Bitcoin Forum

A friend who just started using crypto asked me if it's ok to have his Bitcoin and USDT on Binance or other exchanges for a long time. He was worried about safety, government issues, and whether it's better to move his crypto to a personal wallet.
Honestly, I didn't have a clear answer for him, so I thought to ask here.

Do you leave your crypto on exchanges or do you move it immediately?

What risks should people in Nigeria consider when deciding?

Is there any safety to use for exchanges or wallets?

I believe, your advice will not just help him but others here too who may have the same question.

Be it CEX or DEX it's not fine to leave your coins on an exchange because that way you don't control them since most times you don't have the keys and for the ones that give you keys it's still not fine since you are not the only one with access to those keys. They are called exchanges because you use them for exchanges and trading as the case may be but never are they fit for a hodling wallet.

As for wallets, when you choose a wallet choose an open source wallet avoid working with custodial wallets and some that use KYC verifications. Mostly importantly don't forget to keep your keys safe (brute forcing seeds is a nightmare).

Basically, the term "not your keys Not your coins" works more on issues like this, now you have to know that you only have passwords or whatsoever that they may offer you as key but true control is in there hands o you have to be aware that it's not safe no matter the kind of exchange, Decentralised open source exchange or centralised closed source none is safe for a long term holding! it's only safe for a short period of time especially when you do business that requires in and out so you can't use your cold wallet for all that instead you can use hot wallet and exchanges since it's an immediate use.

Thanks for your insight🙏. Many people don’t realize exchanges can freeze or lose funds anytime. It’s safer to move coins to your own wallet and protect your keys.

But do you think it’s better to use a hardware wallet or a mobile wallet for holding long-term?

Well it depends on the purpose of the money and how reputable that exchange really is. If it's funds you intend to hold for a long time then it's absolutely unsafe to hold your funds in an exchange, whether it's a reputable exchange or not. The only situation I'd advise leaving funds on a Centralised exchange is if it's funds that you have very short term plans for, or money you intend to use pretty soon, and you should make sure in that it's actually a reputable exchange. Other than this, it'll be a very foolish choice to want to leave funds on an exchange.

Nope, this na one of the don’t and to make it even personal, na something way I no Dey do. The most o Dey use exchanges for na for trading and p2p.

Exchanges although, we get Decentralized exchanges as well but the most and very popular once are the centralized exchanges which are liable to every form of regulation. Nigerian government Dey like this kind thing, when them fell say, them need collect from these guys, them go just come up with something, like them do Binance and just like that, your KYC documents and just anything way them find value in is up for grabs.

Exchanges are as safe as the developers make it with very little you can add to it, 2FA and not clicking just any link. This doubles for your wallet too because, if your device is phished, it doesn’t matter how safe anything for that device is, it could be hacked.

When choosing where to save your cryptos or Bitcoins, chose none custodian wallets or even, go for hardware wallets.

Exchange by definition is meant to exchange which also mean that anything that is inside must be taken out at the same time when the balance appears.

If you fit afford hardware wallet then by all means get am but if your pocket dey small you fit dey use mobile wallets like Electrum for storing bitcoin and Unstoppable wallet to accommodate different cryptocurrencies. Nothing dey wrong with using mobile wallets as long as you sabi wetin you dey do.

Op I advice make u too keep eyes down as others dey drop their opinions for here and believe e go also help u because of u really know the risks behind keeping it funds for exchange u for don let ur friend know am or u for no even bring am up here.
So the Koko be say exchange no good to store values for too long because the security network dey very poor to withstand some kind serious internet attacks and the custodian risk be say u as individual no dey completely full control of your private keys but the operative authorities.
So tell ur frnd to transfer em funds to the custodian wallet network where em funds go dey well safer for am cus there na only em go dey control the funds with full time of private and security keys.

I think the best possible solution is utilizing a hardware wallet or a personal wallet as they can be used for long term. Exchanges have access to your keys and your account can be restricted at any point in time depending on the inflow and outflow which can be unsafe and discomforting.

Cryptocurrency security depends on your usage style or caution. Crypto centralized, means it is not safe to keep it on any exchange. If you are planning for the long term, it is wise to collect your own wallet. remember that you do not have the keys, means you do not have any crypto. the main purpose of creating cryptocurrency is freedom, a person will control their own money, withdraw it whenever they want or send it to someone, and there will be no need to recommend it to a third party. From my point of view, you should keep a very small amount of crypto on an exchange, keeping crypto on an exchange means that it is completely out of your control. exchangers rules can change at any time and can be hacked or bankrupt at any time. having your own wallet is very important to keep your crypto safe.

this depends on the individual priorities and what they do with their crypto on a daily.
a day trader can leave their crypto on the exchange since they trade daily.
but the case of your friend is different from that of a day trader, so he should hold his bitcoin in his personal wallet.
I advice people about not-your-keys, not-your-coin and yet i have held a particular coin on binance for over 5 years. the coin is still there, and binance is still there. not everyone practices what is preached online but the most important thing is willingness to accept the consequences of your action.

When you keep funds for exchange, you no dey in control of the funds, nah the exchange hands e dey. So to answer your question, e no dey safe to keep funds for exchange because you go fit lose your funds if the exchange go bankrupt, get hacked or the government shut am down. Instead use a non-custodial wallet to keep your funds safe and only move your funds to exchange when you wan trade.

No and never try this, under wallets, we have custodial wallets and non custodial wallets, try to read them and know the difference and why you should avoid centralized exchanges under a custodial wallet, to push further, why not take your time in going through this thread

Understanding CEX and DEX
https://bitcointalk.org/index.php?topic=5447152.msg62015622#msg62015622


I may use the exchanges in buying bitcoin, but once this is achieved, then i moved immediately my personal wallet, which is a non custodial wallet.


