful.

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Quote from: Welsh on November 12, 2022, 06:30:47 AM

Electrum can be used as a cold wallet, however by default or the most common usage it's not. If you ran Electrum in a offline environment, it would be considered cold storage, but even then you have to handle the downloading of Electrum, and the transfer to a offline computer, very carefully.

Also, it could technically still be stolen or compromised. There's always a physical threat, and it entirely depends on how you've secured it. Plus, there's no such thing as absolute security, there's always going to be flaws whether that's through the user or the software itself. You can only reasonably secure something, since you aren't going to know all the flaws until they're discovered, and there's been many in the past.

I like this kind of security practice with electrum, but let's be honest that if we have more than $10K in funds then it would be better to consider hardware wallets as a better security option.

Although in the end every bitcoin user is responsible for fund and himself, but as a community, we will probably advise them in the right and simple way. A hardware wallet would be very cheap compared to the risk of losing all the assets on the exchange, this is certainly a worthwhile thought.

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Quote from: Pandu Geddon on November 11, 2022, 06:03:36 PM

Putting assets on an exchange is very risky. what happened to FTX certainly teaches us a lesson. we have no control over our assets. everything is owned by a third party. so it's better now we get used to storing assets in our wallets. if can't have a hardware wallet, an online wallet like Trustwallet is fine for a while too.

Trustwallet or Coinomi as a wallet that can be multicoin compared to storing assets on this exchange is more risky after seeing the impact of FTX which has become a new trend due to failure which eventually led to bankruptcy.
In fact, we are planning a long term investment, so just buy this hardware wallet, you have to sacrifice a little money to buy the wallet. For me, this is important and even if you don't want it, the wallet mentioned above is still worth it as long as your private key is responsible for yourself and not can store arbitrarily.
I myself believe more in hardware wallets and Electrum being a bitcoin wallet that is comfortable to use.

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A good discription and explanation on how exchanges should be treated. There is no business keeping coins that are not meant for trading on exchanges. Hackers are on the hunt and many more Centralized exchange are on the pipeline to getting hacked. we can't trust a system where their database is controlled from a central point and can stop their customers from making withdrawals. Buy from exchanges and move them immediately to cold wallets where worries of compromise is reduced to its minimal.

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Quote from: CryptoHeadlineNews on November 11, 2022, 07:22:48 AM

Advantage of having your BTC in a cold wallet
1. You have total control over your funds
2. It can't be stolen or hacked

Example of a cold wallet Is Electrum wallet

Electrum can be used as a cold wallet, however by default or the most common usage it's not. If you ran Electrum in a offline environment, it would be considered cold storage, but even then you have to handle the downloading of Electrum, and the transfer to a offline computer, very carefully.

Also, it could technically still be stolen or compromised. There's always a physical threat, and it entirely depends on how you've secured it. Plus, there's no such thing as absolute security, there's always going to be flaws whether that's through the user or the software itself. You can only reasonably secure something, since you aren't going to know all the flaws until they're discovered, and there's been many in the past.

Quote from: Pmalek on November 12, 2022, 03:49:25 AM

Some don't consider hardware wallets as cold wallets. Then again, they don't consider them as hot wallets either. They are somewhere in the middle. Unless airgapped, they rely on an internet connection for normal functioning, but some are equipped with chips that provide a safe enclosure for your keys and sensitive information.

Technically, they aren't cold wallets. They're pretty much more secure hot wallets in my opinion. Even then, hardware wallets are usually susceptible to some nifty physical attacks. So, again they aren't absolutely secure. However, they're probably my recommendation to new users that new their wallet to be connected to the internet.

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Quote from: Zilon on November 12, 2022, 05:25:03 AM

Just like we warn investors about risking what the can afford to lose the same goes to day traders on centralised exchanges leaving the amount that is worth losing on a single exchange.

Very few people can absorb advice, warning and practice good preventive activities. They usually skip warnings and try to learn from their experience but unfortunately learning cost by themselves is not small.

Quote

Day trading has never given passive income since it's origin so why risk so heavily, it is of no use waiting to move funds monthly it can be done as soon as a certain target is achieved or at the end of every trade depending on the account size.

