Safety and holding on to your crypto are one of the most important choices you can ever do especially if you hold a wealth of crypto in your wallet or wallets. Now personally for myself I spread my crypto across various networks such as multiple hardware wallets that never touch a connection to the internet, some CEX, some DEX and some hot wallets. And to be honest if you want to interact with many blockchains you're actully going to need around 5 wallets in total in order to do so which is just wild lol.
The crypto world in itself isn't very user friendly and what we have been seeing a shift from self responsibility on to exchanges otherwise know as CEX (example Coinbase) these user friendly sites offer up a nice user interface, rewards etc that people are more used to instead of doing it themselves but is your crypto really safe? Let's take a look at the ever changing landscape.
Now the reason I bring this up today is because of the increasing demand of crypto lately and also many of the new people entering the space or expanding the space. We can just look back a few years ago at platforms like FTX and see why placing your crypto in the wrong place can seriously set you back.
Coinbase
Love them or hate them coinbase has done a good deal for the crypto space and also legitimizing it. While I don't like holding my money in any CEX coinbase does offer up some great and what many would say rather safe investment ops. Now you'll be paying fees for things such trades and fiat to crypto but it's one of the easiest on ramps of fiat into another cryptocurrency especially since Coinbase has opened up to many alternative tokens heck you can even get PEPE on there now!
Anther thing people go after are staking rewards. While many people don't have 32 ETH or even want to bother with running a node themselves they can still earn interest on stacking reward tokens while giving a little up to the CEX in this case coinbase. It's a fair trade off for MANY.
Kraken has been around for a while and you catch wind of it rather often. I'd place it up there with Coinbase honestly in terms of amount of people using it and features. It's a platform that was actully launched before Coinbase out of cali.
Now the big point behind this one is the creator of Kraken actully worked at Mt. Gox a crypto exchange that had major security issues. However the Kraken CEO noticed these security issues and decided to launch his own platform that centered around building a secure CEX and launched Kraken.
Another big point about Kraken is it's also used and register in over 100 other countries. They have done a rather good job over the many years with a proven track record of being as compliant as possible and to keep a high security system.
CEX Risk
Now it's important to note that any CEX has risks. The company could go bankrupt, it could be bought out, something could error out and you lose your crypto and so forth you're not really the owner of the money. It's pretty much like taking your fiat money and dumping it into the bank and then having the government back it up. However if any of these crypto places go belly up there's no security that you're going to get your money back ever.
Your Own Wallet
This is where owning your own wallet comes in but it still comes with risks. For the most part it comes down to yourself. Lose your keys and forget them with no backup and you're pretty much never going to get into that wallet again. There's also security issues yourself if you connect the wallet into a shady account or click on a wrong link.
This is why many people don't like doing their own wallets as it's extra effort and you have to trust yourself. There's no more if someone else screws it up for me I can get count on someone else to bail me out.
I'd highly recommend learning how to use your own wallet and then also just backing it up in secure locations and or dividing the crypto up over a few wallets so if one gets compromised for whatever reason you don't lose everything.
For the most part though I believe you can keep some funds in certain CEX and be ok. However I wouldn't put all my wealth into one and hope for the best. Be proactive with your investments, educate yourself and use it.
Posted Using InLeo Alpha
Don't even have to read the post to tell you that centralized exchanges ARE NOT SAFE!!! Not your keys, not your coins! PERIOD! They will track everything you do and tie in your wallet address with your real world ID. This is not a good thing! Use DEXs when possible and use companies that accept it directly or through gift cards when you can.
I use Coinbase mostly I think they should be safe as they are the big fish right now.
great topic. it's always good to talk about these things. I have re-evaluated Coinbase in the last 2 years. it has had slow growth but more in line with the guidelines of the various States
We all have transactional relations with CEX and that will continue to remain. However, there is a sector of crypto population who just do not want to gen into the know-how of self-custody and that is a dangerous precedent, could be the reason of failure. You can not afford to delegate the custody for a long time to a third party even when how reputed it is. So self-custody should be a learned tendency of a crypto user at any given point of time.
I dont think any exchanges is chrystal safe entirely. Especially in the phase that goes from bull to bear when a lot of liquidity is pulled off and everything behind the scenes aint so flashy anymore....that is when it gets scary.
But indeed...own wallets...man....I have had my share of fuckups with this already before
You should explain me a little more about Coinbase, especially in view of the great need in Venezuela, to use it more often, especially if its use must be safe.
https://inleo.io/threads/view/omarrojas/re-leothreads-2awswr7jv?referral=omarrojas