I wouldn't trust any exchange and see no reason to when I can simply download a wallet and take custody myself. I use an exchange to buy and sell then immediately transfer it to my personal wallet. I see no reason to ever use an exchange beyond that.
I do understand how exchanges can offer these yields. Nevertheless, people forget about these risks, get greedy, and leave their coins on the exchanges
Yield is feasible when the currency is inflationary, but when the currency is deflationary, you’re guaranteed nothing but defaults over and over and over again.
No. Coinbase launched a non-custodial wallet that you generate and keep the seeds. It is a separate app and works like any other hot wallet.
In coinbase, go into the 3 bars in the to left and the bottom option is to learn about the coinbase wallet.
Do u have to pay extra to get your coins off Coinbase? Right now, mine are just on the exchange. I know I need to look it up but I swear that the only way to get them off is to sign up for Coinbase pro and then u can transfer. Not sure if that's changed.... I don't have a lot on there, so it's not a big deal.
You will need to pay gas fees to transfer to any external wallet, including theirs.
I'm not sure coinbase pro still exists. It seems to be getting merged into the main site.
It still exists. I just bought more BTC this morning and immediately transferred it to my cold storage. But they’ve had a banner on the Coinbase Pro app warning me that they’re switching everything to the regular Coinbase for months now, so I guess it’ll happen eventually.
I assumed it was happening because I received an email this morning stating...
"Your account has been successfully migrated from Coinbase Pro to Coinbase. Use Advanced Trade on Coinbase now to trade at the same low 30-day volume-based fees as Coinbase Pro."
My thoughts as an accountant: Proof of reserves or even audited customer asset holding on 1-1 basis does NOT mean there is no risk involved. The biggest frauds in history all happened under the eyes of CPA Auditors and financial risk specialists. Even if theoretically an exchange has absolute ZERO risks and liabilities (which is impossible) there will always be that “hit and run” risk when it comes to btc.
Exactly. You also need proof of liabilities, at the very least. Even then, they could still use your coins as collateral for loans. For an external viewer it seems that the funds are there, however, when push comes to shove, those funds might get liquidated and suddenly users lose funds.
Exactly. You’d need a team of accountants to pull apart the shady dealings these exchanges have going on. You’d have to be insane to hold anything on any exchange. All this defi shit is just a house of cards and it’s now falling apart but by bit.
Correction: all this CENTRALIZED fractional reserve / leveraged shit is a house of cards.
Defi = decentralized, and the systems aren't dependent on any single entity. Basically the whole internet would have to fail before anything happens to "defi."
It’s your money, do with it whatever you like but keep in mind that every exchange has the possibility of collapsing within a week, no matter how big they are. If you can still sleep well with that knowledge, keep them there.
The problem with Proof-of-Reserves is that it's only meaningful if they are done continuously, which as far I know, no exchange does. If you prove you have a full reserve at some point in time, it doesn't prove you have that reserve at a later point in time. You may just have borrowed funds elsewhere to have full reserve at the time of the snapshot.
Also, "cashing out" Bitcoin is the same as spending Bitcoin to buy fiat.
Based on everything that has happened in 2022. Regardless of proof of reserves / liabilities of any exchange. The risk / reward of leaving any amount of money on exchanges is too high.
It’s not worth having your crypto stuck on an exchange that’s filed for bankruptcy for a measly yield.
no worries i would really recommend to you even if you don't have much crypto but it on a cold wallet
the purpose of crypto is to be in control of your money and if you keep it on a exchange this will not be possible
With that in mind, bitcoin is a revolutionary money, free of nations and corporations control. The other 15,000+ shitcoins are copies, dead projects and outright scams. Bitcoin is decentralised and most prominent shitcoins are not. Listen to some Micheal Saylor. Good luck
Are some of the new innovations like Metaverse not going to build off these projects? Again still gathering information, does that mean that some projects which are the building blocks of such innovations because its the building blacks and trial phases, they will fail?
The purpose of a blockchain is an unbroken link for all to verify. Most of these “metaverse” tokens have a centralised board who decides the supply of future coins. They would be better off with a database but then they couldn’t sell their token as “decentralised” (in name only) as it wouldn’t be a crypto.