Storing your coin on centralized exchanges too long is very bad and FTX is an example. If you trade daily, you have to store your coins on exchanges and it is a beginning of nightmare.

People are more favorite to use centralized exchanges than decentralized exchanges because they want to have higher trading volume, less margin of price changes (don't like high slippage on decentralized exchanges), lower trading fees (don't have to spend fee for each trading transactions by swaps). At the end, they take high risk with centralized exchanges.

Last but not least, trading daily is very difficult to get profit.

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Quote from: Zaguru12 on November 11, 2022, 10:33:28 AM

Quote from: Findingnemo on November 11, 2022, 08:30:17 AM

Day traders can't really afford to move their funds to their wallet everyday but its possible to follow by other kind of traders.

Yeah it's a challenge for daily traders. I had suggested before that it will be better to split them into two or more exchanges depending on on the traders fund. At least its rare to have all exchanges having issues at the same time. Then monthly some of the funds can be moved to wallets. This could minimise the risk.

Just like we warn investors about risking what the can afford to lose the same goes to day traders on centralised exchanges leaving the amount that is worth losing on a single exchange. Day trading has never given passive income since it's origin so why risk so heavily, it is of no use waiting to move funds monthly it can be done as soon as a certain target is achieved or at the end of every trade depending on the account size.

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Quote from: Davidvictorson on November 11, 2022, 05:06:06 AM

Dear newbies, please treat exchanges, such as Binance, KuCoin, Kraken, Huobi, OKX, and Coinbase, as marketplaces.

That also means you should select the exchange with lowest withdrawal rates. Check that before using them!
See for instance WithdrawalFees.com.

Some exchanges (Binance for instance) try to trick you into withdrawing FAKE Bitcoins (on their own made-up (centralized) chain). They now have about 5 different withdrawal options, while only one of them is Bitcoin. DO NOT fall for this, or you won't have the keys to your Bitcoins.

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Absolutely correct.
Most time its only when i want to sell to local currency i would deposit or whenever the market seems to be waving, i might immediately deposit to sell to a stablecoin in other to save my investment from losing value this is because i don't tend to hold for long terms after which i withdraw back to storing wallet. Those who had it in mind to hold for long term should go for cold wallet where they have full control of their assets.

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Quote from: CryptoHeadlineNews on November 11, 2022, 07:22:48 AM

Example of a cold wallet Is Electrum wallet

Electrum is not synonymous for cold wallet, but the software can be used both as a cold or a hot storage solution. It's never a cold wallet if used on an everyday computer that is connected to the internet. But it works on an airgapped and cleanly formatted system that can't connect to the internet any longer.

Quote from: Dunamisx on November 11, 2022, 02:26:55 PM

I also believe that the current events with exchanges will be a lesson and same way sound a warning to everyone using centralized exchanges to take oft their life earnings and assets off from them in other not to be a victim just as in the case of FTX.

FTX wasn't the first exchange that created major drama for its users and it will certainly not be the last one. People didn't learn before, and I don't think they will learn now. There are plenty of folks going: I am so glad I kept my coins on KuCoin, Binance, etc., and not on FTX. And that's the problem. If it doesn't affect them personally, they don't consider it too big of an issue and see no reason to change their behavior.

Quote from: Igebotz on November 11, 2022, 04:37:06 PM

these are some example of complete cold hardware wallets; Ledger Nano X. Trezor One. SafePal S1 etc.

Some don't consider hardware wallets as cold wallets. Then again, they don't consider them as hot wallets either. They are somewhere in the middle. Unless airgapped, they rely on an internet connection for normal functioning, but some are equipped with chips that provide a safe enclosure for your keys and sensitive information.

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I hope newbies and trader will start believing DeFi more after all the shady mismanagement of funds that FTX got itself into, this is never going to be erased from crypto history ever.

Now FTX scandal is going to join the likes of Bitconnect, Onecoin and Luna.

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Great comparison; it would be great to explain to beginners all the other points in such a simple way. But people have a short memory, and very quickly the drama that happened with FTX will go down in history. In the next topic, we saw agitation for the storage of funds on the exchange and a strong belief that the exchanges are obliged to return losses. This suggests that no matter how simple the language we try to use to explain the dangers of holding funds on exchanges, there will always be people who read vertically.

