Here’s why you should think twice before storing your digital assets on centralized exchanges.

1. You Don’t Truly Own Your Crypto

When you store your coins on a centralized exchange, you’re not actually in control, the exchange is. They hold your private keys, meaning your funds are effectively theirs until you withdraw them. The saying “Not your keys, not your coins” exists for a reason. If an exchange freezes withdrawals, faces regulatory action, or goes offline, you might lose access to your assets instantly.

2. Exchange Hacks Are More Common Than You Think

Centralized exchanges are prime targets for hackers because they hold billions in user funds. Over the years, platforms like Mt. Gox, FTX, and Bitfinex have suffered massive breaches, costing users hundreds of millions of dollars. Even the most “secure” exchanges aren’t immune and once your crypto is stolen, recovery is nearly impossible.

3. Sudden Freezes and Government Regulations

CEXs are subject to strict government oversight. They can freeze accounts, limit withdrawals, or comply with orders to seize assets. In times of political or economic uncertainty, exchanges might restrict trading or even halt operations, leaving users locked out of their funds. Storing your crypto yourself through a non-custodial wallet ensures you stay in control, no matter what happens.

4. Platform Failures and Mismanagement

The collapse of major exchanges has shown how vulnerable centralized systems can be. FTX’s downfall, for instance, revealed how user funds can be misused or mismanaged behind the scenes. Even trusted platforms can fail overnight, taking user deposits with them. Relying solely on these entities goes against the decentralized spirit of crypto.

5. Safer Alternatives Exist

If you want to keep your crypto truly secure, use hardware wallets or non-custodial software wallets like MetaMask or Trust Wallet. These allow you to control your private keys while still giving you access to decentralized exchanges (DEXs) for trading. Cold wallets (offline storage) are even safer for long-term holdings.

To protect your crypto from hacks, shutdowns, and misuse, always keep your assets in wallets you control. After all, true ownership in crypto means having full custody of your keys, and your future.