Crypto exchanges are among the least secure places to store cryptocurrencies. The only crypto users who keep funds on an exchange are typically traders who trade the market on a daily basis. Users will no longer have to send funds to and from exchanges every time they want to place a trade.

Users should always store funds in a secure crypto wallet, not on an exchange unless they are actively trading.

Security breaches and hacks on exchanges have resulted in billions of dollars in stolen funds in the past. As a result, investors should only trade on exchanges and then withdraw funds to a personal wallet once traders have finished trading for the day, as seasoned day traders do to securely store their funds overnight.

The decision to store cryptocurrency on an exchange or a wallet depends on security, convenience, and trading frequency. Exchanges offer quick access for active trading but are vulnerable to hacks, scams, or platform failures, making them risky for long-term holdings. Wallets, especially hardware or non-custodial software wallets, provide greater security by giving users full control of private keys, reducing theft risks. However, wallets require careful management; losing keys means permanent loss of funds. For short-term traders, keeping crypto on a reputable exchange with strong security (like cold storage and 2FA) may be practical. For long-term investors, transferring assets to a secure wallet is safer. A balanced approach involves keeping only necessary funds on exchanges for trading while storing the majority in offline wallets for maximum protection.