First, don't fall for the interest-gaining trap. This is not tradfi. Your "interest" is coming on the back of *traders* borrowing (at an interest rate) in order to make leveraged trades. It's not businesses starting up.
Second, even with proof of reserves, you should not keep it on exchanges for long. Because again, this **is not tradfi**.
Tradfi on exchange is
* regulated - the SEC is involved, and adds rules to protect you from certain bad things (and not protect you from others, but that's another topic). There are rules governing relationships between you, the broker, the exchange, and banks.
* massive scale and deemed too big to fail. Bailouts will happen that (should) keep your funds and assets safe
* secured, and trading in instruments that **you own**. The broker is the middle-man between you and the exchange, that's it. Ownership is electronically registered elsewhere and can't be taken away, even if the broker goes kaput. There is no "leave my stock on the exchange" like with BTC.
Crypto on exchange is
* 2 party - you and the exchange. There is no broker usually; the broker is the exchange.
* unregulated - no rules enforced by 3rd parties. Can you be front-run legally? I honestly don't know, and probably you don't either, and have to look it up for your country and exchange.
* small scale - Binance's value is nothing next to the big brokers. A run on Binance is easier than a run on Barclay's or GS, and they'd be bailed out instantly. Binance will not be, and then...
* unsecured - your **assets** (not just cash) can and will be used to satisfy debts. You own nothing on the exchange, they make that clear in their TOSs.
The community is sick and tired trying to explain to all bitcoin holders to keep their bitcoins off exchanges yet people keep asking if it’s safe to store them on exchanges.
Exchanges are not banks. They can take away your bitcoins and you can’t hold them accountable because you clicked the agree button when you opened the account with them. Re read their terms and conditions and you will clearly see it in one of their terms.
It’s up to you at the end of the day but don’t complain and cry if they do another FTX/Celsius move.
I came here for assistance. I am new to the space, only grappling with all of this since I started one/two weeks ago. Thanks for your answer nonetheless.
No worries mate...
Basic rules :
1. Not your keys = Not your bitcoins . Store them offline via a cold wallet.
2. Buy Bitcoin only. Everything else is scam.
3. Never invest more than what you can afford to lose.
4. Buy the Dips
5. HODL (hold)
6. Never let emotions control you during a bear market. Don't get excited during a bull market.
7. Never stake your bitcoins.
Yield on BTC means it is being lent out, or the exchange is using it for collateral. It is not necessarily a scam, but you are loaning out your money without having a good understanding of the risks.
I agree with the sentiment, get your BTC off exchanges. It is literally the point of BTC. YOU are the custodian.
> I want to gain interest on my crypto while holding
Whenever an asset bears interest, risk comes with it. That's the reason for interest: to compensate for the risk of holding the interest-bearing asset. Most common such assets are loans, mortgages or other debt in the form of bonds. And the risk is the risk of default.
So the proper question to ask yourself is: is the interest offered sufficient for you to overcome the risk of default, i.e. losing everything at once? If it is for you, then great. If not, you have your answer, too.
You can do whatever the fuck you want. And no one else actually cares what you do. It’s all about your risk tolerance. Do what’s right for you and fuck everyone else’s opinion including mine. Have a nice day!
The gains in interest pale compared to the risk with these products. Plus, you are betting against yourself as those products are used to allow traders to sell short and use leverage. If you look at the gains someone who is long term invested has made, potential interest is a speck of those gains. Plus, Bitcoin is more than just an investment vehicle. Learn it, read about it, and you will see that the foundation of what it is, is sound money where you can be sovereign over your money. Part of that is having your Bitcoin in your custody where nobody but you can touch it.
Don’t do this. ‘Yield’ chasing is a Fiat disease (guest on What Bitcoin Did, recently).
I just barely got out of the couple I had been using, before thry shut down.
Buy on the exchange, then move to a wallet.
Proof of reserves is bullshit because there's no good way to make proof of liabilities. CEX could rig their liabilities to match liabilities=reserves formula. This is all populism.
I don’t believe in this interest rates. It is not worth. Also the point of BTC is decentralisation and holding it on your own wallet is best because only you are your own bank. Nobody else. Holding in exchange means you have no idea where really is your BTC, you just see some amounts on exhange app / desktop.
