Not your Keys = Not your Crypto.
The imaginable horrifying aftermath of the beloved and sweet HODOR holding the door can actually be compared to the emptiness felt by those who have lost cryptocurrencies worth millions from fraudulent exit schemes or hacks at centralized exchanges.
The most recent hacking at Binance has ignited a not-so-long but profound and open debate about safeguarding your cryptoassets; wait, did I just say crypto, as in cryptography? Wasn’t the whole point of the Bitcoin white paper o create a peer-to-peer electronic cash system that would use cryptography instead of trusting a middle man, like banks?
It seems quite evident by now that not only centralized exchanges are quite vulnerable (as opposed to decentralized ones), but also they have been behaving as the very same old banks we have been trying to avoid in the first place. For instance:
- They have the seeds or cryptographic keys of your deposits.
- They provide a terrible service for membership registration (I have actually supplied Binance at least 4 times a high-quality passport picture + selfie + a recent utility bill and my KYC request was never approved, so I gave up)
- There are hundreds if not thousands of impostors claiming to be representative of top 20 centralized exchanges, emailing from the official domain address, offering an array of hard-to-detect-traps. (twice I have emailed a centralized exchange to verify the identity one of their “agents” and they started fighting and pointing fingers at each other via email)
- They will love to list your crypto-asset for a minimum fee of 2 BTC up to 13 BTC; plus they will be delighted to do an IEO for another 2 BTC plus a success rate fee, plus you will not be able to withdraw your assets for several months.
Decentralized exchanges (DEX) are gradually starting to playing a big role in the ecosystem, specially since they provide a marketplace where listing fees are reasonable and you always, always hold your keys. Moreover, Initial DEX offerings (IDO) are on the horizon and will bring sobriety to the hot-headed banker-minded fake-volume top-20 exchanges.
Do not let a HODOR / TALE FROM THE CRYPT happen to you.