CZ Claims Exchanges Are Safer Than Self Custody for Bitcoin

Binance founder Changpeng Zhao recently challenged the common wisdom that self custody is the safest way to store Bitcoin. Citing data shared by analyst Willy Woo, Zhao noted that current figures show 1.57 million BTC lost via self custody compared to 1.51 million BTC lost on exchanges. While these numbers are similar, Zhao argues that exchange losses appear more frequent only because they are public news.

Zhao explained that hacks on major platforms receive immediate media attention, while individual losses involving forgotten passwords, lost private keys, or broken hardware wallets are rarely tracked. He believes the actual number of Bitcoin lost by individuals is likely much higher than the reported data suggests. Furthermore, he noted that exchanges often maintain insurance funds, like the Binance Secure Asset Fund, to compensate users if a breach occurs.

Despite his stance, Zhao did not explicitly tell users to abandon their private wallets. He acknowledged that the recent vulnerability in Coldcard hardware wallets highlights that even self custody carries significant risks. Instead of declaring a winner, he framed the choice as a matter of personal risk tolerance and technical experience. Traders continue to monitor these security debates as Bitcoin trades near $60,347.