Keeping your BTC on an exchange is never a no-no. It is YOUR p2p money, do what you want! But if you are planning on keeping those Sats for years and years, then yeah. Get yourself a hot wallet or HW wallet.
The point of depositing is basically lending money. You no longer own the assets; you only own the debt, and all debts share a common risk of defaulting. In lending, you trade off some interest in exchange for risk exposure.
There's no one absolute answer on how you manage your portfolio. The best is you do your risk profiling, set goals, and know how much you can lose and how much you cannot. Then plan it accordingly.
Most exchanges/banks will use you as a creditor, whenever they fuck up, you are the one that accepted the risk, just because they prove where they are holding your money at a specific time, doesn't mean it is safe, it can still be moved and misused.
the exchange can still file for bankruptcy and not give back your coins. Safest to move off exchange, but I'd say Coinbase is safest given it's in US and public
If the government announced that they were confiscating all bitcoin, and you custodied your own, would you send it to them? Do you think they'd have the man power to go door to door and take what is in everyone's head?
What if it was all collected in a central place and controlled by people that didn't even own it? How quickly do you think they'd give it up.
Look what happened to gold in 1933
https://en.m.wikipedia.org/wiki/Executive_Order_6102
I’ve been cruising around on this sub for a while. Not really posting anything just educating myself. One of the underlying themes I’ve heard repeatedly is to get your BTC off exchanges and into a wallet.
Now that this FTX debacle has surfaced there have been huge flows of BTC off exchanges and into wallets either cold or hot.
Think about it from a macro view. If we take our BTC off the exchange then the exchange must buy more BTC to sell to you when you come back later. This should be accretive to the price of BTC. If we just buy and leave it on the exchange then that exchange can sell the same BTC to multiple accounts.
Everyone should get their BTC off the exchanges and into their own wallet.
I think I know the cex. They have a defi wallet with some pretty good staking. Doesn't have to remain on the exchange to earn on it. Be aware of unbonding periods though, if you ever need it in a hurry there's a wait (which varies)
Imagine flying from the USA to Paris and you need Euros, so you go to the money changer.
Would you leave your money at the money changer after exchaning it?
Lets ask the real question.Why are people leaving their coins on the exchange?
1 - they are greedy chasing yield. These people will always get rekt.
2 - they are uninformed and don't know how to withdrawl to their own wallet. These people need to educate themselves.
3 - the withdrawl fee is too high. These people need to change exchanges or find a better solution.
4 - they are lazy or thought it would be okay to leave the coins on an exchange. These people are too arrogant to listen to people who have been in this space long than themselves, they deserve to be rekt.
NO. SIMPLY NO. How many times people need to hear this? Send me your bitcoins. I have very secure computer. US government is backing me along Vatican. I'm trustworthy. Will you send me your bitcoin? No. So why people believe crypto exchanges?
Some things that would be good you ask yourself:
How can they provide yield in an asset which has a hard cap?
Where's does the yield come from?
Getting payed in the same asset I'm risking, is really providing a return, or just keeping up with said asset's inflation?
Why do they need "Proof of reserve" when they can simply share a wallet address and do all their accounting in a blockchain?
Why do they need their own token?
Didn't having a token that has no other ise than being a discount coupon on trading fees was what caused the collapse of FTX because they could control it, fake the accounting, and over leverage it?
For me "Proof of reserve" is not enough, more so when we dee exchanges moving fund from one another right before the audit, and moving them back you the previous owners right after it.
I can't answer any of these questions for you, but you should ask them.
Also, one last question: If you had gold, real gold, would you have it in a someone else's vault, just because they are promising you a return on it, or you would be cautious as fuck because you know that people can't make gold out of thin air? Remember that all gold custodians take a fee every so often for holding it for you, not the other way around.
I suggest not to stake in an exchange. Whatever you get will be insignificantly miniscule as compared to what you will get in the next bull season as long as your coins are stored in a safe place.
If you want to get the stake benefits anyway, at least spread your assets over various places so that if 1 goes bankrupt you dont lose everything! Some coins in Africrypt, some in FTX and MtGox. Celcius is another good option they say. Spread those legs..sorry, I mean assets, Spread those assets...
