Stop Saving Your Bitcoin (and other crypto) Addresses In Exchanges And Wallets

[DaveF]

Stop Saving Your Bitcoin (and other crypto) Addresses In Exchanges And Wallets
Period. Full Stop. End Of Line.

Wallets are lost.
Other exchanges you may have sent to in the past have closed or changed receiving addresses.
And again we see something like this happen.

https://bitcointalk.org/index.php?topic=5476264

Not your keys not your coins. And not an address you have access to not your coins.

With more and more exchanges shutting down and the constant hacks against them using saved addresses is just going to cause loss of access to coins more and more.

And if you sent to your own wallet, don't save the address.
Address reuse is bad for privacy anyway but beyond that if you loose access to that wallet for whatever reason do you even want the possibility that you can sent to it by mistake at some later time?

The coins you save may be your own.

-Dave

[UchihaSarada]

Other exchanges you may have sent to in the past have closed or changed receiving addresses.
And again we see something like this happen.

Changed receiving address like this one from Binance months ago.
Existing Deposit Addresses to Be Retired (2023-04-18).

Other exchanges can do the same too.

[Z-tight]

https://bitcointalk.org/index.php?topic=5476264

I'm following this topic, sad for the op because i think they have lost their funds, except LocalBitcoins decide to give it back, but that is very unlikely. I think the op of that thread uses exchange wallets to store their funds, because he moved the funds from Bittrex which just recently shut down, into LocalBitcoins, which they didn't know already shut down months ago.

Do not store your funds in an exchange wallet, and also don't move a large sum of money into an exchange address at once, you can break it down into smaller chunks. Even if the exchange is still in operation and they haven't changed their deposit address, they could confiscate your funds for any other reason at all, so sending funds in smaller chunks might save you from losing everything.

[_act_]

Stop Saving Your Bitcoin (and other crypto) Addresses In Exchanges And Wallets
Period. Full Stop. End Of Line.

The way you wrote it can be confusing. I later know after I read what you wrote that you are talking about not to save exchange or wallet address somewhere because the address can be changed by the exchange or wallet.

If it is custodial wallet, you are right. But if it is noncustodial wallet, it is your key and there use nothing that will change it. But not all wallets are noncustodial, some wallets are custodial.

But it is not good for anyone to use a custodial wallet, noncustodial wallet should be used.

[philipma1957]

and to all a trezor.io is cheap

put your coins in it

or any other good hard wallet.

[Bitstar_coin]

I think this has been stressed enough for people to already know that storing btc in an exchange wallet is not just a bad idea, it is a terrible idea.
Even though some of the big exchanges may claim that customers' funds are safe, it is better to be safe than sorry. If any hack happens to an exchange, they won't compensate you quickly because of the various process that is involved, in the meantime, you are losing out on opportunities, and there is a possibility not the full amount will be compensated.
People should already learn and understand the huge risk involved in keeping their funds in any exchange regardless of how secure they claim to be. Not your key, not your funds PERIOD.

[Zaguru12]

If it is custodial wallet, you are right. But if it is noncustodial wallet, it is your key and there use nothing that will change it. But not all wallets are noncustodial, some wallets are custodial.

I think OP was actually addressing both custodial and non custodial wallets. Concerning the custodial wallet he describes the use risk of address reuse by which exchange can change the address anytime. But concerning the use of non custodial wallet OP’s warning is about saving addresses somewhere and later sending to an old address that you don’t currently have access to. This lack of access can be as a result of it already been comprised or you lost the keys.

I think that’s what this paragraph by OP meant

And if you sent to your own wallet, don't save the address.
Address reuse is bad for privacy anyway but beyond that if you loose access to that wallet for whatever reason do you even want the possibility that you can sent to it by mistake at some later time?

[DaveF]

and to all a trezor.io is cheap

put your coins in it

or any other good hard wallet.

That is still and IF and only IF you know 100% that you will always be using that same device / recovery phrase.
You (not you you the generic you) decide for whatever reason to stop using the trezor and go to a different device and start fresh.

A couple of years later you do an exchange on some exchange you have been using for years. In -> exchange -> out quick and done.

But on the out you used an old saved address by mistake. It happens, we are human, we make mistakes. And instead of the new address from the new device you sent it to the old address from the old device.  Do you still have access to it? Does it still work? If not did you keep the seed? And so on. Or something like the issue that happened in to the user in the link in the OP and so on. It takes no time to enter a new address. And it's better for privacy. But, for some reason people keep saving old addresses places and then bad things happen.

-Dave

[alastantiger]

Not your keys not your coins. And not an address you have access to not your coins.

With more and more exchanges shutting down and the constant hacks against them using saved addresses is just going to cause loss of access to coins more and more.

Again, those that may be relying on an exchange to keep your coins secure maybe they trust them more than they trust themselves or maybe they haven't gotten around to taking their keys or their coins off of the Exchange just yet should know that you don't want to store your coins on an exchange because exchanges even the big ones get hacked all the time. Exchanges and accounts on exchanges are hacked all the time, they make exit scams, they go bankrupt they disappear and sometimes they get in trouble with the law and sometimes governments seize funds.

[philipma1957]

and to all a trezor.io is cheap

put your coins in it

or any other good hard wallet.

That is still and IF and only IF you know 100% that you will always be using that same device / recovery phrase.
You (not you you the generic you) decide for whatever reason to stop using the trezor and go to a different device and start fresh.

A couple of years later you do an exchange on some exchange you have been using for years. In -> exchange -> out quick and done.

But on the out you used an old saved address by mistake. It happens, we are human, we make mistakes. And instead of the new address from the new device you sent it to the old address from the old device.  Do you still have access to it? Does it still work? If not did you keep the seed? And so on. Or something like the issue that happened in to the user in the link in the OP and so on. It takes no time to enter a new address. And it's better for privacy. But, for some reason people keep saving old addresses places and then bad things happen.

