Are Crypto Assets Safe on Exchanges?
[Originally posted on June 27, 2023]
(Any views expressed in the below are the personal views of the author and should not form the basis for making investment decisions, nor be construed as a recommendation or advice to engage in investment transactions.)
We’ve received multiple questions around getting crypto off exchanges amid the SEC crackdown on Binance and Coinbase last week and wanted to offer our thoughts. TL;DR Get crypto off exchanges — 1) Self Custody with Ledger or Trezor or 2) Let 8DC be your partner to safely store and grow your crypto holdings.
The News
Last week, the SEC charged Binance and Coinbase with offering unregistered securities. Robinhood has delisted some crypto assets, and Crypto.com is stopping its institutional exchange services in the US. We continue to think Coinbase is safe, but we understand the concern of keeping your crypto safe, and why holding crypto on exchanges might not feel best right now.
SEC to Freeze Crypto Assets on Binance
SEC Charges Coinbase for Operating as an Unregistered Securities Exchange
Robinhood to DeList Crypto Assets Mentioned in SEC Filings on June 27
Crypto.com To Shut Down its Institutional Exchange Service for US Customer June 21st
Monday to Thursday last week reportedly saw $3.9 Billion in outflow from Binance and Coinbase combined.
Custody
So — what is to be done? First of all, If you’re holding crypto, don’t panic. This is the time to accumulate crypto assets leading into the next cycle, not sell. Bull market is ahead of us. But where do you hold your crypto?
Exchanges have been the most comfortable place to hold crypto. It’s easy. Decentralized wallets take a bit more effort and education. BUT it’s worth it. We highly recommend decentralized wallets. We use an institutional decentralized wallet at 8DC for custody. We interact with decentralized exchanges for trading.
8DC as a Solution
If you’re uncomfortable with decentralized wallets, 8DC can be your crypto partner. We invest a great deal in security and properly custodying the crypto assets we hold. Investing in our fund removes the personal energy spent on headlines, regulation, and volatile prices. We keep your assets safe on decentralized wallets, and we’ll provide strong multiples (outperforming BTC/ETH) over the next few years.
Additional Notes if you’re on the fence on whether you should hold your crypto or not:
We’re confident that in the long run, this will be a blip in crypto’s journey just like all of the other attacks and criticism that have come before it.
Fred Wilson, who has been investing in crypto and standing in front of regulators since the very beginning, understands the opportunity that we have in front of us:
Plus, despite the headlines, it’s not all bad news. The number of unique crypto users continues to grow:
And in many respects, this attack from the SEC, while perhaps painful in the short run, is a step toward resolution and the guidance we need to continue to move the industry forward. As Ryan Selkis says who is spending more and more time on crypto legislation in DC:
