Coinbase is no doubt a great and very reputable service due to its simplicity and ease of use. Due to how easy to use Coinbase is, Coinbase has been one of the biggest bitcoin and cryptocurrency exchanges that we have right now.
But, has Coinbase been hacked?
The quick answer: No.
BUT WAIT! Does that mean that it’s going to be safe to store your coins on Coinbase? Also, a big no.
Why you shouldn’t leave funds on Coinbase
While Coinbase sure is doing a great job on the security side, it still doesn’t mean that they couldn’t get hacked in the future.
Always remember: Exchanges get hacked all the time. As of now, there are a total of 45 hacked exchanges since 2011. Yes, you got that right— forty-five exchanges have been hacked already, and unfortunately, it doesn’t stop there. More and more exchanges will get hacked as time goes due to the simple fact that lots of money could be potentially stolen by hackers. If that doesn’t convince you to stop leaving your coins on Coinbase or any other exchange, I don’t know what will.
Where do I keep my funds instead?
Mobile wallets(if you own small amounts of coins)
Mobile wallets are wallets that, by it’s name alone, are wallets that are installed on your mobile phone. Mobile wallets are great simply because you have easy access to your funds with you at all times.
While Mobile wallets are great, we only suggest leaving funds on mobile wallets if your coins don’t cost that much. If you’re holding huge amounts of bitcoin or cryptocurrencies, we heavily suggest investing some money for a hardware wallet instead.
Why not desktop wallets? Especially if you’re using a Windows device, especially an outdated one, computer devices are a lot more prone to viruses compared to your phone. Malware and viruses that are mainly focused on trying to steal your coins are quite common nowadays, and losing your coins due to a malware/virus on your computer is one of the most common ways on how people lose their coins.
Advantages
- Convenience – if you want to transfer funds, you can simply scan the QR code of the recipient address or copy-paste the address
- **Free **– great mobile wallets are easily downloadable right now for free on the Android PlayStore and the iOS AppStore, just make sure you download the reputable and legitimate ones!
Disadvantages
- Lack of security – while using a good mobile wallet is safer than using a custodial wallet, the security of mobile wallets may not be enough especially if you’re holding a significant amount of coins. While difficult and quite unlikely, mobile phones, in theory, can still be infected with malware and viruses. For people who hold a good amount of bitcoin and cryptocurrencies, we heavily suggest getting a hardware wallet.
Some great bitcoin mobile wallets
Hardware wallets(if you own significant amounts of bitcoin)
The Ledger Nano X
Hardware wallets are small devices made specifically for securely holding bitcoin and cryptocurrencies, and is small enough to fit in your pocket. With a hardware wallet, your private keys stays inside the device hence hackers getting a hold of your private keys is automatically out of the equation(unless you do something bad like saving the 24-word mnemonic phrase on your computer). We heavily suggest using a hardware wallet instead, if you’re holding a significant amount of bitcoin or cryptocurrencies. A hardware wallet is definitely your best choice for holding coins and tokens without fearing of getting hacked.
Advantages
- High security – your wallet’s private keys never leave the device. Hence, you could really do transactions even if the computer device you’re using is infested with malware and viruses, as long as you make sure that the coins are being sent to the right address.
Disadvantages
- Less convenient – You need to plug in your hardware wallet to your computer to make a transaction; though fortunately, the new Ledger Nano X has bluetooth functionality, giving you the option to send transactions using your mobile phone instead.
In summary:
Hardware Wallets vs Coinbase wallet
| Coinbase | Hardware Wallets | |
|---|---|---|
| Convenience | 10 | 4 |
| Accessibility | 10 | 2 |
| Security | 1-6 | 9 |
| Privacy | 1 | 8 |
| Unconfiscatability | 1 | 10 |
Some great hardware wallets
- Ledger Backup Pack (recommended)
- Ledger Nano X (recommended)
- Ledger Nano S
- Trezor Model T
- Trezor One
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