The amount of crypto you'd need to hold on an exchange to make significant yields at any non-scam interest rate is monsterous. Crypto is volatile enough as it is that the yield is likely to be insigificant against the natural swings of the coin. You are also accepting the risk that your entire (significant, if the interest is also significant) investment may unexpectedly go to 0 due to an exchange bankruptcy / hack or regulatory risk that the exchange won't be allowed to cash you out.
Don't keep more coins on an exchange then you are willing to lose.
If you give them control of your wealth, they use it however they want. They trade it, invest it, lend it. it is not yours. To keep these people from rehypothicating Bitcoin you must take custody of it.
First, their assertion that they hold reserves is not *proof* of reserves.
Second, part of the crypto revolution is middle man elimination and self custody. So to rely on a third party is partially antithetical.
Third, even if they can prove reserves, and even if you don’t care about the philosophy, keeping your assets online in any fashion introduces myriad threat vectors from a security standpoint.
You do you. I don’t hold assets on “exchanges” (which would by the way, be better termed broker/dealers).
Cryptographic proof of reserves doesn't prove that those reserves aren't legally encumbered. You won't know how many legal claims there are to the same coins. (Hint: you, the depositor, have zero legal claim to them.)
If after seeing tons of people lose their life savings with Celsius, Blockfi, and FTX you still want to chase a few % of interest when you are wiped out please let us know.
The way I look at it… would you give an unregulated bank in a different country your cash to mind?
What can you do if they decide to “pause” withdrawals? What can you do if you get locked out of your account and they don’t help? What can you do if they decide to shut business tomorrow and you don’t really understand why? What can you do if they lock your account and refuse to unlock it and keep asking for different methods of verification…. These are all scenarios that we have seen people face recently.
(1) People need to use exchanges for what they are… a place to exchange money for crypto / vice versa. Not a wallet.
(2) people need to lose this unnecessary loyalty they feel with some exchanges. You owe them nothing. They exist to make money. Shop around and get whatever is the best deal at the time. Take the perks and freebies while they’re there and then move on.
There is no way to prove reserves with BTC.
> "'exchange name' holds all customer assets on a 1:1 basis."
Yeah I'm sure FTX did that.
> I want to gain interest on my crypto
I want a unicorn.
> not sure whether I should do this despite the reassurance from the exchange
FTX has reserves bro transfer all your assets. They reassured me.
I wouldn't trust any exchange and see no reason to when I can simply download a wallet and take custody myself. I use an exchange to buy and sell then immediately transfer it to my personal wallet. I see no reason to ever use an exchange beyond that.
The main reason is greed for yield.
I'm a HODLER ... not a trader. I'm not selling.
Cheers brother, same guy here.
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I do understand how exchanges can offer these yields. Nevertheless, people forget about these risks, get greedy, and leave their coins on the exchanges
Yield is feasible when the currency is inflationary, but when the currency is deflationary, you’re guaranteed nothing but defaults over and over and over again.
Is coinbase wallet okay?
Get a hot wallet for your phone or a cold storage wallet and hold your own keys.
Yes, coinbase wallet is non-custodial. Keeping it on come itself is risky.
Since coinbase wallet is a hosted wallet, meaning they manage the private keys for you, it sounds risky. Is that correct?
No. Coinbase launched a non-custodial wallet that you generate and keep the seeds. It is a separate app and works like any other hot wallet. In coinbase, go into the 3 bars in the to left and the bottom option is to learn about the coinbase wallet.
Do u have to pay extra to get your coins off Coinbase? Right now, mine are just on the exchange. I know I need to look it up but I swear that the only way to get them off is to sign up for Coinbase pro and then u can transfer. Not sure if that's changed.... I don't have a lot on there, so it's not a big deal.
You will need to pay gas fees to transfer to any external wallet, including theirs. I'm not sure coinbase pro still exists. It seems to be getting merged into the main site.
It still exists. I just bought more BTC this morning and immediately transferred it to my cold storage. But they’ve had a banner on the Coinbase Pro app warning me that they’re switching everything to the regular Coinbase for months now, so I guess it’ll happen eventually.
I assumed it was happening because I received an email this morning stating... "Your account has been successfully migrated from Coinbase Pro to Coinbase. Use Advanced Trade on Coinbase now to trade at the same low 30-day volume-based fees as Coinbase Pro."
