Topic: Why is it bad to leave crypto on exchanges? - page 6. (Read 1079 times)

We have to be selective in choosing exchanges that have developed and are well established, that it is not easy for an exchange that already has a good reputation so it is very impossible to damage reputation by stealing traders/investors' assets, I'm sure not for Binance because of that exchanges thrive on reputation crypto community around the world.

The reasons I don't leave it there:

1. They can do whatever they want with the coins.
2. Not my keys, not my coins.
3. I have no power over my coins, other than the interaction with the exchange account that can be closed at any time for any reason.

Of course, you are!
They have to give some offers such as giving interest over the money you invested otherwise why would you keep your assets and your money there? that's just because they want to attract people like you to keep your money there, nothing else. Keeping your money and your assets on exchanges like Binance was never safe because they won't give you access to your private keys or your recovery seeds, so you do not actually own your coins they can suspend your account for no reason.

It safer to hodl or leave crypto meant for only trading or stalking purposes in any reliable exchange, while hodling the profits or other huge cryptos assets in a wallet, the rate at which hackers are getting more sophisticated is a serious concern to crypto users and exchanges, it's on records the huge amount of crypto stolen by hackers had rendered the choice of hodling cryptos in exchanges as a very risky option, though reputable exchanges spent hide amount of funds on their firewalls, however it's obvious majority of huge cryptos hodlers stored their coins in a hardware wallet with their possessions of the keys.

In a simple explanation, since your funds are being held at a third-party platform, you won't have full control of it in the event of an alleged hack and scam. You can't even withdraw it and all you need to do is to wait for the service to be back. In the worst-case scenario, they won't come back.

It's not totally wrong to subscribe to an interest-earning feature of exchange but to somehow minimize the risks, always choose the well-established ones. Not an assurance that everything is safe but at least, they won't likely to sh*t your funds that easy.

I had an experience not long ago with the Okex exchange where we weren't able to withdraw our crypto assets I think for more than a month if I am not mistaken and the reason was not clear because they don't want to break down what really happened. But thankfully they get back and their service was resumed as usual but the point here is what if they are close forever? so as your crypto assets are trapped there forever as well without knowing when to get them back. That's why everyone has their own hard wallet of their choice to avoid such kinds of tragedies.

reason why warning moved of not leaving your funds on exchanges is because of security reasons of the exchange. Because exchanges has their own coder's and programmers why computers wizards who specializes for decoding is interested of hacking any exchange that's gathered by funds. And i believe that this exchanges have competitor and it is possible to another to hack for getting more customers. I don't keep my coins in exchange because it can be hacked and the can not refund you. It is better Saving funds wallet like ELETRUM

Since 2011, over $1.65 billion worth of crypto assets have been stolen and the numbers are getting bigger every year.
You can't know what gonna happen to the exchange, it may mismanage, lose, or whatever .
It's dangerous to keep your there i don't know if you guys have heard of about QuadrigaCX whose owner had passed away with all the private keys, allegedly losing access to 190 millions dollars of user funds. Who expected that?  
And others got hacked like mt gox.

There have been tons of instances where exchanges have been linked to several scams and hacks in the past.

Recently, an exchange (Ronin) was hacked and more than millions of dollars worth of ETH were stolen from the exchange which affected some "pay-to-earn" games (e.g. Axie Infinity, etc.) in their transactions. In addition, there are also cases where exchanges have been tagged as scams in which some of your cryptos would be frozen in the process.

Generally, it is highly recommended that you move your cryptocurrencies in a more secured hardware wallet for proper storage and security. Leaving them in an exchange would only subject you to extreme risks of losing it in the unforeseeable future.

Except that they censor, charge unnecessarily high fees, blackmail for your private information, dictate by forbidding you to send money in certain cases, create an illusion of "taint coins" that have been involved in "illicit activity", whatever the hell that means. What have I forgotten? Oh right, if they go bankrupt or get hacked, which is a common phenomenon, you lose everything.

This isn't what I call the "most secure thing".

there are such cases, and bitfinex is one of them. when the exchange was hacked, they only replaced 30% of the lost funds their users had. and it was a big case in the history of cryptocurrencies. that's why putting all your assets on the exchange is a bad thing. no system is secure, that's why we can't trust it even though they say that their platform has good security. because when your account is hacked, the exchange will not replace your lost assets. all errors will be passed to the user.

At the very least, security issues. It should be understood that if you leave the currency on the account, it may not be safe.

