Is it safer to keep coins on an exchange or in a wallet?

The question of whether it's safer to keep coins on an exchange or in a wallet has always been a topic of great concern.

From the exchange's perspective, keeping coins on an exchange is like depositing money in a bank. In the exchange's wallet, transactions are convenient and quick, allowing for buying and selling at any time. However, exchanges come with various risks. Taking FTX as an example, once an exchange goes bankrupt, coins may face loss. Exchanges may not be able to guarantee the safety of user assets due to issues such as poor internal management, technical vulnerabilities, or broken capital chains.

Now looking at wallets, whether cold or hot, assets are stored on the blockchain network. Through mnemonic phrases, users can control their virtual currency. In this way, users have more direct control over their coins, avoiding the risks that exchanges may bring. But wallets are not foolproof either. Poor password management and cybersecurity threats can also lead to wallet theft.

So is it safer to keep coins on an exchange or in a wallet? This requires a comprehensive consideration of various factors. The advantage of exchanges lies in their convenience and strong market liquidity; while wallets focus more on user autonomy and security.

For ordinary users, choosing between an exchange and a wallet requires caution. If choosing an exchange, one should select a reputable and reliable exchange, such as Binance, and keep an eye on its updates. If choosing a wallet, one should enhance password management and ensure the security of mnemonic phrases. It is still advisable to choose exchanges, as major exchanges are now regulated, and even in the event of a crisis, compensation will be provided; avoid choosing unregulated exchanges.