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Review of a fact; Exchange is not a wallet!


How would you feel if you woke up one day and saw that you did not have access to your assets on a centralized exchange office? If you do not want to experience such a feeling, read this article to the end.

Maintaining digital currencies on centralized exchanges

By sending your digital currencies to a centralized exchange, you are in fact transferring ownership of your digital currencies to an exchange.

In these exchanges, full control of the digital assets of individuals is in the hands of the exchange. In fact, the assets are kept in the wallets of the exchange offices and only the balance number is included in the account of the exchange users. In this case, you have access to your digital currencies, but you have to trust an exchange to keep a company safe and secure.

In this regard, we recommend that you watch the following video from Antonopoulos, a prominent Bitcoin expert:

Even when a centralized exchange wants to operate transparently and soundly, some external risks still threaten assets. According to statistics According to the CoinGecko website, hackers stole more than $ 286 million worth of digital currency from exchanges in 2020 alone, bringing the total to more than $ 3 billion. As an example, which also affected Iranian users, the Cryptopia exchange was hacked and then disbanded in 2019. Due to the long legal settlement process, the users of this exchange have not yet reached their assets after nearly two years.

Storing digital currencies on exchanges only makes sense for people who want to trade on a regular basis.

What is the solution?

Andreas Antonopoulos has an interesting sentence that says: “If your key [در دست خودتان] No, not your bitcoins either [در دست خودتان] is not.”

Review of a fact;  Exchange is not a wallet!

The best way to keep digital currencies in the long run is to store them in a reputable wallet. Simply put, you should use a wallet that is known to give you a private key or 12/24 word recovery.

Reputable software wallets that are installed on a mobile phone (such as Trust Walt) or a personal computer (such as Exodus) are completely free and can ensure the security of your assets if you follow safety tips and keep your recovery words. If you want more security, you can use hardware wallets or other Offline (cold) storage methods use.

If you do not know how to find a reputable wallet for your digital currency, the comprehensive article “Digital Currency Wallet Guide” will help you.

As long as your digital currencies are in your personal wallet and the necessary safety tips are observed, they will not be in any danger. What are the safety tips we are talking about? Here are the most important ones:

Take a backup

After installing the wallet, the first thing to do is make a backup of the wallet. If you do not have a backup of your wallet and for any reason the software is deleted, the device crashes and things like that happen, you have to say goodbye to the investments inside that wallet forever.

Recover words

The type of backup in each wallet can be different. Most wallets provide a set of 12 or 24 English words to the user as a backup, which is no different from a private key, and in case of any problem, the user can recover his capital with those words. Other wallets also provide a private key directly to the user to store it in a safe place. A small number of wallets also provide the user with a special file that is encrypted with the user-selected password, and to access the assets, a backup file and password must be created.

Download from reputable sources

Relevant wallets and software downloaded from unreliable sources can themselves be malware and theft of your assets.

The official website of any wallet is the best source for downloading software. Even when you want to get the software you want from Google Play or AppStore, you have to be very careful and very careful, because sometimes counterfeit software with the name and logo of the main software appear in Google Play and App Store. As a prime example, Ledger wallet mobile software is called Ledger Live. Some time ago, several counterfeit software with the same name and logo as Ledger Live appeared on Google Play, and on the other hand, due to sanctions, Iranian users could not see the original software on Google Play. Installing such software is tantamount to wasting all capital.

Use strong passwords

Review of a fact;  Exchange is not a wallet!

Software called “crackers” can check different passwords for a username very quickly, and if your password is simple, the software will find it in less than a few days. For this reason, it is better to use uppercase and lowercase English letters as well as punctuation marks in your password. Of course, most wallet systems these days are equipped with anti-spam layers.

Update your software

Always provide the most secure environment for your wallet by updating your software. Not only wallet; Keep your computer systems and cell phones up to date. Always keep your anti-virus and anti-malware software up to date.

Use a separate browser

If you are using a web wallet or you want to connect to your wallet through a browser, malicious plugins in browsers should not be forgotten. It is best to allocate a clean, plug-in-free browser to access your wallet to reduce the risk of private key theft.

Enable 2-step login

Enabling 2-factor authentication (2FA), or 2-step login to your wallet, prevents anyone from accessing your wallet even if your password is shared. In this method, the user must pass another filter (such as confirmation of SMS, email and PIN code) in addition to the password.

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