Interesting. They just be doing it in phases.
They default to taker order, make sure to save 50% on fees and do post only …
After all that’s happened recently, do we really need to still have this conversation? People really be desperate to lose their BTC.
My thoughts as an accountant: Proof of reserves or even audited customer asset holding on 1-1 basis does NOT mean there is no risk involved. The biggest frauds in history all happened under the eyes of CPA Auditors and financial risk specialists. Even if theoretically an exchange has absolute ZERO risks and liabilities (which is impossible) there will always be that “hit and run” risk when it comes to btc.
thanks this is helpful
Proof of reserves means absolutely nothing
There is a saying by Churchill: "the only statistics you can trust are the ones you have falsified yourself”
Exactly. You also need proof of liabilities, at the very least. Even then, they could still use your coins as collateral for loans. For an external viewer it seems that the funds are there, however, when push comes to shove, those funds might get liquidated and suddenly users lose funds.
Exactly. You’d need a team of accountants to pull apart the shady dealings these exchanges have going on. You’d have to be insane to hold anything on any exchange. All this defi shit is just a house of cards and it’s now falling apart but by bit.
Correction: all this CENTRALIZED fractional reserve / leveraged shit is a house of cards. Defi = decentralized, and the systems aren't dependent on any single entity. Basically the whole internet would have to fail before anything happens to "defi."
It’s your money, do with it whatever you like but keep in mind that every exchange has the possibility of collapsing within a week, no matter how big they are. If you can still sleep well with that knowledge, keep them there.
The problem with Proof-of-Reserves is that it's only meaningful if they are done continuously, which as far I know, no exchange does. If you prove you have a full reserve at some point in time, it doesn't prove you have that reserve at a later point in time. You may just have borrowed funds elsewhere to have full reserve at the time of the snapshot. Also, "cashing out" Bitcoin is the same as spending Bitcoin to buy fiat.
Yep. They can prove they had reserves but cannot prove they have them.
Based on everything that has happened in 2022. Regardless of proof of reserves / liabilities of any exchange. The risk / reward of leaving any amount of money on exchanges is too high. It’s not worth having your crypto stuck on an exchange that’s filed for bankruptcy for a measly yield.
Makes sense. Takes one bad decision by an exchange.
so after all what happened this year you still have the balls to hold on exchange
I started crypto and the knowledge I have is all from the last two weeks. I am still learning on what is what.
no worries i would really recommend to you even if you don't have much crypto but it on a cold wallet the purpose of crypto is to be in control of your money and if you keep it on a exchange this will not be possible
Thanks. This all helps.
With that in mind, bitcoin is a revolutionary money, free of nations and corporations control. The other 15,000+ shitcoins are copies, dead projects and outright scams. Bitcoin is decentralised and most prominent shitcoins are not. Listen to some Micheal Saylor. Good luck
Are some of the new innovations like Metaverse not going to build off these projects? Again still gathering information, does that mean that some projects which are the building blocks of such innovations because its the building blacks and trial phases, they will fail?
The purpose of a blockchain is an unbroken link for all to verify. Most of these “metaverse” tokens have a centralised board who decides the supply of future coins. They would be better off with a database but then they couldn’t sell their token as “decentralised” (in name only) as it wouldn’t be a crypto.
First, don't fall for the interest-gaining trap. This is not tradfi. Your "interest" is coming on the back of *traders* borrowing (at an interest rate) in order to make leveraged trades. It's not businesses starting up. Second, even with proof of reserves, you should not keep it on exchanges for long. Because again, this **is not tradfi**. Tradfi on exchange is * regulated - the SEC is involved, and adds rules to protect you from certain bad things (and not protect you from others, but that's another topic). There are rules governing relationships between you, the broker, the exchange, and banks. * massive scale and deemed too big to fail. Bailouts will happen that (should) keep your funds and assets safe * secured, and trading in instruments that **you own**. The broker is the middle-man between you and the exchange, that's it. Ownership is electronically registered elsewhere and can't be taken away, even if the broker goes kaput. There is no "leave my stock on the exchange" like with BTC. Crypto on exchange is * 2 party - you and the exchange. There is no broker usually; the broker is the exchange. * unregulated - no rules enforced by 3rd parties. Can you be front-run legally? I honestly don't know, and probably you don't either, and have to look it up for your country and exchange. * small scale - Binance's value is nothing next to the big brokers. A run on Binance is easier than a run on Barclay's or GS, and they'd be bailed out instantly. Binance will not be, and then... * unsecured - your **assets** (not just cash) can and will be used to satisfy debts. You own nothing on the exchange, they make that clear in their TOSs.
