Why is it bad to leave crypto on exchanges? - page 4.

stomachgrowls

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Quote from: Abiky on April 26, 2022, 07:30:08 AM

Quote from: Anonohmon on April 20, 2022, 06:59:27 PM

I have most of mine on an exchange because I'm getting paid interest. Has there ever been a time when an exchange like Binance for example, steals your funds or gets hacked and people lost money?

Yes. Basically any exchange is prone to hacks, theft, and in some cases, fraud. You'd be better off leaving your crypto on "De-Fi" platforms than a centralized exchange just because the risk of loss is simply too high to bear. I don't care if a centralized exchange gives you high interest rates if at the end I'm sacrificing my privacy/anonymity and control over my own money. Decentralization exploits crypto's fullest potential, so it's best to seek alternatives that would put you first above all else. Most people are not that knowledgeable about crypto/Blockchain tech, so they will use what's most convenient for them.

What to do with your money is entirely your decision. As long as you don't invest more than what you can't afford to lose, you'll have nothing to worry about. Just my opinion

Yeah, it is the sweetest spot for hackers considering that this places are involved with millions of dollars which it is really that understandable that they would really be coming after with these amounts

and next would be gambling places or any other platforms or services which does have lots of funds or money that they do generate.If you are an active trader then its true that its less hassle if funds

been leave out into platforms for immediate interaction for possible opportunity that you could see and if you could bare out the risk then go ahead.

darewaller

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We had a million of exchanges that got hacked or exit scammed, we had it at sizes of mt.gox as well so it wouldn't be new thing. However, Binance is making a ton of money and the security of your coins improved a lot during this period, which means that it's very hard for people to actually got it hacked.

Binance would prefer to keep going and make money legit way, because they are already making billions and on top of that we are talking about a company that worths hundreds of billions of dollars. Yes if they somehow "stole" your money that would be more profitable but in the long run they would live a horrible life, why prefer that when you are already making billions?

D ltr

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there is no wrong-flowering platform, and avoid virtual risks, because basically crime is everywhere,
it would be nice if you put your money in a local bank for locking, because even though banks often make losses but there is a guarantee of safe funds when there is a bank robbery etc., in contrast to crypto when the exchange is hacked, it is unlikely that the funds will return. like MK4 said, we must be good at controlling the risks that exist and we will face

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Quote from: Anonohmon on April 20, 2022, 06:59:27 PM

I have most of mine on an exchange because I'm getting paid interest. Has there ever been a time when an exchange like Binance for example, steals your funds or gets hacked and people lost money?

Yes. Basically any exchange is prone to hacks, theft, and in some cases, fraud. You'd be better off leaving your crypto on "De-Fi" platforms than a centralized exchange just because the risk of loss is simply too high to bear. I don't care if a centralized exchange gives you high interest rates if at the end I'm sacrificing my privacy/anonymity and control over my own money. Decentralization exploits crypto's fullest potential, so it's best to seek alternatives that would put you first above all else. Most people are not that knowledgeable about crypto/Blockchain tech, so they will use what's most convenient for them.

What to do with your money is entirely your decision. As long as you don't invest more than what you can't afford to lose, you'll have nothing to worry about. Just my opinion

Vatimins

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Quote from: goldkingcoiner on April 25, 2022, 04:40:54 PM

~

Yup, have heard of these and more. The thing about exchange hacks is that if the funds you kept is big enough, then it would be worth it to chase after it and go through the effort of hiring a lawyer or something. But, if it isn't that much or is all a person has because of earning it online and has no capabilities to hire a good lawyer, the person has no choice but to let go of such funds. Still, it is better when the funds get lost on an exchange. The bigger problem here is when some regulation changes or whatever problem and your funds get frozen, worse case impossible to take out. Of course there are warnings form exchanges when some things get changed. The problem is that not all of the people can check every now and then about crypto. Pretty careless as an investor you may say but has already happened couple of times, even with the people I know personally. So yes, best place is your wallet. As what you have said, "Not your keys, not your coins."

milewilda

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Quote from: Anonohmon on April 20, 2022, 06:59:27 PM

I have most of mine on an exchange because I'm getting paid interest. Has there ever been a time when an exchange like Binance for example, steals your funds or gets hacked and people lost money?

