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How Can Individual Users Better Protect Their Digital Assets When an Exchange is Hit?

this image is about  the price of the Bitfinex BTC-USDT perpetual contract suddenly soared to $56,500 in May 3rd 2023.
Bitfinex BTC-USDT perpetual contract suddenly soared to $56,500

In November 2022, a series of blockchain industry thunderstorms triggered by Alamenda Research's debt crisis and the FTX run frenzy caused investors to be highly concerned about the risks of investing in digital assets.

In March 2023, Coinbase Global Inc. (COIN) announced that the US Securities and Exchange Commission (SEC) had informed the company of pending enforcement action, increasing the regulatory scrutiny on the largest US cryptocurrency exchange and intensifying the crackdown on digital currency companies.

Recently in May 3rd 2023, the price of the Bitfinex BTC-USDT perpetual contract suddenly soared to $56,500 due to a typo in one of Bitfinex’s wash trading accounts that is ostensibly in the name of a pretend third party company.

As an independent investor, what steps can you take to better protect your digital assets when an exchange is hit by a run or anything else?

  • Plan ahead: Before using an exchange, users should plan and prepare adequately. For example, understand the exchange's security, track record and reputation, and determine the risk and risk tolerance of using the exchange.

  • Diversification: Users should diversify their digital assets into different wallets, thereby reducing concentration risk. This way, even if the exchange is attacked or shut down, the user's assets will not be completely lost.

  • Own control of private keys: Users should keep the private keys of their digital assets in their own devices or paper wallets and back them up in a safe place, thus avoiding the risk of having them hosted on an exchange.

  • Timely withdrawals: If users need to trade digital assets, they should complete the transaction and withdraw the assets to their wallets as soon as possible, rather than leaving the assets on the exchange for a long time.

  • Follow media reports: In the event of an exchange run, users should follow media reports and social media messages in order to take timely action.

  • Seek professional help: If you experience a loss of digital assets or other problems, you should seek professional help, such as contacting exchange customer service or legal experts.

The crypto investment market is rapidly changing and investors should always be vigilant and take timely and appropriate measures to protect their digital assets. When using an exchange, you should choose a compliant and reliable exchange and understand the risks associated with it so that you can take appropriate measures to mitigate those risks.

iSunOne is a digital currency payment platform that offers Quickpay, a fast and secure payment service that enables users to transfer digital dollars directly to each other without waiting for confirmation times or paying gas fees. The platform also offers the Global USD Card, a dollar-based Visa prepaid card that allows users to charge digital dollars quickly and easily without any fees. With iSunOne, users can enjoy a flexible, convenient, and secure payment experience.


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