CZ Says Crypto May Be Statistically Safer on Exchanges Than in Private Wallets
Summary
- Changpeng Zhao said crypto assets may be statistically safer on exchanges than in private wallets.
- He said cases involving some defunct exchanges have worsened broader statistics, but some exchanges, including Binance, have compensated users when hacks occurred.
- He said each custody method carries different risks and product structures, and that diversified storage using both is the most balanced approach.
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Changpeng Zhao, co-founder of Binance, said crypto assets may be statistically safer on exchanges than in private wallets.
Writing on X on Aug. 4, Zhao said that, assuming the data is accurate, exchange hacks are usually reported as major news events, making losses easier to quantify. Private-wallet hacks and asset losses, by contrast, often go unreported.
He also said losses tied to some defunct exchanges are skewing industrywide exchange statistics. Some exchanges, including Binance, have compensated users when hacks occurred, he added.
Zhao stressed that he was not arguing exchange custody is always better than self-custody.
The two approaches carry different risks and product structures, meaning the best choice can vary by user, he wrote. Combining both methods is the most balanced approach.
Minseung Kang
minriver@bloomingbit.ioBlockchain journalist | Writer of Trade Now & Altcoin Now, must-read content for investors.