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The recent surge in hacking attacks has reignited the debate surrounding the safe storage of cryptocurrencies like Bitcoin.
While many individuals have commented on this issue, Binance founder Changpeng Zhao (CZ) also made noteworthy statements regarding the storage of cryptocurrencies.
In a statement from his X account, CZ said that in some cases, holding cryptocurrencies on centralized exchanges may be statistically safer than storing them in individual wallets (self-custody).
CZ noted that exchange-based attacks are often publicized and therefore easily traceable, while losses in BTC held in cold wallets often go unreported.
CZ also stated that security breaches experienced by exchanges that ceased operations in the past negatively impacted statistics for centralized exchanges, but that some large exchanges, including Binance, fully compensated users for losses incurred during such security incidents.
However, CZ also emphasized that he wasn’t arguing that keeping assets on the stock market is always a better option.
CZ stated that a balanced approach is correct, noting that different custody methods present different risk profiles and that there is no single right approach for every investor.
*This is not investment advice.