I've been planning to write about keeping your crypto safe as it's an important topic. New users may not be aware of the danger, nor the possibilities we have to protect our stake.
Staking your coins on our blockchain is one way to protect your assets. Tribes may have a different policy when it comes to unstaking, but so far on Hive, there's a 13 week period when it comes to unstaking. In case of a hack, you have time to take back control over your account and stop unstaking. This is why it is a good idea to stake your liquid Hive if you don't have other plans with it.
Yesterday I saw a post by penguinpablo, about how much HIVE is stored on exchanges, perfect data for my post.
Hive can be transacted in four different exchanges according to CoinMarketCap, of which Binance has the largest liquidity.
The chart is interesting. The amount of HIVE stored on exchanges is on the rise and the trend is going to continue I suspect. I'm also guilty of hodling 35 Hive on Binance.
Many are hodling HIVE on exchanges, waiting for the price to go up to be able to sell. It's understandable and logical but how safe is it?
It's common knowledge that when there are huge price drops or rises, exchanges can freeze. It's happening constantly, so you may miss a good opportunity even though you have been ready for a long time. This is something you have to think about.
Those of you who are new and started on Hive blockchain and not on Steem, may not know what happened before the fork. I'm not sure which exchange it was exactly, can only guess, so I'd rather not name it, but what happened was that Justine Sun colluded with the exchanges to support his witnesses will he implements a hardfork to change the power down period from 13 weeks to 4 weeks. This promise made that certain exchange to use custodial funds to power up and vote Sun's witnesses.
This action resulted in a blockage, users were not able to access their funds. There was a message according to which there was a maintenance going on. Those funds were client's funds, so the exchange had no business powering it up in the first place, let alone lying about it. As far as i know this was the only case, but who knows, if it happened once, it can happen again.
The other reason you should not trust exchanges too much is the classical saying, not your key, not your crypto.
Cold storage is the safest, even though there's a fee to pay when transferring your funds out of exchanges. If you're a long term hodler, worth investing in a Trezor or Ledger or whatever cold wallet you trust.
The disadvantage of cold wallets is that not every asset can be stored on them. Usually these work for Bitcoin and major alts, but HIVE is nowhere near to be accepted by cold wallets.
Regardless how much crypto you're holding, you should evaluate the level of risk you're exposed to right now. Take the necessary steps to secure your investment till it's not too late. Keep your keys and/or seeds safe! Remember, not your key, not your crypto.