Dont go all in and only put on the amount which you could afford to lose.Im not saying that they cant be trusted considering that you are mentioning about binance but still the risk
on getting hacked or any possible problems could arise since exchange platforms are really prone into these kind of incidents on which you should really be aware or prepared of.
because everything could happen in an instant which means risk would be always there.Therefore, you should really be that paranoid on not to go all in or put all of your
assets parked on a certain platform.

ololajulo

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There was no major exchange hack in the last one year, even in the middle of bull market, which could indicate that exchanges are doin something different. Since 2019, more than 70% of hacked exchanges are still active. Now the wallet that was suppose to be safe is now the target eg metamask wallet. Another factor is to split portfolio on different wallets to reduce the risk.

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Quote from: Vatimins on April 25, 2022, 05:58:21 AM

Being in this industry for years, I am telling you, don't keep majority of your funds in an exchange for too long, or at least spread it out on several exchanges if you are fond of staking and yield farming. Not that it doesn't exist in other platforms but considering that it may be easy for you to do these things on an exchange, I understand. I don't have to tell you the countless number of horror stories of several people all over the years that kept funds on exchanges long term. Just a little googling and you'd see what you are looking for, while the causes and effects for each story may differ from one another, they have one thing in common; the root of the problem is keeping fund in an exchange.

If you have been in this industry for years you will remember Mt. Gox and all the other exchanges that fell prey to hackers and bugs and the such. Of course, due to the semi anonymous nature of most crypto, this money can be traced for you in some cases and in other cases, if you did KYC with the exchange, it can be attributed to you and Mt. Gox has no choice from a legal standing other than to reimburse you.

But this has two problems. You are trusting someone else to hold your money. If something happens you might be stuck waiting years and finding special lawyers to get your money back.

The entire point of crypto is to be the sole person who has access to your money.

Not your keys not your coins.

batang_bitcoin

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Quote from: Amjado711 on April 25, 2022, 04:20:06 PM

If you look into the history of crypto exchanges theres several issues that happened which makes people lose the believe on it

And the funds they've left on exchanges, never been refunded. Or, if it's about to be refunded it has took them a long time of wait before it even moved for the decision to give back to the affected users.
In short, if you don't want to be problematic with it then don't leave it on exchanges or if you do, you're aware of any possibility if unfortunate events happens into the exchange you've left your funds.

Amjado711

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If you look into the history of crypto exchanges theres several issues that happened which makes people lose the believe on it

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Quote from: Henrobakkara on April 25, 2022, 09:44:04 AM

I agree that should be a major pointer there, leaving a large amount of your crypto assets on the exchange is highly risky and with regards to even, if the exchange is trusted or relatively safe, it can still happen. Binance if I recall is amongst the hacked exchanges before so I would only do what I intend to trade.

There is not even a very safe exchange, if there is a case of theft it has been going on for a long time. In fact I think every exchange I've ever known has been hacked. I think with the hack that happened it became a warning. Therefore the exchange will continue to develop in terms of security.
Keeping all the funds in the exchange is certainly a risk, but I think most people do that. Moving their assets repeatedly is too much of a hassle. But fund management as you do will be better, use some of your funds and routinely store in a personal wallet. Although a personal wallet does not guarantee but it is a little more secure.

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Quote from: fzkto on April 25, 2022, 08:32:32 AM

All this talk about not holding cryptocurrency on an exchange ends when you start actively trading it. Of course you shouldn't keep your money with third parties, but you have no other options when you are trading on a daily basis. That's why some people accept all the risks and hold cryptocurrency on exchanges. In that case, you should regularly withdraw part of your profits to a personal non-exchange wallet.

making regular withdrawals of profits on a trading account on an exchange would indeed be better and recommended. If you keep everything on the exchange will be very risky, because we do not have full control on the exchange.
However, the current exchange security is also constantly being upgraded, such as Binance which continues to provide a high level of security to protect its users from hacker attacks etc.

I use a hardware wallet to keep all my crypto assets more secure and make deposits on several exchanges that I want to use for trading. the important thing is to choose the best exchange and have the best features, don't use an exchange that has no clear security and is still relatively new, I can recommend Binance, Kucoin, Huobi, but be careful and alert, no system is forever safe.

Henrobakkara

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Quote from: bitzizzix on April 25, 2022, 09:19:51 AM

As people say, not your keys, not your crypto. It is advised not to leave large amounts of crypto on the exchange and for interest reasons or whatever.
and indeed binance has thrived in protecting crypto accounts and gaining trust, and although Binance is relatively safe but remember it is centralized. So it could be that your crypto could be lost who knows and being careful is important.

I agree that should be a major pointer there, leaving a large amount of your crypto assets on the exchange is highly risky and with regards to even, if the exchange is trusted or relatively safe, it can still happen. Binance if I recall is amongst the hacked exchanges before so I would only do what I intend to trade.

