Leaving Crypto On Exchanges: Safe Or Risky?

Posted 2 years ago in BLOCKCHAIN.

The act of leaving crypto on exchanges is very common among crypto enthusiasts. This causes increasing crypto frauds, scams, and glitches resulting in millions and billions of losses.

Leaving Crypto On Exchanges: Safe Or Risky?

The act of leaving crypto on exchanges is very common among crypto enthusiasts. However, in the times of increasing crypto frauds, scams, and glitches that caused millions and billions of losses, is it really safe to leave your risky assets at further risk? The answer to this might be much more complex than you might think. This is because of the updating and volatile nature of the crypto domain. At one point, you might think that the conditions are perfectly fine, and at the other moment a mishap could occur. So, what to do in fear of that situation? This is what will be discussed in detail in this article.

Crypto trading has been gaining immense popularity in recent months and has also triggered demand for crypto exchange platforms to be able to freely deal with this volatile asset. Several crypto trading platforms have also released wallets for storing crypto funds. This has aided users in many ways but might also cause damage to them. There are recent incidents to prove the same. Even a major exchange, Coinbase, failed to maintain track of the wallet fund deposits and thousands of users had lost access to GYEN in their wallets recently. Therefore, it is necessary to make the correct choice for storing your crypto assets.

Leaving Crypto On Exchanges: Benefits & Dangers

Leaving crypto on exchanges does have some potential benefits that have been listed below.

  1. Easy Trade: One can easily trade crypto through the assets available on any crypto exchange platform. This is because these exchanges are designed to optimize the trading experience for their users and ensure safe crypto trade.
  2. Convenience: It is way more convenient to store crypto in an exchange platform rather than looking for secure wallets and then transferring the value to them.
  3. Trade Pairs: Crypto exchanges enable you to profit from the price difference in two digital currencies as you can trade these crypto pairs against one another.

Though leaving crypto on exchanges mostly doesn’t lead to any negative outcome, it is not always necessary. Therefore, here is a list of risks and dangers linked with it.

  1. Theft: The crypto exchange security might not be enough sometimes even with the utmost attention. However, there are still huge chances of your wallet being hacked and your crypto assets being lost. This is the biggest danger that one can face if they irresponsibly leave crypto on exchanges.
  2. Unreliable: Even major crypto trading networks can become unreliable at times as they might abruptly go offline and face technical glitches often.
  3. Crypto Frauds: In the past, there were incidents wherein some crypto exchanges had taken their users’ crypto funds and never returned them. This can happen if one doesn’t research the platform before adding investments to it.
  4. Fear of Bankruptcy: At any point, a crypto trading network can go bankrupt, and once that happens all your crypto funds are permanently lost.
  5. If somebody is Long Term Risks: leaving crypto on exchanges, then they might lose funds in the long term as crypto price actions are extremely volatile. Therefore, it is recommended not to leave your crypto on an exchange for too long.

How To Protect Your Crypto Funds?

Even after reading the aforementioned dangers, if you still are motivated enough to undertake the risky act of leaving crypto on exchanges, then here are some ways to protect them. The methods and steps for the same are listed below.

  • Make sure to set a strong password for your account on the exchange.
  • Enable two-factor authentication for better security.
  • Try not to use public Wi-fi networks.
  • Be cautious of phishing scams and other cyber attacks.
  • Update your computer and antivirus system as and when available.
  • Store crypto assets in a secure online or offline wallet.

The several benefits that the crypto domain provides would be completely flat if you do not take the initiative of storing them properly. Therefore, you should try considering various offline and online wallets that are available. However, it is recommended to use secure offline wallets for better security. This will free you from any burden or stress of losing your crypto assets. A number of such offline hardware wallet services have been introduced on the belief that the future of money is indeed digital. Some of the best hardware crypto wallet examples are TrezorLedger Nano S, CoolWallet S, and Ledger Nano X. However, these might not support all the cryptos available.

Crypto Venture

Living in United States