The only downside of centralized exchanges is that if they decide to close and to keep our coins they will. But why the hell should they do that when they can maintain their business and still earn a lot of money. Moreover, they earn more from having the exchange working with no issues than to shut it and runaway with everyone's funds.
It is not like 10 years ago anymore. Centralized exchanges follow strict regulations which actually protect the user, on the other hand decentralized exchanges are pledged with hackers and bugs that can lead you to lose money. Now what centralized exchanges need to do is to apply decentralized storing options to users. that way they can still comply with regulation and still allow users to trade directly from their wallet.
Topic: Will there ever be any safe centralised exchange ? - page 9. (Read 2236 times)
Exchanges aren’t safe at all. Whether it’s centralised or decentralised, we need to avoid storing the funds in the exchanges. These are like a market where you just trade. The risk of getting your money or cryptos hacked are very high. So yes just use them when it’s required. Moreover as always advised keep your funds in hardware or offline wallets. Do follow these, else no one can stop you from losing your hard earned coins.
whether fiat or crypto. banks/financial services are never "safe"
look at the many countries that done bank runs in the last decade alone
however a "safer" exchange than currently should at minimum have:
1. user agreement terms that dont suggest the exchange can just cut a customer off at its discretion without notice/reason
2. if a customer has infringed a policy. dont just ban them.. disallow them from the internal service of market orders but allow them access to atleast withdraw their funds and leave the service with what they put in
3. if an exchange charges say 0.3 trade fee, put say 0.1 into a separate wallet to build up an amount to use as a insurance. which within 1000 trades per user, then funds fully insure amounts.
4. while customer adoption is occurring seek a regulated insurer to underwrite losses as a insurer where exchange pays a small premium whilst it builds up its own crypto insurance away from the fiat insurer
5. have the insurance as a multisig where a single person cant just raid it.
6. dont sell user data or swap it with other businesses unless under court order
7. no exchange to hide behind proxies, "virtual-office" or "PO-Box" or "rent-a-desk" services.
allow users to know where to send lawsuit or locate the company should things go wrong
8. put customer funds into a cold wallet that has atleast 90% of funds secured and auditable . where only 10% is at risk of immediate threat, on the hotwallet. where even the hot wallets are visible to see there are enough funds to meet customers withdraw demands of that day
This policy looks quite interesting to adopt if given a proper vetting. look at the many countries that done bank runs in the last decade alone
however a "safer" exchange than currently should at minimum have:
1. user agreement terms that dont suggest the exchange can just cut a customer off at its discretion without notice/reason
2. if a customer has infringed a policy. dont just ban them.. disallow them from the internal service of market orders but allow them access to atleast withdraw their funds and leave the service with what they put in
3. if an exchange charges say 0.3 trade fee, put say 0.1 into a separate wallet to build up an amount to use as a insurance. which within 1000 trades per user, then funds fully insure amounts.
4. while customer adoption is occurring seek a regulated insurer to underwrite losses as a insurer where exchange pays a small premium whilst it builds up its own crypto insurance away from the fiat insurer
5. have the insurance as a multisig where a single person cant just raid it.
6. dont sell user data or swap it with other businesses unless under court order
7. no exchange to hide behind proxies, "virtual-office" or "PO-Box" or "rent-a-desk" services.
allow users to know where to send lawsuit or locate the company should things go wrong
8. put customer funds into a cold wallet that has atleast 90% of funds secured and auditable . where only 10% is at risk of immediate threat, on the hotwallet. where even the hot wallets are visible to see there are enough funds to meet customers withdraw demands of that day
Making refence to this thread"Newbie Reminder: Treat Exchanges as Marketplaces" I'm not sure any exchange will have my complete trust because I'm assuming they're all unsafe.
Although there are reputable exchanges such as Binance, Kucoin, and others that deserve to be trusted, in this day and age, trust no one when it comes to investment because anyone can betray you at any time. All I need to do with exchange is buy Bitcoin and send it to my wallet.