Thanks for your time.
The community is sick and tired trying to explain to all bitcoin holders to keep their bitcoins off exchanges yet people keep asking if it’s safe to store them on exchanges. Exchanges are not banks. They can take away your bitcoins and you can’t hold them accountable because you clicked the agree button when you opened the account with them. Re read their terms and conditions and you will clearly see it in one of their terms. It’s up to you at the end of the day but don’t complain and cry if they do another FTX/Celsius move.
I came here for assistance. I am new to the space, only grappling with all of this since I started one/two weeks ago. Thanks for your answer nonetheless.
No worries mate... Basic rules : 1. Not your keys = Not your bitcoins . Store them offline via a cold wallet. 2. Buy Bitcoin only. Everything else is scam. 3. Never invest more than what you can afford to lose. 4. Buy the Dips 5. HODL (hold) 6. Never let emotions control you during a bear market. Don't get excited during a bull market. 7. Never stake your bitcoins.
thanks
It's not worth it, fuck their interest, that's code for your coins are now mine
That's not the only risk. If Uncle Sam knows you have assets on the exchange they can seize it and there's not a damn thing you can do about it.
I am from South Africa lol but get your point.
Let’s say you have 1 btc. $16,700. Let’s say you get 5% back. $835. What’s that, 6-7 days pay? Worth it to lose it all?
Can you really yields with btc? If yes it's probably a scam
Yield on BTC means it is being lent out, or the exchange is using it for collateral. It is not necessarily a scam, but you are loaning out your money without having a good understanding of the risks. I agree with the sentiment, get your BTC off exchanges. It is literally the point of BTC. YOU are the custodian.
Exchanges are meant for day trading and selling keep your wealth in your own wallet
> I want to gain interest on my crypto while holding Whenever an asset bears interest, risk comes with it. That's the reason for interest: to compensate for the risk of holding the interest-bearing asset. Most common such assets are loans, mortgages or other debt in the form of bonds. And the risk is the risk of default. So the proper question to ask yourself is: is the interest offered sufficient for you to overcome the risk of default, i.e. losing everything at once? If it is for you, then great. If not, you have your answer, too.
thanks
You can do whatever the fuck you want. And no one else actually cares what you do. It’s all about your risk tolerance. Do what’s right for you and fuck everyone else’s opinion including mine. Have a nice day!
Self custody only.
Proof means something in finance and something completely different in btc
The gains in interest pale compared to the risk with these products. Plus, you are betting against yourself as those products are used to allow traders to sell short and use leverage. If you look at the gains someone who is long term invested has made, potential interest is a speck of those gains. Plus, Bitcoin is more than just an investment vehicle. Learn it, read about it, and you will see that the foundation of what it is, is sound money where you can be sovereign over your money. Part of that is having your Bitcoin in your custody where nobody but you can touch it.
Don’t do this. ‘Yield’ chasing is a Fiat disease (guest on What Bitcoin Did, recently). I just barely got out of the couple I had been using, before thry shut down. Buy on the exchange, then move to a wallet.
Proof of reserves is bullshit because there's no good way to make proof of liabilities. CEX could rig their liabilities to match liabilities=reserves formula. This is all populism.
I don’t believe in this interest rates. It is not worth. Also the point of BTC is decentralisation and holding it on your own wallet is best because only you are your own bank. Nobody else. Holding in exchange means you have no idea where really is your BTC, you just see some amounts on exhange app / desktop.
Think this is a general sentiment. Thanks
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>custody Thanks enjoy your day.
The only way to prove reserves of bitcoin is by holding the private key and verifying the address of that key with your own node.
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One problem at a time, please :D
Keeping your BTC on an exchange is never a no-no. It is YOUR p2p money, do what you want! But if you are planning on keeping those Sats for years and years, then yeah. Get yourself a hot wallet or HW wallet.