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As people say, not your keys, not your crypto. It is advised not to leave large amounts of crypto on the exchange and for interest reasons or whatever.
and indeed binance has thrived in protecting crypto accounts and gaining trust, and although Binance is relatively safe but remember it is centralized. So it could be that your crypto could be lost who knows and being careful is important.

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So anyway, I applied as a merit source :)

Quote from: Anonohmon on April 20, 2022, 06:59:27 PM

I have most of mine on an exchange because I'm getting paid interest. Has there ever been a time when an exchange like Binance for example, steals your funds or gets hacked and people lost money?

I understand that the interest you are getting is worth the time that you are spending to keep those coins locked up without being able to use them.

There can be two scenarios here,
1. You cannot spend those coins in your country anyway because they are not leninent towards crypto, yet - in this case what you are doing is fine, but be a big diligent to not store all your coins there, but withdraw at least 50% of it.

2. You can spend your coins easily, but you are being lazy and getting stuck in the idea of losing interest payments - in this case pull out 100% of your assets for your good.

You can never know when an exchange will get hacked or freeze your wallet for some reason. While the interest earning schemes are tempting, be careful because in the past every one year we see an exchange happening and you dont want to be a victim of such.

fzkto

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All this talk about not holding cryptocurrency on an exchange ends when you start actively trading it. Of course you shouldn't keep your money with third parties, but you have no other options when you are trading on a daily basis. That's why some people accept all the risks and hold cryptocurrency on exchanges. In that case, you should regularly withdraw part of your profits to a personal non-exchange wallet.

cheezcarls

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Quote from: jackg on April 20, 2022, 07:15:23 PM

Almost all exchanges have been known to freeze accounts due to investigations or other reasons. Most exchanges also deny any liability in case your funds are stolen.

Bitfinex were hacked and took 33% of all users funds back in 2017 (I think) - users were compensated later but btc was what was stolen and users were compensated in the usd value (so all but people holding usd lost out).

A lot of exchanges exit scam too and that's another risk you'll have to bear by storing funds with them long term.

Is it even worth storing funds on an exchange for interest? You might get higher interest by switching to investing the same assets on trusted defi marketplaces (you'll have to do a bit more research and determine whether it's worth the risk but the roi is probably higher). The safest way to store crypto is to hodl it in hardware wallets or cold storage though (with software and hardware being obtained from a trusted source).

Yes these are the major disadvantages if we store our cryptocurrencies into exchanges like Binance, KuCoin, etc. No disrespect, but as long we do not fully control our assets, they have the power to freeze our accounts anytime without warning and not liable for any losses in case the hacker attacks the exchange.

It’s better to invest in a hardware wallet like Ledger Nano S, Trezor and SafePal. Don’t put too much money on Metamask and Trust Wallet too, because they are vulnerable to malware and hacking because of not having a multisig feature like the Lobstr’s vault. It’s one reason why $12k was drained to my 3 wallets combined a few days ago, and I learned my lesson the hard way and I am still trying to move on with that but I am getting there and back to business.

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Everyone will find their own reason why it is not suggested to keep cryptocurrency on exchange, only when they lost them. The level of danger or losses varies from exchange or account being hacked, to exchange charging fees for holding your funds. And the last one is most disgusting's. You leave funds on exchange, one day plan to spend specific amount, but when you return you find less.

Vatimins

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Being in this industry for years, I am telling you, don't keep majority of your funds in an exchange for too long, or at least spread it out on several exchanges if you are fond of staking and yield farming. Not that it doesn't exist in other platforms but considering that it may be easy for you to do these things on an exchange, I understand. I don't have to tell you the countless number of horror stories of several people all over the years that kept funds on exchanges long term. Just a little googling and you'd see what you are looking for, while the causes and effects for each story may differ from one another, they have one thing in common; the root of the problem is keeping fund in an exchange.

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Quote from: BD Crypto on April 24, 2022, 02:48:57 PM

Binance is a centralized exchange and it can freeze your account if they find something fishy in your account. So it's not good to leave crypto on exchanges because they can be hacked/lost or can be locked.

I guess this has been established but also is that there are reasons why people leave their cryptos in exchanges even though not advisable and knowing all the risks involved which mostly involve staking for interest and quick access to trading for traders other than this, I don't see a reason why investors will want to leave their crypto in exchanges no matter how trustworthy but can still easily freeze your assets, be hacked or even outright scam by the exchange resulting to lose.

Topic: Why is it bad to leave crypto on exchanges? - page 4. (Read 1079 times)