Although there are reputable exchanges such as Binance, Kucoin, and others that deserve to be trusted, in this day and age, trust no one when it comes to investment because anyone can betray you at any time. All I need to do with exchange is buy Bitcoin and send it to my wallet.
whether fiat or crypto. banks/financial services are never "safe"
look at the many countries that done bank runs in the last decade alone
however a "safer" exchange than currently should at minimum have:
1. user agreement terms that dont suggest the exchange can just cut a customer off at its discretion without notice/reason
2. if a customer has infringed a policy. dont just ban them.. disallow them from the internal service of market orders but allow them access to atleast withdraw their funds and leave the service with what they put in
3. if an exchange charges say 0.3 trade fee, put say 0.1 into a separate wallet to build up an amount to use as a insurance. which within 1000 trades per user, then funds fully insure amounts.
4. while customer adoption is occurring seek a regulated insurer to underwrite losses as a insurer where exchange pays a small premium whilst it builds up its own crypto insurance away from the fiat insurer
5. have the insurance as a multisig where a single person cant just raid it.
6. dont sell user data or swap it with other businesses unless under court order
7. no exchange to hide behind proxies, "virtual-office" or "PO-Box" or "rent-a-desk" services.
allow users to know where to send lawsuit or locate the company should things go wrong
8. put customer funds into a cold wallet that has atleast 90% of funds secured and auditable . where only 10% is at risk of immediate threat, on the hotwallet. where even the hot wallets are visible to see there are enough funds to meet customers withdraw demands of that day
look at the many countries that done bank runs in the last decade alone
however a "safer" exchange than currently should at minimum have:
1. user agreement terms that dont suggest the exchange can just cut a customer off at its discretion without notice/reason
2. if a customer has infringed a policy. dont just ban them.. disallow them from the internal service of market orders but allow them access to atleast withdraw their funds and leave the service with what they put in
3. if an exchange charges say 0.3 trade fee, put say 0.1 into a separate wallet to build up an amount to use as a insurance. which within 1000 trades per user, then funds fully insure amounts.
4. while customer adoption is occurring seek a regulated insurer to underwrite losses as a insurer where exchange pays a small premium whilst it builds up its own crypto insurance away from the fiat insurer
5. have the insurance as a multisig where a single person cant just raid it.
6. dont sell user data or swap it with other businesses unless under court order
7. no exchange to hide behind proxies, "virtual-office" or "PO-Box" or "rent-a-desk" services.
allow users to know where to send lawsuit or locate the company should things go wrong
8. put customer funds into a cold wallet that has atleast 90% of funds secured and auditable . where only 10% is at risk of immediate threat, on the hotwallet. where even the hot wallets are visible to see there are enough funds to meet customers withdraw demands of that day
If you want to know which exchange is fully trusted and which exchange will keep your money 100% safe then I would say there is no such exchange but there are many big exchanges in crypto industry like Binance kuCoin etc but we cannot fully trust them. Because recently a major exchange like FTX has gone bankrupt which is bad news for crypto users and many have lost huge amounts of money through it. So no centralized exchanger can be trusted 100%. So you must use a non custodial wallet or hardware wallet to hold your crypto which will keep your crypto very securely
Using a non custodial wallet is absolutely fine and the best for the current situation in the blockchain industry as at now. No such exchange should be trusted and entrusted with funds and assets. Investors and traders have had a lot of experience which should be able to teach others lessons but the only thing that can be guaranteed about these third party exchanges is the fact that they do trading to enable traders and investors do business and transact, convert to fiat as the case maybe but it is no longer safe to hold your funds and assets in third party exchange anymore. Withdraw all funds after transacting for your safety.
Most exchanges hold their funds in cold storage which is pretty much secured but they do keep their hot wallets filled so they can proceed withdrawals without much delay and access all incoming deposits, exchanges has to keep their security as higher priority so most of the funds will be safe but remember hackers getting smarter so at anytime the exchange can be hacked if someone found the vulnerability.
FYI, exchanges aren't based on blockchain technology only the crypto transactions are.
FYI, exchanges aren't based on blockchain technology only the crypto transactions are.
Asking this question in the decentralised space is itself a crime. Lolz. 
Idk, may be we should keep safe distance from the centralised exchanges and kee trading our assets with at most care. If we still going to use centralised exchanges then we should be thinking twice before doing so for “long term” investment. If we have entry point then just buy at it and move the coins to wallet. Once market is green for it then get them back and sell. Could be troubling but worth it if we want to safeguard it. Or another best option is not to use the centralised exchange at all.
