Topic: What to avoid to not lose cryptocurrencies on exchanges (Read 320 times)

Exchangers act as custodians (mostly)  where they don't share the seed key to their users.  Whereas if you choose to keep your Privatekey yourself, that means you must to have a private wallet (non custodian wallet) to store your own cryptocurrency. You can choose your favorite wallet here: Top 10 Best Cryptocurrency Wallets
Please note that you are fully responsible for your assets as well as your private key / seed key in case of loss when you use a non custodian wallet. To avoid losing cryptocurrency assets on an exchange or personal wallet, first make sure your computer is safe from dangerous viruses, and maybe some of the links below can help improve the content of this thread

- Ways to prevent Cryptojacking ,hacking etc.
- Prevent your Electrum wallet Hack - Guide

You have confused your point here on security to coins. But whichever exchange we want to keep our coins and whether big or small, keeping our coins to our own wallet is more secured because we have access to the private security and no one else.

It's simple, just don't leave your crypto coins on any exchanges either top or low exchanges cos anything can happen at any time and not all exchanges will be able to do some refunding, here is why top exchanges are a bit better because they have better security and if hacks do happens they can do reimbursement easily

The important thing that you need to do not to lose your coins is sending to the other wallet so you will have a full control over all of your coins.
You can keep your coin in the exchange, but you must remember that we should select the exchange which having a good security.
But still, I prefer to save the coin at my wallet, and having a hardware wallet will be recommended.
The relation between the title and the thread is saving the private keys into the safe places and only us that will know the wallet.

I agree. I've read the entire post but I'm still not sure I've found the answer to the question from the title.
I may be wrong, but this seems to be a paraphrased text from another source without being properly attributed to the original author.

Your title and the way you selected subtitles is quite confusing. The subtitles say nothing about what to avoid in order not to lose cryptocurrencies on exchanges.

One of the most important one is to probably avoid using exchanges as wallets. People should avoid keeping their coins in exchanges for long term as they can get hacked or get closed down at any time. The risk can further be reduced by using only popular and established exchanges to trade on and avoid brand-new platforms with no reputation that are likely to exit-scam.

This is not only happening with erc20 and BSC tokens, even BCH is confusing the people with the same address format of bitcoin so the users are having the complete responsibility of spending/sending their coins and tokens to the right address. Always double or triple check the coin and address when you are using the exchange and don't forget to check if there is any warning sign while making transactions.

Having noncustodial wallets can be helpful on certain cases but most of the time the funds will be send to the wrong destination in case of exchanges so you can never recover anything from it.

Yes exactly. There is also a converter that can convert 3-litecoin addresses to M-litecoin addresses.

It is also much more very dangerous now. There will not be problem while using noncustodial wallets because you can use the ethereum private key to recover back the token if imported on supported wallet, or the wallet will support the token. But for exchanges, there are times the token send is completely gone if customer care do not help. An example is the latest smart contract like Binance smart chain that also have the same address with ethereum, while some exchanges are not supporting binance smart chain, this makes some people think they can send the token on BSC to ERC20 address because they are the same addresses. Some exchanges that do not yet support BSC will lead to the coin lost if sent because they support the token with ERC20 but not support the token with BSC while they have the same addresses with ethereum.

Shitcoins such as Ethereum were created long after the first pioneer altcoins were created such as Litecoin.


The fact that problems such as the ones you explained exist (sending to wrong address) is mainly due to lack of innovation and lazy developers copying other people's code. For example LTC copying bitcoin and not changing that much led to its addresses being the same and people being in some trouble by sending to wrong addresses.
The problem with tokens isn't serious though because the address is supposed to be the same.

Yes. it does require a lot of practice that is why a user has to remind himself that ERC20 tokens can only be sent to ETH address.  TRC20 can only be received by TRX addresses and the recipient should also be reminded whether he has the private key of his address in case his wallet doesn't support the token that will be sent.
This happens a lot that a user will send ERC20 token to an ETH exchange wallet and then it's gone for the exchange didn't support the token. 

Should we add the mental focus of the trader? when transferring funds, and how he makes transactions, the reason why you lose funds in the number of the exchange one is carelessness, how you think, because you are thinking so many things you might paste a wrong address, and send it, and later find out you made a mistake, maybe because your thinking so many things at the same time.

Bitcoin transactions are irreversible. Details in Bitcoin Wiki

Not correct. Ethereum and ERC-20 tokens have same address and you only need a wallet that supports ERC-20 tokens. If you have mnemonic seeds, you can import it and get your ERC-20 tokens.

People lost their ERC-20 tokens if they send them to exchanges that not support those tokens. Those tokens exist in those wallets but without seeds, they can not get it.

