Are Exchanges Safer than Holding Your Own Private Keys?

By Mark Lemon – Cryptocurrency Professional

All our precious digital data is seen but never felt or touchable, why not money too? People do not keep all their money to hand all the time. Even when money is kept in the banks, someone else has taken charge of the care of your funds.

The CEO of cryptocurrency exchange Binance, a major cryptocurrency trading platform for users with a bit of experience in buying bitcoin and other cryptocurrency, Changpeng Zhao has voiced his opinion on storing digital assets. He has recommended that for most, holding digital assets on exchange is a safer option in terms of securing them.

He believes that most users new to the space are not able to secure the private from themselves losing it. This could be in hopes that Zhao is able to build confidence in users storing cryptocurrency on his exchange. If users begin storing more assets on exchange, they would be able to buy and sell cryptocurrency with faster access to the markets.

In opposition to Cryptocurrency

The co-founder of Ethereum, Vitalik Buterin, opposed this thought of Zhao. In this regard, if the users acknowledge their responsibilities towards the protection of their keys, they may take more care securing them. Moreover, the unprofessional conduct of keys is not the responsibility of the system maker. He suggested the idea of Social recovery. This means trusted people can have some allotted keys and the combination of these can permit the recovery, although this again increases the chances of fraud and mistrust.

You can observe that cryptocurrencies can correlate with hacking due to their anonymous nature. Hackers are in search of bigger opportunities in which centralized exchanges are a target. Though a theft of more than 7,000 Bitcoin has been faced in the past, the worst scenario is the irreversible transaction process or the loss of a large Bitcoin purchase.

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