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Putting assets on an exchange is very risky. what happened to FTX certainly teaches us a lesson. we have no control over our assets. everything is owned by a third party. so it's better now we get used to storing assets in our wallets. if can't have a hardware wallet, an online wallet like Trustwallet is fine for a while too.

Quote from: Igebotz on November 11, 2022, 04:37:06 PM

SafePal S1 etc.

The safepal S1 hardware wallet is also not used to store our assets there. the hardware used will direct us to the online wallet on the smartphone to access it. not much different from Trustwallet. the hardware is only used as a validator when making outgoing transactions. so it will be safer when we put our assets there.

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Quote from: Findingnemo on November 11, 2022, 08:30:17 AM

Day traders can't really afford to move their funds to their wallet everyday but its possible to follow by other kind of traders.

Somehow I get your point, obviously because the transaction fees that exchanges charge when withdrawing their funds will affect day traders decisions.

I'm not sure newbie with a low investment value would be willing to withdraw their funds from the exchange just because of the OP's suggestion. In fact, binance convinces its users with SAFU ^{[even if that's not a good reason]} so many of their customers believe that their funds are safe. I trust in a certain amount on exchange, but of course for the amount I can afford to lose. The right choice is as suggested, but certainly not really adopted by all users.

In addition, storing funds in a wallet that is fully controlled by the user is also not completely safe if you do not understand and practice good security. One other smart thought is, don't keep your funds in one basket. But there's nothing wrong about the OP's suggestion, I full support for it.

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Quote from: CryptoHeadlineNews on November 11, 2022, 07:22:48 AM

Example of a cold wallet Is ~~Electrum wallet~~

Gives you access to your keys but Electrum wallet offers hot storage which is still hackable, these are some example of complete cold hardware wallets; Ledger Nano X. Trezor One. SafePal S1 etc.

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Quote from: Davidvictorson on November 11, 2022, 05:06:06 AM

Dear newbies, please treat exchanges, such as Binance, KuCoin, Kraken, Huobi, OKX, and Coinbase, as marketplaces. What do I mean? Just as you do not leave your goods on the market after you have paid for them, you take them home with you. Consider your coins as the goods you bought at the marketplace. Your bitcoins should only be stored in cold storage wallets after purchase, and transferred out when you want to sell them. It takes less than 10 minutes. Remember, if you don't have the keys, it's not your coins.

With this in mind is it a plausibility that coins kept in wallets can be affected by the bear or bull seasons?
Also, it is quite important to adhere to this cautionary thread in order not to fall victim of manipulations, hack or simple loss due to effect of the exchange seasons.
Your last phrase however, is the most important. 'If you don't have the keys, its not your coins.' I pray to never forget mine as it has happened in previous occasions and be more open and willing to learn, trade and invest as this is a market and I don't know why I would be here if not for making gains.

The Cryptovator

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Yep, well said. This a pretty good example to show the reality. We have never been supported to keep your funds in the exchange ever and day by day it's becoming more transparent. A lot of things happening in the crypto world which have been making this space more worst. We should take the lesson from history. There are a lot of reasons why shouldn't store your crypto in the exchange. It's been never safe and won't be safe ever.

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Quote from: Davidvictorson on November 11, 2022, 05:06:06 AM

Your bitcoins should only be stored in cold storage wallets after purchase, and transferred out when you want to sell them. It takes less than 10 minutes. Remember, if you don't have the keys, it's not your coins.

Deliberately bold the sentence above because it is a truth. Ironically to date nothing will stop people from having their assets in exchanges. They decide whatever they want including save their funds on the exchange.

The last thing is, regret will come too late even if now everything seems safe. There are many exchange hacking incidents, it is the most feared thing but actually it also doesn't prevent people's interest from having funds in exchange. This solution is for those who care about the safety of their funds in the long term so they don't care about the fee incurred to transfer assets to a personal wallet.

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OP is this post only about Bitcoin? Well in my own opinion it shouldn't come to think of it many Newbies but more altcoins that bitcoin.
So regardless of the coin you are buying I also support you do what the OP has said on his post. I think their are some exchange that try to offer users some freebies when they leave their coins on that exchange, it still are dangerous risk that is far more disastrous than any benefits the exchange may want to offer. Exchanges is a literally understandable and take it for what the word stands for and not and a double tasking application that you can also use as a wallet. Open a personal wallet is easy and keeping it safe is easy as well.

