Kraken CEO Recommends Storing No More Coins Than Necessary on Exchange Wallets
The attack experienced by the Cryptopia exchange has been generating controversies among the cryptocurrency community.
For example, Changpeng Zhao the CEO of one of the most popular crypto exchanges, Binance, has been criticized for saying that users can store funds in exchanges that have proven secure. Kraken CEO has also commented on this issue saying that users should not store in exchanges more cryptos than what they need to actively trade.
Changpeng Zhao wrote about it that coins should be stored always be users. However, he explained that computers can break down and USBs with information about virtual currencies can get lost as well. Several times happened that users were storing their private keys in computers that broke down or were just thrown away.
He said that it is also possible to store funds on exchanges but use just the most reputable platforms in the space. During the last several years, a large number of exchanges has been affected by hacks and attacks from malicious individuals and groups.
He then mentioned that decentralized exchanges (DEX) could be a good way to store virtual currencies. Nevertheless, these exchanges are not so developed as centralized platforms.
Kraken CEO, Jesse Powell, advised users not to store digital currencies on exchanges if they will not be actively trading them. Instead, cryptocurrency owners should use hardware wallets including Ledger and Trezor.
Additionally, Powell has also criticized decentralized exchanges mentioning that exploits will be discovered sooner or later and not necessary by good individuals.
PLEASE do not store more coins on an exchange (including @krakenfx) than you need to actively trade. Use @LedgerHQ or @Trezor. DEXes are not a panacea — look at The DAO. Open source just means exploits will be discovered sooner (probably not by good guys). 🙏 https://t.co/LmzhtCjpM0
— Jesse Powell (@jespow) January 16, 2019
Coincheck, Mt. Gox, BitGrail, and Cryptopia are just some of the most popular crypto exchanges hacked during the last few years. More than $900 million from cryptocurrency exchanges have been stolen from exchange platforms in the last 2 years.
Alena Vranova, the former CEO of Trezor mentioned that cryptocurrency investors should reduce their risk exposure by controlling their private keys. This can be done through cold storage wallets, including hardware and paper options.