Bitfinex, Bittrex and Coinbase are just three of the hundreds of reasons why you should never hold your coins on an exchange

Andreas Antonopoulos has a very important rule: "your keys, your coins, not your keys, not your coins". Especially with regulators now putting pressure on exchanges worldwide due to bitcoin's enormous success you can expect to lose your money if you leave it on an exchange.

People have been conditioned for centuries to leave money with authorities. This is a very bad habit that must be broken because it violates Satoshi Nakamoto's decentralization principles. Decentralization is the key to your security. At the end, I will show you how not to become a victim.

(Google Images - Wikimedia Commons)

Bitfinex will close its doors to US customers on Nov 9, 2017. This is due to the regulatory landscape that makes it difficult for Bitfinex to know whether or not it will be in compliance. There's a lot of uncertainty for the company with a lot of legal down sides in dealing with US customers.

Bittrex has also been dropping some user accounts and leaving a lot of people in the dark as to what was happening.

Another problem that happened earlier this year was when a US citizen traveled to Cuba. When he returned, he found that because he accessed his Coinbase from a country still regulated by sanctions, he found his account disabled.

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Those of you using VPN's for security, should also take note because if you happen to select some country such as North Korea, even though you reside in the USA and are transacting from the USA, your account can still be flagged.

All of these instances should remind you of MtGox. As Andreas Antonopoulos says, "there's only two types of exchanges, those that have been goxxed, and those that will be goxxed".

Fortunately the answer to this is fairly simple but it requires you put personal responsibility first. You are the king of your own castle, or in this case, you should be the CEO of your own central bank. When things go wrong, it's up to you to fix them and not go crying to authority like a whipped pup. When you do, you become the problem for all the rest of us who take responsibility for ourselves. The result is that we have to protect ourselves legally from your incompetence.

So if you're ready to become your own banker, here's how to do it...

(Google Images - Wikimedia Commons)

Get a hardware wallet such as a Trezor or Ledger S Nano. There are a few others out there but first make sure that your wallet can hold the private keys for the currencies that you want to hold. You may have to set up a paper wallet for some of the lesser known coins.

Then memorize your 12 - 24 word seed or write it down and keep it in a safe place. That seed is your key to wallet security. Technically "wallet" is a bad word for this device because some people mistakenly think that the money is on the wallet. It is not. Really these devices are key chains and the money is recorded out there on thousands of nodes (computers) that operate as miners for the network and encumbered with proof of ownership.

If you lose your wallet, it is no problem to get your funds back. But you should always keep your passwords, PIN and above all, your 12 - 24 word seed safe! You should be able to remember your PIN and passwords and if you can do it, memorize your 24 word seed. It's your only defense against civil asset forfeiture which is sure to come in the future when authorities get desperate over the mishandling of the economy.

Remember, security is up to you!

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