"Not your Key 🗝 Not your Crypto"

"Not your Key 🗝 Not your Crypto" This is one of the popular lines in crypto that many of you must have heard I believe. Please do not consider it just like a saying but its a truth that we need to believe in. We have seen some examples where Crypto exchanges have gone through a tough time and are bankrupt which has resulted in a big loss for the holders. I do understand that crypto exchange is a very important entity in the crypto market but you never know how the exchange operates internally.

Maybe things look good from the outside but there can be some manipulation inside where the customer funds are used by the exchange. This is not a fair practise however we have no control over it if the transparency is not maintained by the exchange and the truth is that there are so many exchanges that are not transparent but they have got quite a good number of users on their platform. FTX is one of the examples that was doing great at that time however things got worse overnight and we know what has happened with the exchange.

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After all these incidents it is highly recommended to keep the funds in either hardware wallets or non-custodial wallets. In both options, we get access to our key and this key remains with us. When we keep the funds in an exchange wallet then the key is with the exchange and they have access to the funds but when we keep the key with us through hardware or non-custodial wallet then the key is only with us.

It's good and bad depending upon the scenario. For example, if you have funds in your exchange wallet and you lose access to your account by missing the password then you can regain it by following the protocol so technically you are not losing anything even if you forget the password. Now in another case when you are keeping your funds in a hardware wallet or non-custodial wallet but you lose access to the wallet by missing a key then your funds are gone. There is no way that you can recover your funds because the key ones lost cannot be recovered and that is one of the problematic areas in such types of wallets.

It is good that we recommend using the non-custodial wallet or the hardware wallet but we have to be responsible to ensure that we do not lose access to our funds. We must keep the key safe secure and accessible for us whenever it is needed.

Thanks