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Centralised Crypto Exchanges – Reality Behind The Doors

Centralised Exchange is a Digital marketplace where one can buy/sell cryptocurrencies using other cryptocurrencies and fiat currency.

When you buy your Bitcoin, Ethereum or other crypto, you’ll have the option to leave it sitting in the exchange where you bought it, or you can move it into another sort of storage system, umm, I mean hot or cold crypto wallet.

Keeping your crypto on the Exchange is an easy option. But, there is 2 thigs to have in mind. 1. Cryptocurrency exchanges are a target for the most aggressive hacker groups. 2. Not your keys, not your coins.

History reveals why it is dangerous to leave your crypto funds in an Exchange. Since 2011, over $1.65 billion worth of crypto assets have been stolen , adjusted to inflation that amounts to jaw-dropping $12.6 billion loss. And the numbers are getting bigger every year. As the history of the exchanges shows, no platform is hack proof, and issues always occur when you expect them the least. Exchange Exchange: Exchange

Aside from hacks, the trouble may arise also from within the exchange. Any Crypto Exchange may mismanage, lose, or even participate in fractional reserve banking. On top of that, leaving crypto on exchange means funds are owned by 3rd party. It is a well known experience when out of the blue Cryptocurrency Exchange puts a withdrawal threshold once you start withdrawing the money (welcome to wolf street!)

To your surprise, Crypto Exchange can decide what you can do with hard-earned money or even lock you out of your cryptocurrencies.

In short: so long as you don’t store it in your own hot or cold wallet with your keys, your funds remain at someone else’s mercy. As they say:

Not Your Keys, Not Your Coin

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