KYC challenges
Not your keys not your coins
Government regulations
Exchange Hacks and attacks
Data leakage form Exchanges
No freedom and privacy


Decentralized exchange recommended

https://bisq.network/
https://hodlhodl.com/

wallets for security and privacy
Bitcoin Core (https://bitcoincore.org/en/download/)
Passport (https://foundationdevices.com/passport/)
Electrum (https://electrum.org/)
Sparrow (https://sparrowwallet.com/)
Bluewallet (https://bluewallet.io/)

My brother, leaving your hard earned money or assets in an exchange is like leaving your valuables in an open space which automatically anything can happen to it without no body to be heard responsible . However, Make sure you transfer your funds to your non custodial wallet to have your peace of mind and to avoid story that touch.

Preferably it's adviced to transfer Bitcoin or USDT to an individual wallet when you are holding long-term. Allowing crypto on exchanges such as Binance holds risks—your money can be frozen, lost in hacks, or disturbed by government crackdowns, mostly in Nigeria. Holding an individual wallet, you are in control of your private keys and secure your assets. Exchanges are preferred with trading or short-term use, but not adviced for savings. This is the rule: "Not your keys, not your coins." For stronger security, use trusted wallet, and make sure to always back up seed phrase.
By so doing your crypto remains in your possession and not someone else's system.

We don discuss this matter well well for this forum, and the first thing wey most people dey learn once dem join bitcointalk na "not your keys, not your coins", do not fall under the illusion that some exchanges are too big to fail. It is important to have cryptocurrency knowledge before acquiring it, if your friend had, then he would not ask you such a question as this, and at this point i would advise that he pause and learn about crypto security, so he does not make any mistakes in the future.

To be frank not safe to hold your con on exchanges, “Not your keys, Not your coin “ . Especially when you planning to hold for long, but you can choose to keep it on exchanges first while accumulating maybe when you have gotten some nice amount or some nice quantity of that token he or she is planning to hold , then the folk can transfer the token to their personal wallet just to reduce fees . But remember that even in your personal wallet your coins not completely safe because with carelessness you can lose it all that’s why he or she had to be mindful of their seed phrase or private keys .

Keeping your Bitcoin or any of your crypto asset in an exchange is a very dangerous risk you need to avoid because if the exchange is hacked, just know that their is a higher probability that your asset will be stolen. We saw what happened to FTX a few years back and how investors lost their asset even though they are trying to pay everyone gradually, but that is a risk we can easily avoid if we store our asset in a self custodian wallet where only us have access to it, because in an exchange, you dont have the key to it, and they are exposed to hack, so it's an avoidable risk.

No exchange is ever a good choice for long-term holding. Basically, exchanges are centralized which is the biggest problem for holding. They can control your wallet without your permission and they can store your information. The main purpose of using crypto is to have only your own control and privacy over your assets, this is not possible in exchanges. Choose decentralized wallets for long-term holding and ignore those wallets if they are associated with Google. For example, Trust Wallet.
Keep the seed phrases for controlling the wallet in a safe place and keep them under your control. Losing your keys means losing the wallet.

There are some other important tips about crypto that I think are definitely important for you to read.
Link: Best advice about cryptocurrency. (https://bitcointalk.org/index.php?topic=5545189.msg65430809#msg65430809)

Saving Bitcoin on other exchanges is quite a risky one especially for a long period of time because this exchanges most times are being controlled by government and other conditions its essential to note that   exchanges are  not sustainable enough to hold a huge asset for a long time and also they can be easily hacked .

Also your account can also be controlled by the exchange   thereby causing a restriction and  you being unable to access your funds at will  so I really do not like my usdt on an exchanges for a long period of time

First, you need to understand what an exchange is. An exchange is an online platform where all types of cryptocurrencies can be bought or sold, fiat to cryptocurrency, coin to coin and any crypto to fiat. It is like a local store. You go to the store, pay and purchase the product. Similarly, if you deposit money on an exchange, you can buy any coin of your choice.

If you deposit your money at your local store, the storekeeper has control over that money. Similarly, if you deposit Bitcoin on an exchange, the company has full access to it. So they can control your wallet without your permission.

But the main purpose of using crypto is financial freedom, complete control and privacy of your money. Which is never possible on an exchange. For long-term holding, decentralized wallets should be used.

The seed phrases for controlling the wallet should be kept in a safe place and under your control. Because we believe, Not your keys, not your coins.

NB: This is to clear any kind of possible misconceptions.
Now when talking about hardware wallet one have to be very open minded. Apart from the fact that is isn't beginners friendly and also that it is expensive, one should also note that it isn’t perfect(No wallet at all is 100% foolproof). Like any electronic device, hardware wallets can malfunction, get damaged, or even get lost or stolen. And also, if one forgets or  misplaces his/her recovery seed, the whole funds is gone, there is no “reset password” button.

That is why the main focus of every traders shouldn't just be on reliable and perfect wallet like the hardware wallet or a personal wallet but also on properly backing up his/her wallet’s seed phrase, coz your seedphrase is the real key to your funds

No, leaving your coins in the exchange is not safe because you are not the only one that have the key to the coins in that exchange, you can transfer coins to exchange if you want to sell to make funds from the coins because there are different buyers and sellers in the exchange market, and they are ready to receive different currencies you want from the transaction, If I don't want to resell the coins I bought from the exchange, I will immediately move them from exchange to my personal wallet where only me have the key to the wallet and the coins, I have heard some people said they have leave their coins in the exchange for few weeks or month before selling them off and nothing happen to their coins, but I will not advice you to leave your coins more than a day in your exchange before you can sell.