The fact is that exchangers such as binance, kucoin, latoken, etc. are usually used to exchange different coins or tokens. And with these you can trade but these are the most popular websites in the world. These are the most secure things that are not likely to be hacked and they never steal funds.

You can hold your money on an exchange if it's a highly reputable exchange and if you trust it. Also, it should include you being ready to get your funds out of it if some new regulations arrive (like those for some Russians arrived from Binance today), willing to send documents that confirm your identity and address, and be sure you're not doing anything illegal (and technically, not paying taxes is illegal in places where cryptos are regulated). These are centralized services, so they can do a lot of stuff. If it's a very good exchange like Binance, it likely won't perform an exit scam, and will likely compensate losses in an even of a hack, but something can still happen. Overall, your money is just much safer in your personal wallet.

What you should know about the Crypto Exchangers History:

1. Mt. Gox (2011): the first major breach in the crypto world
    First Instance: $8,75 million got hacked in year 2011
    Second Instance: $ 615 million got hacked in year 2014

2. KuCoin (2020) –
    Criminal stole around $281 million in coins and tokens.After investigation only $204 mln were recovered but rest is lost.

3. Upbit (2019) – the hack that made use of a single transaction
    This was done in team and from them two were the Chinese nationals. Steal was $45 million.

4. BINANCE (2019) – the biggest name to be hit
    Stolen 7,000 Bitcoin, value at the time was ~40 million USD

5. Bitfinex (2016) – the hack where losses were distributed
    Stolen 60 millions USD. They recovered some funds and only distributed that much to the users.

6. CRYPTOPIA (2019) – the curious case of two attacks
    Since this was small exchanger at the time of attack they swiped around 9% of their total holdings which were around $15.5 million.

7. ZAIF (2018) – the attack that was identified too late
    Stolen $60 million. Some funds recovered however it was huge loss for the company.

8. BANCOR (2018) – the hack where users went unscathed
    Stolen $23.50 million.

9. COINCHECK (2018) – the biggest hack so far
    Phishing attack was done to steal the money. Stolen and lost around $534 million

10. COINBENE (2019) – the hack that wasn’t admitted at first
     $105 million stolen in different currencies.

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If you still think it is safe to store our crypto currencies on an exchanger then just pray that you are not one of the user whose money is stolen at the time of next hack

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Read full history here.

This is a problem you know wouldn't think would happen entirely, but it's better to be safe than sorry. As other members said, it's not good to keep everything on an exchange. It's suitable for profiting, but what if a hack might affect your capital there? What would you do then? Are you going to cry and shout scam? Even though you know it should be the exchange's responsibility it checking the vulnerability of their exchange, there should be some responsibility on the user to prevent life-threatening or lifestyle changes in the invested amount.

It would be best to find staking or earning potential that uses your wallet or some hardware wallets that have to stake and make money from HODLing etc.

If you check well, more than 80% of the people that contributed in this thread are advising against leaving coins on an exchange. They have also referenced the popular phrase "Not your key, not your coin".
But if you check the reality, the volume of coins in Binance is outrageous, then I ask myself, who owns those funds there.

You will discover that we don't practice what we preach. I know exchange like Binance is reputable and you can leave your fund there if you are a day trader, a merchant who also switch from crypto to fiat. Then, the advice is don't leave the majority of your funds on exchanges.

I think that earning a few satoshi for the "Earn" is not worth it, users have already mentioned the corresponding technicalities, so you should follow these tips and not risk it, but in any case each person is +18 and must make decisions based on the information, asking that question of the OP is actually a great disinformation.

So the belief of having a profit of a few poor percentages is not the bad thing, if it is what you like, just do it, but you must understand very well it is about having control and to be administrator of your assets. If you know the risk that exists after everything you have been told, you have to be very dumb to have 100% of what you own in an exchange that does not allow you to control your seeds.

or.. unless you need to put up sell offers for trading purposes, you could simply just send the coins/tokens to the exchange the money you're planning on selling them. That's just a teeny tiny bit amount of inconvenience in exchange for not putting your funds at risk. Or do you think for some reason that it's not a good enough r/r?

You didn't get the point, the reason why you shouldn't leave your coins in exchanges because you can't know the exchanges is still operated or not in the future. If you have leave your coins on an exchanges which never got hacked until now, you're lucky since every year there's always an hack incident. I would rather spend some satoshis and times to secured my coins fully 100% on my wallet rather than leave them on exchanges to save some fees.

That's a same case like leaving your coins to centralized party.