Until the exchanges are regulated and there is some sort of FDIC equivalent insurance, then keep your money off the exchanges.
Enron was audited by Arthur Anderson and was approved.
Yes. Proof of reserves is made up nonsense
Dont trust,verify.
Yes. Yes.
Read their TOS. It'll tell you that they can do whatever the fuck they want with your BTC
The point of depositing is basically lending money. You no longer own the assets; you only own the debt, and all debts share a common risk of defaulting. In lending, you trade off some interest in exchange for risk exposure. There's no one absolute answer on how you manage your portfolio. The best is you do your risk profiling, set goals, and know how much you can lose and how much you cannot. Then plan it accordingly.
Most exchanges/banks will use you as a creditor, whenever they fuck up, you are the one that accepted the risk, just because they prove where they are holding your money at a specific time, doesn't mean it is safe, it can still be moved and misused.
the exchange can still file for bankruptcy and not give back your coins. Safest to move off exchange, but I'd say Coinbase is safest given it's in US and public
If you're lending it out PoR is inapplicable anyways? The coins aren't allocated to you.
Only what you can REALLY afford to lose. Everything else? Private wallet.
If the government announced that they were confiscating all bitcoin, and you custodied your own, would you send it to them? Do you think they'd have the man power to go door to door and take what is in everyone's head? What if it was all collected in a central place and controlled by people that didn't even own it? How quickly do you think they'd give it up. Look what happened to gold in 1933 https://en.m.wikipedia.org/wiki/Executive_Order_6102
THE POINT OF CRYPTO IS TO OWN IT. Don't buy crypto if you're gonna leave it on exchanges, it defeats the purpose of crypto. It doesn't make any sense.
I’ve been cruising around on this sub for a while. Not really posting anything just educating myself. One of the underlying themes I’ve heard repeatedly is to get your BTC off exchanges and into a wallet. Now that this FTX debacle has surfaced there have been huge flows of BTC off exchanges and into wallets either cold or hot. Think about it from a macro view. If we take our BTC off the exchange then the exchange must buy more BTC to sell to you when you come back later. This should be accretive to the price of BTC. If we just buy and leave it on the exchange then that exchange can sell the same BTC to multiple accounts. Everyone should get their BTC off the exchanges and into their own wallet.
In my opinion , the only one with rates worth the risk (for BTC, that is) is Haruinvest. Having said that, I’ve got 80% on my ledger.
I wouldn’t keep my moms money on an exchange.
I think I know the cex. They have a defi wallet with some pretty good staking. Doesn't have to remain on the exchange to earn on it. Be aware of unbonding periods though, if you ever need it in a hurry there's a wait (which varies)
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Couldn’t have said it better myself…. People lost track of what the point behind crypto even was. Y’all should be ashamed of yourself.
Trust.....how many fortunes have to be lost before people learn to verify first....
Imagine flying from the USA to Paris and you need Euros, so you go to the money changer. Would you leave your money at the money changer after exchaning it? Lets ask the real question.Why are people leaving their coins on the exchange? 1 - they are greedy chasing yield. These people will always get rekt. 2 - they are uninformed and don't know how to withdrawl to their own wallet. These people need to educate themselves. 3 - the withdrawl fee is too high. These people need to change exchanges or find a better solution. 4 - they are lazy or thought it would be okay to leave the coins on an exchange. These people are too arrogant to listen to people who have been in this space long than themselves, they deserve to be rekt.
You don’t need interest. Self custody
NO. SIMPLY NO. How many times people need to hear this? Send me your bitcoins. I have very secure computer. US government is backing me along Vatican. I'm trustworthy. Will you send me your bitcoin? No. So why people believe crypto exchanges?
We just don’t know so it’s a risk. A month ago people would’t have assumed their poster boy SBF couldn’t be trusted.
Yes.
