If you're new to the crypto space, you may not have heard of or be fully aware of the countless times crypto exchanges have either exit scammed or have been hacked over the past few years. For the more fortunate exchanges, they take the hit and trudge along while others aren't so fortunate and shut down completely along with their users' money and coins. I've personally witnessed and experienced this first hand (don't worry, it wasn't a lot) with one of Canada's previous "top" exchange (QuadrigaCX).
One day I go to their website, and to my not so surprise, I see a notice explaining the circumstances surrounding them. The notice addressed how the CEO has "died" and that he was the only person with the keys to the coins which essentially meant that they were insolvent. Not only did I lose my funds, but so did hundreds (probably in the thousands though) of other people. In fact, there's even a vlog of how Tong Zou lost $500,000+ to them. You can check it out here.
This can be horrifying and sickening to read for those who are just starting out as this isn't a common occurrence with the financial institutions that we tend to trust and leave our money with. Should something happen to our bank account or credit card, we're only a phone call away from (potentially) getting the problem solved. However with crypto, it's the Wild West. There isn't really a phone number or someone who we can call directly to reverse a transaction or to get our problems sorted out. This is why I stress learning about security and practicing good habits to protect your assets first before anything. What good is it to have millions in crypto but only to have it stolen or even lost due to a lack of a solid foundation of knowledge in keeping them safe?
I believe that this is why we are seeing more decentralized platforms being created as people don't want to experience going through some sort of loss of funds due to an exchange hack or exit scam. Decentralized platforms are giving power back to the owners of the coins as it allows them to remain in full control over their funds and to not need to trust a centralized authority to promise to give them the coins they're owed.
Having said that, let's take a look at KyberSwap for example. They're a trusted website that have been in the crypto space for years now where you can swap Ethereum (only) for tokens, or vice versa, in a decentralized and trustless manner. The swaps happen fully on-chain, which means that KyberSwap never holds your coins or funds. In addition, because everything is on-chain you can view your transaction on Etherscan.io which is an Ethereum blockchain explorer. You can swap well over 70 tokens, and even connect different wallets to trade. They've now even got a beta feature where you can trade directly against other coins with limit orders. But of all the features that KyberSwap has though, the most important aspect is that your private keys NEVER leave your wallet; you always have them. You just go to their website, connect your wallet of your choice (Metamask, Ledger, Trezor, Keystore file, Coinbase wallet and a few others), choose the coins you'd like to trade, make the swap, and that's it. You should have your coins within a matter of minutes.
If you'd like to learn more about using KyberSwap, here's a video I made.
Just as the saying goes in crypto, "Not your keys? Not your coins." Despite knowing and accepting the risk I was taking by leaving my funds on their exchange, losing that a bit of money still stung. Even though I got over it shortly after, I still wouldn't want anyone else to experience that. I hope that my misfortune of losing my funds has reached out to you about the importance of keeping your keys to your coins safe at all times. To those who decide to leave coins on exchanges though, just make sure that it's not more than you're willing to lose.
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