What is a Wallet in Spot Trading (Is it safer to keep coins in exchanges or wallets)?
What is a wallet in spot trading? According to data from CoinMarketCap, on Febr
What is a wallet in spot trading? According to data from CoinMarketCap, on February 19, 2019, the price of BTC reached $10,800. With the rise of ETH and BCH (as of the time of writing), Bitcoin rose from around $10,000 to over $11,500, reaching a high of $12,300. On March 24, 2020, BCH also experienced a breakthrough growth.
Spot exchanges are one of the top exchanges in the cryptocurrency market, mainly providing asset custody, storage, and exchange services. Asset custody in spot trading includes digital assets within the exchange and transactions through wallets within the exchange. Since the blockchain industry is still in its early stages of development, there are many hidden risks, including: 1. User information is easily leaked, 2. System security needs improvement, 3. Loss of private keys and reconciliation, 4. Overly centralized network resources, 5. Platform cannot guarantee asset security, 6. Security control of funds, 7. Technical means difficult to protect personal privacy, and 8. Users can access various third-party tools at any time to ensure their identity recognition and confirmation.
Is it safer to keep coins in exchanges or wallets?
The answer is no. Because digital currencies are a type of asset category on the blockchain, they are themselves virtual properties. Cryptocurrencies such as Bitcoin are more like strings of random characters forming digital codes.
The most crucial point is that the Bitcoin a user holds is locked in smart contracts and has no value transfer to other addresses. Therefore, if a user loses their private key or their funds are damaged, hackers can seize the opportunity to steal their encrypted assets.
Of course, such attacks can also be avoided. However, for a novice, one thing to note is whether your coins are safe in exchanges or in wallets.
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