Is the security of exchanges and wallets sufficient?

[Darker45]

There may be a point at which any cryptocurrency (whether Bitcoin or another) is held on exchanges/wallets run by small/new companies.

How so? I mean, why do you think that such a point will occur?

If it cannot be avoided that you use an exchange, just make sure you are choosing one from among the top and most trusted. And also make sure you are not keeping your coins there. The moment you're finished with your business, pull out your coins and keep them in a storage under your sole control.

The small players have limited resources. How do they ensure they are sufficiently protected? Why don't there be hacks every other day?

Having limited resources is in fact the very reason why small players will have to protect what little they have at all cost. If it means they need to buy a hardware wallet, then they should do it. If a hardware wallet is too expensive for them, there are open-source non-custodial wallets out there that are for free. They just have to make sure they are downloading them from the official sites. They should also make sure they are keeping their seed in a very safe place outside the access of anybody else. In other words, they need to be careful in every step of the way.

Hacks do not happen everyday. A cold wallet or an open-source non-custodial wallet, careful verification in every transaction, safekeeping of password and PIN and seed, and so on will reduce the risk of getting hacked to the minimum.

[ultrloa]

It's true that 'not your key, not your coin', and that there are several wallets and services available to cover yourself.

There may be a point at which any cryptocurrency (whether Bitcoin or another) is held on exchanges/wallets run by small/new companies.

The small players have limited resources. How do they ensure they are sufficiently protected? Why don't there be hacks every other day?

No exchange is safe, the scammers are getting better even if they have tight security there's always a possibility of getting hacked, you should never make exchange wallets as your storage, only put coins that you will trade and only trade on Big and reliable exchange so even if there is an incident of hacking, the exchange will cover all their trader's coin's and even if they guaranty your coins is safe, still don't go for their service you should be the one responsible for your coins.

No exchange is safe but there is lesser risky among them so we should stay on that one but even though they are top still we shouldn't put any huge amount which can hurt us badly when things comes in bad position, we should always think about withdraw the profit always we take on the exchange and store it on hardware wallets since putting it there will really give us huge risk on what you said hacking or maybe an inside job incidents.

[Kyraishi]

It's true that 'not your key, not your coin', and that there are several wallets and services available to cover yourself.

There may be a point at which any cryptocurrency (whether Bitcoin or another) is held on exchanges/wallets run by small/new companies.

The small players have limited resources. How do they ensure they are sufficiently protected? Why don't there be hacks every other day?

Exchanges are definitely not a good place to store your funds long term.

"Not your key, not your coin" is a mantra that has been time tested and every time there has been a hack, this should have been applied beforehand.

Whilst I agree that people will inevitably have to use exchanges/hosted wallets sooner or later, they can minimize this risk by withdrawing periodically and sweeping the coins into a wallet that they actually own.

[TheUltraElite]

There may be a point at which any cryptocurrency (whether Bitcoin or another) is held on exchanges/wallets run by small/new companies.

Why so? It has never been the objective from the bitcoin community to endorse such practices. You said it yourself in the previous line. If you have any reason to think otherwise, do let us know.

Why don't there be hacks every other day?

Hacking is not a get-rich-quick scheme. A skilled hacker spends a lot of time observing, collecting data and on reconnaissance.

You dont jump the bank on any day you feel like do you? unless you are an idiot. You would want to know what security measures are in there, how much the loot is worth and how to cover yourself.

Hence you dont see hacks happening everyday, but that does not mean that hackers have stopped working. You have to keep yourself secure to avoid getting hacked. Major big exchanges usually get hacked because these are targets that can yield maximum money.

[shield132]

It's true that 'not your key, not your coin', and that there are several wallets and services available to cover yourself.

There may be a point at which any cryptocurrency (whether Bitcoin or another) is held on exchanges/wallets run by small/new companies.

The small players have limited resources. How do they ensure they are sufficiently protected? Why don't there be hacks every other day?

Depends on the person. There are some people who lost access on their coins multiple times despite the fact that they had control on their keys and for these type of people, exchanges are really better options.

Overall, refund in case of hacks, depends on the exchange. I guess as  serious exchanges as Binance and Coinbase are, will refund you in case something happens and as I have heard, Binance was also refunding money to those who were liquidated because of Binance's error (those who set stop loss order and it wasn't activated). I remember cointelegraph was writing something like that.