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Quote from: Davidvictorson on November 11, 2022, 05:06:06 AM

Your bitcoins should only be stored in cold storage wallets after purchase, and transferred out when you want to sell them. It takes less than 10 minutes. Remember, if you don't have the keys, it's not your coins.

I also believe that the current events with exchanges will be a lesson and same way sound a warning to everyone using centralized exchanges to take oft their life earnings and assets off from them in other not to be a victim just as in the case of FTX , we don't know which other exchange will be the next very soon because we are in the peak of market volatility and this has proof to be one of the means whereby some exchanges were exposed or being casted.

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Quote from: Davidvictorson on November 11, 2022, 05:06:06 AM

Dear newbies, please treat exchanges, such as Binance, KuCoin, Kraken, Huobi, OKX, and Coinbase, as marketplaces. What do I mean? Just as you do not leave your goods on the market after you have paid for them, you take them home with you. Consider your coins as the goods you bought at the marketplace. Your bitcoins should only be stored in cold storage wallets after purchase, and transferred out when you want to sell them. It takes less than 10 minutes. Remember, if you don't have the keys, it's not your coins.

This advice has literally been said hundreds of times to beginners or anyone who has deposited their assets on the exchange. I don't think things will change especially many active traders will not care about this advice because they believe that as long as they are still trading then having assets on the exchange will allow them to take advantage of opportunities much quicker.

Your advice is more suitable for investors or for those who have not traded anything on the exchange for a long period of time. So don't equalize traders and investors even though it is true exchange is not a completely safe place for our assets.

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Quote from: Findingnemo on November 11, 2022, 08:30:17 AM

Day traders can't really afford to move their funds to their wallet everyday but its possible to follow by other kind of traders.

Yeah it's a challenge for daily traders. I had suggested before that it will be better to split them into two or more exchanges depending on on the traders fund. At least its rare to have all exchanges having issues at the same time. Then monthly some of the funds can be moved to wallets. This could minimise the risk.

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Quote from: slackovic on November 11, 2022, 05:26:01 AM

I really don't understand why would anyone use a CEX these days. Especially for "normal" spot trading. I understand that Ethereum fees are still too high to use Uniswap for a daily trading but there are bunch of L2 solutions that users can trade one with very little gas fee.

And then there is leverage trading. Before it wasn't that easy to do leverage trading on a decentralized exchanges but lately there is an increased popularity in DEXes where users can do leverage trading.

And additional benefit is that no one is forcing you to do KYC on a decentralized exchange while on some centralized exchanges KYC is mandatory.

Decentralized exchanges are not really user friendly and also lacks trading volume which is the reason why newbies and regular traders trust the centralized exchanges. Ofcourse KYC becomes mandatory in almost all the exchange but with the coming years it is not avoidable so people get used to that since they are making money from it.

Day traders can't really afford to move their funds to their wallet everyday but its possible to follow by other kind of traders.

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Quote from: Davidvictorson on November 11, 2022, 05:06:06 AM

Dear newbies, please treat exchanges, such as Binance, KuCoin, Kraken, Huobi, OKX, and Coinbase, as marketplaces. What do I mean? Just as you do not leave your goods on the market after you have paid for them, you take them home with you. Consider your coins as the goods you bought at the marketplace.

I did not learn this on time, but I was lucky not to learn the lesson the bitter way, that "not your keys, not your coins" sentence that is used many times here made me realize that exchanges cannot be trusted. The recent situation in cryptocurrency is enough for people who have not known this to learn about it now, but I still think some people will not learn and will never learn, even some who learn, may still forget about it when the importance of this is no longer stressed.

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Beginners should be aware that this reminder is important for them not to do exchanges such as houses that store goods in them.

Maybe we used to think that storing on the exchange is a safe place even though Binance is the largest exchange in the world still it doesn't guarantee our assets are safe we should avoid that and change our mindset to keep our assets in non-custodial wallets because private keys are the most important thing to protect our assets.

I have outreached to close friends so they don't keep assets on the exchange, and thankful of them believing that non-custodial wallets give them full control over them so they left the exchange to store assets.

