Funds on Exchanges

Take your funds off of exchanges

• Leaving your funds on exchanges is a risky habit. Exchanges can:

  • Lock your funds and halt withdrawals without any notice. This may change when regulation inevitably comes into the picture.

  • Misuse customer funds. For example, reinvest customer funds, held by the exchange, for other investments. I will not get into the legal repercussions, but keep in mind this is not an allowed behavior.

  • Go insolvent. Meaning “unable to pay debt”. This also means that they may not have the funds to deliver to customers when they want to withdrawal

  • They are also susceptible to being compromised (attacks, hacks, etc)

• You may be able to get a higher APY on exchanges, but typically this is not sustainable. And is it worth the risk?

  • I prefer to keep the mindsight as: “I would rather miss 9 out of 10 opportunities, instead of getting compromised 1 out 100 times.”

• Stake your Crypto with Community Stake Pools. Do not rely on an exchange having custody of your funds. This means that they technically have full control.

• Only use an exchange for it’s intended purpose. For exchanging crypto <> fiat. Do your business and get out.

• Remember the most recent exchange stories: Voyager, Celsius, FTX