Idk, may be we should keep safe distance from the centralised exchanges and kee trading our assets with at most care. If we still going to use centralised exchanges then we should be thinking twice before doing so for “long term” investment. If we have entry point then just buy at it and move the coins to wallet. Once market is green for it then get them back and sell. Could be troubling but worth it if we want to safeguard it. Or another best option is not to use the centralised exchange at all.
I think it is rely hard. And if we had some safe centralized exchange wouldn't that mean that a lot of bitcoins benefits would go extinct such as anonymity?
How about yes with a but or no with a however.
From the security and financial side yes they can be safe. But you have to put in a lot of time and effort and money to do it. Which then means that you have to make that money back, so your fees are going to have to be higher then the next place since they did a crap job, but it was cheap, so then can charge less.
The safe exchange has insurance and financial audits and a lot of other things. They cost money, so their fees go up.
And so on. At what point do you have a safe exchange, but your fees are so high to cover the costs you have no clients.
-Dave
From the security and financial side yes they can be safe. But you have to put in a lot of time and effort and money to do it. Which then means that you have to make that money back, so your fees are going to have to be higher then the next place since they did a crap job, but it was cheap, so then can charge less.
The safe exchange has insurance and financial audits and a lot of other things. They cost money, so their fees go up.
And so on. At what point do you have a safe exchange, but your fees are so high to cover the costs you have no clients.
-Dave
There can be safe exchanges but you need to define "safe" first.
A safe exchange is one that isn't run by a scammer and one that was made to thrive as a business not make as much money in the shortest time possible and flee.
Safe doesn't mean safe from hacking or bugs. One should never hold money on exchanges. These are not places to store coins. They are exchanges, which as the name suggests means that you're supposed to exchange money and take them out of there.
A safe exchange is one that isn't run by a scammer and one that was made to thrive as a business not make as much money in the shortest time possible and flee.
Safe doesn't mean safe from hacking or bugs. One should never hold money on exchanges. These are not places to store coins. They are exchanges, which as the name suggests means that you're supposed to exchange money and take them out of there.
I'd say the exchanges that currently remained to be unhacked are pretty "safe"; probably Binance and Coinbase. But that doesn't mean I'll recommend leaving funds on these platforms. The developers can make the platform as secure as possible, but never secure enough to the point that it's impossible to hack. Exploits will always be a risk. Not because these "unhacked" exchanges remained unhacked for years doesn't automatically mean it'll stay the same forever.
https://NotYourKeys.org
https://NotYourKeys.org
How do you explain these things to the people whom have entrusted their funds and assets to you for safe keeping hoping that what they gave to you is under safe care only to wake up to a sad news of their assets being stolen by hackers. How do you explain all these.
That's why you don't let other people entrust their funds to you. You have not much to gain but everything to lose.I don't think Binance is exempted from being "unhacked". They've got hacked years ago.
Source: https://www.wired.com/story/hack-binance-cryptocurrency-exchange/
And also Coinbase: https://www.pcmag.com/news/coinbase-discloses-that-6000-customers-got-hacked-this-spring
It's clear that no exchange is safe for us to store funds until now even if it's the best in the world. It's possible that Binance and Coinbase may get hacked again in the future, as these hackers are also improving their skills to create backdoors. Just saying.
The way I see it, this is going to steer us away from third party wallets. Which is a big plus.
The very nature of Blockchain is to get as far as you can away from centralization as you can and to be your own bank. Why anyone would trust a single, imperfect entity (like an exchange) to hold on to your money for you, I will never understand. I do not want my money to be compromised by some fat scammer dude and his goblina girlfriend just because they got too greedy and their scam came to light. Thats the opposite of what Blockchain stands for (decentralization).
The top exchanges like Binance are quite safe places to trade our coins, but they will be always not recommended places to keep our coins for a long time. There is no guarantee of safety from hacker attacks, no guarantee of safety from manipulation, and no guarantee they will survive for a long time. Since centralized exchanges fully control our crypto coins, it will be always very risky to leave coins there. I only assume they are safe for trading places, but not for holding places.
Just think of any centralized exchange as a target to the hackers. They're closed source and who knows if they'll be attacked through the inside. You know that greed is everywhere especially if hundreds of millions will be involved.
Just don't trust them with all that you've got.
And always treat them with a grain of salt if it's about safety of your funds whether they're the most known and trusted, still, don't play too confident with them.
Just don't trust them with all that you've got.
