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Crypto owners risk losing everything by accepting assets via shared private keys or pre-configured wallets, warns Binance’s former CEO, CZ, emphasizing the danger of shared access.
CZ Cautions Crypto Users—A Simple Transfer Could Empty Everything
Changpeng Zhao (CZ), former CEO of crypto exchange Binance, issued a cautionary message to cryptocurrency holders, emphasizing the dangers of accepting digital assets through private keys or hardware wallets given by others.
Zhao addressed the issue on social media platform X, highlighting the risks associated with shared access to crypto wallets. The former Binance boss shared his concern, stating:
Recently, I have seen several instances where people receive crypto by receiving a private key or a hardware wallet. This is a bad idea.
CZ stressed that allowing another person to retain access to a private key or seed phrase creates vulnerabilities that could result in the loss of funds. He advised that individuals receiving cryptocurrency should always transfer the assets to a personal wallet or request a direct transfer to a wallet they control, rather than accepting pre-configured wallets or private keys. “The giver still has access to those crypto. You should move the crypto to an address you own. Or better, just ask the giver to send it to an address you own,” he stressed.
Zhao resigned as Binance CEO in November 2023 after pleading guilty to U.S. federal charges, including anti-money laundering violations. He was sentenced to four months in prison in April 2024 and served his term in a low-security correctional facility, followed by a halfway house in Long Beach, California. Released in September 2024, Zhao has since expressed intentions to invest in blockchain, AI, and biotech, while distancing himself from Binance’s operations. Richard Teng succeeded him as Binance’s CEO, steering the company through ongoing regulatory challenges.
Elaborating on the dangers, Zhao described:
Having two people access the same key (or seed) is a bad idea. When those crypto move (or by a hacker), it’s almost impossible to prove who moved it (or got hacked).