Similar to your previous opinion. Don't move fund cross chains and read the guides of exchanges for what they support, what they don't support.

Use non custodial wallets for bitcoin and altcoins. Exchanges don't give you access to private key or mnemonic seeds. Most of exchanges don't support it.

This is not quite accurate. Many altcoins were created before the appearance of Ethereum. I can name Namecoin and Litecoin as counterexamoles, they were created in 2011 (4 years before Ethereum).

This is, most likely, the main reason why Litecoin changed the format of its addresses. Most litecoin wallets will generate addresses that start with M instead of 3 to avoid any confusion.

Actually I have sent Fait to a wrong account because of low attention, a very simple negligence, loses are in Fiat, and who loses in Fiat easily, still loses even if the person goes crypto-currency, tighten avenue to lose money, this is a global guidance no matter what you are interested in, based-on Finance

There are quite a lot of ways users can lose funds in crypto, not just via exchanges, in my honest opinion I'd say ones own folly is the only way to actually lose your crypto funds, cause looking closely at every case of lost funds, you find out that the victim made one mistake or the other and without that flaw then that loss will not be possible, the loss always emanates from the victims themselves.

Of course having your private keys in your custody is pertinent, and the fault of people losing funds isn't with the exchanges cause that's their policy/how they operate (with a web wallet), it's up to the users to value their funds and not use them to store a significant amount of their cryptocurrency, failure to do so will sometimes cause losses through hacks and the rest, and even if the third party service will take part in the blame, it's your funds that's lost.

You need to read the article very well, checking the address and sending to right address only applies to some cases. What about sending USDC to USDT address on an exchange that support USDT but do not support USDC? If the amount is not high enough, all what the customer care will message the person is that it is not possible to recovery the coin, that it does not meet the requirements needed. Do you know that ERC20 USDT and USDC have the same address which is ethereum address, but because USDC is not supported by the exchange is the reason for the loss, but I'm this can not happen of you have the ethereum private key.

Also check this:

You might think nobody has ever lost fiat. The absent-minded person will always lose something.
It is necessary to double-check everything several times before sending money to any address.

After bitcoin was created
In the past time when bitcoin was created, bitcoin users were later using addresses to make payment, but some people can make mistake at the time sending bitcoin to a wrong address, the bitcoin sent to a wrong address can not be recovered. Bitcoiners have known this and they know to be careful to send bitcoin to the right address. But the creation of altcoins makes losses a usual occurrence in the crypto community.

After altcoins were created
Altcoins was created while ethereum was the first altcoin ever created, later followed were thousands of cryptocurrencies created. When some altcoins were created, they have their own blockchain, this makes error not to be much, anyone that can send to wrong address at the time can be blamed. But there are few errors, like the litecoin addresses that started with 3, some people can mistake it for a bitcoin address and send bitcoin to litecoin address, or send litecoin to bitcoin address, this is one of the ways some people lost bitcoin and litecoin in the past, but people using wallet that has private key can still recover back the coin.

Token creation
Tokens are altcoins that do not have blockchain independently, I am not going deeper into this, I will use ethereum blockchain to explain. There are many ERC20 tokens that make use of ethereum blockchain. Examples are Tether, USDC and thousands of cryptocurrencies like that. What makes this not perfect is that all the thousands of ERC20 tokens have a similar address like ethereum address, this makes some people send token to a wrong address, like sending Tether to USDC address on an exchange that do not support USDC, some can be recovered with the help of the exchanges customer care but most were lost.

The smart contract
The altcoins are getting more complex and complicated for users with the introduction of some particular smart contract like the binance smartchain. Binance smartchain (BSC) addresses are the same as ERC20 tokens addreses, while some people will confuse it with Binance chain addresses (addresses that start with bnb), this has caused great losses for users. See the illustration below as a good example.

Exchange A support Coin A
Exchange B support Coin A
Coin A support ERC20 and BSC on Exchange A
Coin A support ERC20 but do not support BSC (Binance smart chain) on Exchange B

Because BSC addresses are like ERC20 addresses, if the sender send Coin A (BSC type) into an exchange (exchange B) that do not support BSC but support ERC20 for the coin, this will lead to loses. Only what can make the owner not to lose is to have the private key that can be used to recover the coins. Some exchanges can help too, but if low amount is lost, no help will be rendered.

Private key is very important
All the ways listed above are potential ways people can lost crypto as people are complicating crypto, many people have lost cryptocurrencies because they are making use of exchanges, but if people know about all these, they will avoid losing coins to make sure they do not lose crypto into exchanges, but many people do complain how their tokens are lost this way. Having a private key to your wallet, it can be easily used to recover back such cryptocurrencies.