And always treat them with a grain of salt if it's about safety of your funds whether they're the most known and trusted, still, don't play too confident with them.
I was wondering if there could still be any safe centralised exchange in the blockchain industry. Of lately lots have been unveiling itself and centralisedexchanges are at the end of it all. Does it mean that these centralised exchanges that are in existence lacks the capability to safeguard assets and funds after attracting investors and traders to their platforms for engagement and activities?
How do you explain these things to the people whom have entrusted their funds and assets to you for safe keeping hoping that what they gave to you is under safe care only to wake up to a sad news of their assets being stolen by hackers. How do you explain all these.
At first identifying the problem is a basic course for rendering solutions. If these problems are not identified immediately by the exchanges for quick remedy then who's to be blamed for it. Do they really do constant check on their service to know their lapses, if they do, do they identify it immediately with utmost attention? Do they do a constant check and evaluation on their staff and mechanisms.
With all these said, what are your opinions on this subject matter as I feel this needs to be looked into for possible measures to be taken for so as to further prevent or minimise the rate at which exchanges get hacked or being careless with investors and traders funds.
How do you explain these things to the people whom have entrusted their funds and assets to you for safe keeping hoping that what they gave to you is under safe care only to wake up to a sad news of their assets being stolen by hackers. How do you explain all these.
At first identifying the problem is a basic course for rendering solutions. If these problems are not identified immediately by the exchanges for quick remedy then who's to be blamed for it. Do they really do constant check on their service to know their lapses, if they do, do they identify it immediately with utmost attention? Do they do a constant check and evaluation on their staff and mechanisms.
With all these said, what are your opinions on this subject matter as I feel this needs to be looked into for possible measures to be taken for so as to further prevent or minimise the rate at which exchanges get hacked or being careless with investors and traders funds.
From recent happenings around the centralised exchange and with the ways CEOs are being careless and reckless with investors and traders funds and assets, I really do not think there are still safe exchanges anymore hence not your key, not your funds. As exchanges are beginning to get prone to hackers, it is advisable to put or keep your funds and assets in your private wallet as you alone have access to it. When you have your assets and funds in an exchange, they do not belong to you because you do not have the private keys so to be on the safe side, after trading,you withdraw your profit to your private wallet if you wish to keep any remaining in your wallet,it should be a little funds which would not affect you if stolen.
I was wondering if there could still be any safe centralised exchange in the blockchain industry.
about this secure exchange question this is something we all know the answer to, and I will say my opinion, this is a market that is not yet regulated, with that exchanges do not have a company headquarters, they do not have a physical place in which the people can complain, exchanges have anonymous owners in most cases and even if the owners are not anonymous they can also be scammers, so in my opinion we don't have safe exchanges, what we have are some exchanges with a little more security compared to others exchanges and with that we cannot leave large amounts of money in the exchanges, it is better that each person when they know that they have already finished doing day trade, withdraw all the money from the exchange or just withdraw and leave a small part in the exchange, it is not confined to the exchanges
Of lately lots have been unveiling itself and centralisedexchanges are at the end of it all. Does it mean that these centralised exchanges that are in existence lacks the capability to safeguard assets and funds after attracting investors and traders to their platforms for engagement and activities?
this is a market that is not yet regulated so there are no clear laws on how exchanges should work and proceed with customer funds, there is no insurance company that can cover all costs when an exchange is targeted by a hacker, these are issues that lack regulation, for example exchanges could be keeping people's funds in a very safe wallet or in several very safe wallets, so at the time of some theft by the hacker the exchange would not suffer large losses, this is not something difficult to do and for this reason, whenever they talk about a hacker attack, I always suspect it is an internal work of the exchange, and now we have other problems, such as the exchange owners using the customers' money and going bankrupt, something simply unacceptable
How do you explain these things to the people whom have entrusted their funds and assets to you for safe keeping hoping that what they gave to you is under safe care only to wake up to a sad news of their assets being stolen by hackers. How do you explain all these.
there is nothing to explain why from the beginning it is being said: "don't trust exchanges, don't leave too much money on exchanges" so people are aware of the danger of exchanges
Hypothetically, it seems that it's not hard to make an exchange that will be safe for its users. You need very strong security to resist hacking attempts, but also you need to NOT MESS with the money of customers. No reinvesting the money, experimenting, funding some projects etc. with what people think it owned by them and is in their wallets. How to make profit and cover the running costs, then? Ads on the platform, trading fees, withdrawal fees.