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This is the best advice and explanation so far by the O.P to anyone who is currently into crypto now, as we never can tell when another trusted exchange may go bankrupt after the fall of "FTX" during the week because if only had we treated exchanges as only marketplace to buy coins, while we send to a cold wallet, the effect on the crypto market wouldn't have been that much. However, it's never too late for us to have a u-turn from today, most especially the newbies who are new to bitcoin.

Advantage of having your BTC in a cold wallet
1. You have total control over your funds
2. It can't be stolen or hacked

Example of a cold wallet Is Electrum wallet

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that is very correct. I used to also put some of the assets I own on the exchange. I think it will be very easy when I want to sell it and don't need to transfer again. and immediately make withdrawals when I need fiat. ah, it turns out I did something wrong for quite a while. and of course, it turns out to have a very big risk.
now I only move assets from my wallet when I need fiat or do day trading. sometimes still forget to withdraw and leave it on the exchange.

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Treat it as a car, once you buy the car you don't typically leave it on the forecourt. You drive it off. Unfortunately, until we introduce a community standard, and start boycotting exchanges which have wallets, this probably isn't going to change.

I'm of the opinion that any exchange advertising their wallet services is shady in the first place. It's encouraging bad practices. Instead, wallets shouldn't exist. Instead, pay for your Bitcoin, but input an external address at the time of purchase, so that it's impossible to keep Bitcoin on the exchange.

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Quote from: Davidvictorson on November 11, 2022, 05:06:06 AM

Dear newbies, please treat exchanges, such as Binance, KuCoin, Kraken, Huobi, OKX, and Coinbase, as marketplaces. What do I mean? Just as you do not leave your goods on the market after you have paid for them, you take them home with you. Consider your coins as the goods you bought at the marketplace. Your bitcoins should only be stored in cold storage wallets after purchase, and transferred out when you want to sell them. It takes less than 10 minutes. Remember, if you don't have the keys, it's not your coins.

This is a good suggestion. But what if a guy always trade big bulks of tokens and stablecoins? He should pass the level or the minimum withdrawal he can only do and stick to that everyday. (Im talking about a lot of money or whales). Also possibly that liqudity on dex might not be enough. Usually big pool or the market is on cex due to trading volume. But what you said is right, as much as possible keep on non custodial wallet.

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Quote from: mk4 on November 11, 2022, 05:11:30 AM

Seriously, most exchanges today have great looking UIs that it gives the impression that there's nothing that can go wrong with the platform.

Exactly, but they can be hacked. Manynkf their coins are on hot wallets, they are handling customers coins and large in number, the reasons hackers do more work for haxk exchanges.

Hackers will find it more difficult or more impossible to hack if they use cold wallets.

The best is to just setup a cold storage. If you want it to be online, multisig will be perfect. Combining multisig on cold storage or hardware wallet are most perfect.

Noncustodial wallet gives full control.

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I really don't understand why would anyone use a CEX these days. Especially for "normal" spot trading. I understand that Ethereum fees are still too high to use Uniswap for a daily trading but there are bunch of L2 solutions that users can trade one with very little gas fee.

And then there is leverage trading. Before it wasn't that easy to do leverage trading on a decentralized exchanges but lately there is an increased popularity in DEXes where users can do leverage trading.

And additional benefit is that no one is forcing you to do KYC on a decentralized exchange while on some centralized exchanges KYC is mandatory.

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Quite a good analogy. The same reason how you immediately get your money on money remittance centers and not leave them there unnecessarily just because you're lazy.

Seriously, most exchanges today have great looking UIs that it gives the impression that there's nothing that can go wrong with the platform.

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Dear newbies, please treat exchanges, such as Binance, KuCoin, Kraken, Huobi, OKX, and Coinbase, as marketplaces. What do I mean? Just as you do not leave your goods on the market after you have paid for them, you take them home with you. Consider your coins as the goods you bought at the marketplace. Your bitcoins should only be stored in cold storage wallets after purchase, and transferred out when you want to sell them. It takes less than 10 minutes. Remember, if you don't have the keys, it's not your coins.

Topic: Newbie Reminder: Treat Exchanges as Marketplaces (Read 531 times)