The Importance of Securing Your Crypto: Why You Shouldn’t Leave It on Exchanges
Cryptocurrencies are like digital money, but to really own them, you need to be careful where you keep them. When you store your crypto on an exchange, it’s like leaving your cash in someone else’s pocket. Here’s why this can be risky:
- Risk of Hacking: Exchanges are prime targets for hackers. If the exchange gets hacked, your crypto could be stolen, and you might never get it back.
- Exchange Failures: If an exchange goes out of business or faces legal issues, your funds could be frozen or lost forever.
- Limited Control: When your crypto is on an exchange, you don’t have full control. The exchange holds your private keys, meaning they technically own your crypto, not you.
To truly own your crypto, you need a non-custodial wallet. This type of wallet gives you full control over your funds because only you have access to the private key and seed phrase (also called a secret phrase). Here’s why that matters:
- True Ownership: With your private key, you’re the only one who can move or spend your crypto. No one can freeze or take your funds without your permission.
- Secure Backup: The seed phrase lets you recover your wallet if you lose access to it. It’s like a master key that can restore everything.
- Protection from Hacks: Since your private key is not stored online, it’s much safer from hackers.
In summary, leaving your crypto on exchanges is risky because you don’t fully control your money. By using a non-custodial wallet, you hold the keys to your own crypto and protect it from theft, loss, and other risks.