In such scenario, an exchange cannot go bankrupt (or, rather, it can eventually, but there will be no victims among the customers because all of them can withdraw their money at any point.
In practice, there should always be room for doubt that a centralized service is not doing anything funny and is operating it a very honest way. After all, not your keys, not your coins. So I'd stick to using exchanges only when necessary, not hodling there, and using only the most trusted exchanges like Binance.
In such scenario, an exchange cannot go bankrupt (or, rather, it can eventually, but there will be no victims among the customers because all of them can withdraw their money at any point.
In practice, there should always be room for doubt that a centralized service is not doing anything funny and is operating it a very honest way. After all, not your keys, not your coins. So I'd stick to using exchanges only when necessary, not hodling there, and using only the most trusted exchanges like Binance.
If you want to know which exchange is fully trusted and which exchange will keep your money 100% safe then I would say there is no such exchange but there are many big exchanges in crypto industry like Binance kuCoin etc but we cannot fully trust them. Because recently a major exchange like FTX has gone bankrupt which is bad news for crypto users and many have lost huge amounts of money through it. So no centralized exchanger can be trusted 100%. So you must use a non custodial wallet or hardware wallet to hold your crypto which will keep your crypto very securely
I believe it is only a matter of time before government will forbid exchanges to convert bitcoin to fiat currency.
Why should governments ban centralized exchanges when it's a great tool for them to control us as banks control us? vice versa: the centralized exchanges here will be upgraded and will probably be legalized as banks dedicated to the cryptocurrency market.
For citizens to get around government control, societies must price goods and services directly in BTC so no exchange is needed.
Imagine that 100% of Europe, the USA and China forbid goods to be priced in BTC by law. That it would only be allowed in impoverished states like Venezuela, El Salvador..
If this was the case, would BTC still have value?
Imagine that 100% of Europe, the USA and China forbid goods to be priced in BTC by law. That it would only be allowed in impoverished states like Venezuela, El Salvador..
If this was the case, would BTC still have value?
And again all of that is just your imagination and doesn't have any basis in your statement. China banned bitcoin but unfortunately it doesn't work with bitcoin and I will wait for US and Europe to see if they need bitcoin or will remove it like China. They are great powers but that doesn't mean that without their support we would die.
people need to think of a exchange as that.. an exchange. like when you go to a travel vacation money exchanger. you swap your currency and take the other currency out and keep it with you. within minutes of leaving the service.
leaving it on the exchanges counter thinking its safe there to leave and you can come back later and claim it .. is not something people usually do when they do currency conversion in the real world
those using it as a day-trader account. dont put your lifes worth in an exchange to put on a market order. only put in 5%-10% and day trade the hell out of the market wiggles of 1%+
those small 1% often add up. dont risk more then you can afford to lose on a gamble that the market will wiggle by 10% in a short/mid term length
for those used to the banking system of savings accounts
learn quickly that crypto-custodians dont have the same customer protections and assurances as banks.
read the TOS user agreement about when does the custodian accept liability for loss. or what policy they have about closing account.
if it reads as "company accepts no liability for loss, by using the service you agree to terms"
if it reads as "at company sole discretion, at any time, without notice, for any reason"
stay away
yes theres more "freedoms" about withdraw limits and such in crypto. but your funds security is more at risk.
leaving it on the exchanges counter thinking its safe there to leave and you can come back later and claim it .. is not something people usually do when they do currency conversion in the real world
those using it as a day-trader account. dont put your lifes worth in an exchange to put on a market order. only put in 5%-10% and day trade the hell out of the market wiggles of 1%+
those small 1% often add up. dont risk more then you can afford to lose on a gamble that the market will wiggle by 10% in a short/mid term length
for those used to the banking system of savings accounts
learn quickly that crypto-custodians dont have the same customer protections and assurances as banks.
read the TOS user agreement about when does the custodian accept liability for loss. or what policy they have about closing account.
if it reads as "company accepts no liability for loss, by using the service you agree to terms"
if it reads as "at company sole discretion, at any time, without notice, for any reason"
stay away
yes theres more "freedoms" about withdraw limits and such in crypto. but your funds security is more at risk.
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