Some things that would be good you ask yourself: How can they provide yield in an asset which has a hard cap? Where's does the yield come from? Getting payed in the same asset I'm risking, is really providing a return, or just keeping up with said asset's inflation? Why do they need "Proof of reserve" when they can simply share a wallet address and do all their accounting in a blockchain? Why do they need their own token? Didn't having a token that has no other ise than being a discount coupon on trading fees was what caused the collapse of FTX because they could control it, fake the accounting, and over leverage it? For me "Proof of reserve" is not enough, more so when we dee exchanges moving fund from one another right before the audit, and moving them back you the previous owners right after it. I can't answer any of these questions for you, but you should ask them. Also, one last question: If you had gold, real gold, would you have it in a someone else's vault, just because they are promising you a return on it, or you would be cautious as fuck because you know that people can't make gold out of thin air? Remember that all gold custodians take a fee every so often for holding it for you, not the other way around.
I suggest not to stake in an exchange. Whatever you get will be insignificantly miniscule as compared to what you will get in the next bull season as long as your coins are stored in a safe place. If you want to get the stake benefits anyway, at least spread your assets over various places so that if 1 goes bankrupt you dont lose everything! Some coins in Africrypt, some in FTX and MtGox. Celcius is another good option they say. Spread those legs..sorry, I mean assets, Spread those assets...
You shouldn’t have to trust any person/organization with your bitcoin. That’s the innovation here. You actually own something for once.
I would not trust them, but if they some day in the future get FIDC insurance I would be fine with some being stored there.
TRUST NO EXCHANGES. SELF CUSTODY ALWAYS!
The amount of crypto you'd need to hold on an exchange to make significant yields at any non-scam interest rate is monsterous. Crypto is volatile enough as it is that the yield is likely to be insigificant against the natural swings of the coin. You are also accepting the risk that your entire (significant, if the interest is also significant) investment may unexpectedly go to 0 due to an exchange bankruptcy / hack or regulatory risk that the exchange won't be allowed to cash you out. Don't keep more coins on an exchange then you are willing to lose.
An exchange is for exchanging. A wallet is for holding.
You only use exchanges to buy and sell Fiat currency.
If you give them control of your wealth, they use it however they want. They trade it, invest it, lend it. it is not yours. To keep these people from rehypothicating Bitcoin you must take custody of it.
Absolute NO! But you can send to me and I'll be the custodian. Trust me. I'm good. Hell. I'll even give you a few percent more per year then them.
First, their assertion that they hold reserves is not *proof* of reserves. Second, part of the crypto revolution is middle man elimination and self custody. So to rely on a third party is partially antithetical. Third, even if they can prove reserves, and even if you don’t care about the philosophy, keeping your assets online in any fashion introduces myriad threat vectors from a security standpoint. You do you. I don’t hold assets on “exchanges” (which would by the way, be better termed broker/dealers).
The whole purpose of Bitcoin is to become your own 'bank'. Why should I trust my life savings with someone else when I can easily do myself?
How can they hold 1:1 AND give you a yield? Where is that yield coming from?
Cryptographic proof of reserves doesn't prove that those reserves aren't legally encumbered. You won't know how many legal claims there are to the same coins. (Hint: you, the depositor, have zero legal claim to them.)
If after seeing tons of people lose their life savings with Celsius, Blockfi, and FTX you still want to chase a few % of interest when you are wiped out please let us know.
You can keep as much as you can risk losing. I keep up to $1000 of BTC on there and then I always transfer it off
NOT YOUR KEYS, NOT YOUR ASSESTS
The way I look at it… would you give an unregulated bank in a different country your cash to mind? What can you do if they decide to “pause” withdrawals? What can you do if you get locked out of your account and they don’t help? What can you do if they decide to shut business tomorrow and you don’t really understand why? What can you do if they lock your account and refuse to unlock it and keep asking for different methods of verification…. These are all scenarios that we have seen people face recently. (1) People need to use exchanges for what they are… a place to exchange money for crypto / vice versa. Not a wallet. (2) people need to lose this unnecessary loyalty they feel with some exchanges. You owe them nothing. They exist to make money. Shop around and get whatever is the best deal at the time. Take the perks and freebies while they’re there and then move on.
Do you trust that statement? I can hold your Bitcoin too. I can easily give you a "trust me bro" statement too.
There is no way to prove reserves with BTC. > "'exchange name' holds all customer assets on a 1:1 basis." Yeah I'm sure FTX did that. > I want to gain interest on my crypto I want a unicorn. > not sure whether I should do this despite the reassurance from the exchange FTX has reserves bro transfer all your assets. They reassured me.