-Dave

There are lots of ways to lose coins. 🪙 Including bad exchanges or bad wallets.

[aoluain]

yes lots of ways to lose coins.

Generally speaking humans are lazy, we see it all the time and have experienced it on
numerous occasions where people have lost access to their coins because they didnt
take full custody of them.

Its the same with addresses in the above scenario, and I think a lot of people dont realise
the possible consequences of trusting exchanges to always keep previously used addresses
accessible.

Using a wallet address should be a once off event.

Also we should be mindful of signature campaigns too where we are using the same
address potentially for over a year.

At the risk of creating more work for the campaign admins, we should update our
receiving address every so often...^{apologies for the slightly off topic sig. related post}

[Upgrade00]

But, for some reason people keep saving old addresses places and then bad things happen.

You might need to provide more clarity on this point. What exactly do you mean by saving old addresses? Do you mean keeping backups or having the address copied down somewhere?

You should never delete a wallet

The more ideal advice will be to never delete a wallet and ensure to always have the backups.

[SmartGold01]

And if you sent to your own wallet, don't save the address.
Address reuse is bad for privacy anyway but beyond that if you loose access to that wallet for whatever reason do you even want the possibility that you can sent to it by mistake at some later time?

The coins you save may be your own.

I think before someone should reused the address saved they should be able to go back the wallet to know if actually there is no update that comes across that wallet either lead to change of address just like Binance did, they do change all their 0x address and some others, and any one who had this addresses saved in their custody may likely loss funds because they don't get the information about the sudden changes. So it's applicable to wallet out there they might stop operation and close their wallet what happened when we send in our funds to that address we ends up losing our entire funds without knowing its our fault.

[Cricktor]

Shit and errors can happen, but you also have some responsibility to verify that your transfer destination address is valid and usable, especially when it is supposed to be one of your own wallets (if you have multiple ones).

Do not discard/destroy old wallet's files (wallet.dat), old wallet's mnemonic recovery words and whatever else you have from past wallets that's needed to recover them. Simply keep it, maybe with less storage safety compared to your current wallets that are in use. If you keep your old wallet's mandatory recovery data, you should be able to handle receipts to old addresses more gracefully. Good documentation helps, too.

And again, switch on your brain and check carefully the validity and usability of your transaction's outputs when you move coins to your own wallet(s)! The Localbitcoins example of the guy who sent coins from an exchange to his months long defunct Localbitcoins address is a stupid mistake and a reckless move without prior validation (the incident's thread is linked by OP of this thread). Sorry to be frank, but it's the other OP's fault. It has been long known that Localbitcoins will shut down the service. I'm surprised a user can still login to his account.

[sheenshane]

Not your keys not your coins. And not an address you have access to not your coins.

It's important advice that I repeatedly keep saying when someone needs advice about keeping their crypto coins.
Especially if someone relying on an exchange upon keeping their coins.

I tend to agree with your concern.

With more and more exchanges shutting down and the constant hacks against them using saved addresses is just going to cause loss of access to coins more and more.

Any custodial exchanges or wallets shouldn't be trusted even if they have sweet promises that your fund is SAFU.
Have your wallet that has your backup instead of trusting exchange.

[Minecache]

✂️

... and also don't move a large sum of money into an exchange address at once, you can break it down into smaller chunks. Even if the exchange is still in operation and they haven't changed their deposit address, they could confiscate your funds for any other reason at all, so sending funds in smaller chunks might save you from losing everything.

This is OP's fault because he was too subjective with his actions, if he had been more careful and always checked everything before making a transaction, nothing would have happened. So I would disagree with your idea of making multiple money orders instead of just one. With current transaction fees, do you think it is wise for us to do so many bitcoin transactions? While we just need to be careful and we can save money with just 1 transfer? This is the user's careless error, we do not need to blame the exchange.

[philipma1957]

✂️

... and also don't move a large sum of money into an exchange address at once, you can break it down into smaller chunks. Even if the exchange is still in operation and they haven't changed their deposit address, they could confiscate your funds for any other reason at all, so sending funds in smaller chunks might save you from losing everything.

This is OP's fault because he was too subjective with his actions, if he had been more careful and always checked everything before making a transaction, nothing would have happened. So I would disagree with your idea of making multiple money orders instead of just one. With current transaction fees, do you think it is wise for us to do so many bitcoin transactions? While we just need to be careful and we can save money with just 1 transfer? This is the user's careless error, we do not need to blame the exchange.

try reading closer the op did not lose coins.

I know you may want to make a signature payment as you get paid but you are simply wrong as the op did not  lose coins.

[UchihaSarada]

There are lots of ways to lose coins. 🪙 Including bad exchanges or bad wallets.

Choose a good wallet to use is important, that is a first important step but it is not the only important step to avoid losing coins.

Some other practical steps like creating a wallet (offline), backing up a wallet, storing the wallet backups (safely or not), and having ability to use backups for wallet recovery, are all other important steps.

Bad exchanges.
Bad wallets.
Bad practices.

They are all bad contributors to lose coins.

[coinremitter]

Absolutely agree, Dave. Security first! Always store your crypto in wallets where you control the private keys. Exchanges and saved addresses are risky due to potential closures or changes. Protect your assets, folks. Not your keys, not your coins. Stay safe out there!

[Plaguedeath]

It's really greedy to save or choose an old address that you previously use, I always open my wallet to see the receiver address to make sure if I can access the wallet and I didn't mistakenly send my coins.

Of course this is a mistake, but more like a stupid fault by the user, with a common sense they won't do this.