Experts Consider the Security and Risks of Noncustodial Exchanges

Despite centralized cryptocurrency exchanges suffering nearly $300 million worth of hacks during 2019, many digital currency traders continue to hold significant sums of capital on centralized exchange platforms.

While many noncustodial crypto services have launched in recent years, few platforms have been able to garner significant liquidity. Cointelegraph reached out to several industry experts to discuss the promise of noncustodial exchanges.

Are noncustodial platforms safer?

Erik Voorhees, CEO of the noncustodial cryptocurrency exchange ShapeShift, told Cointelegraph that, “Noncustodial exchanges provide a fundamentally safer way for individuals to trade digital assets.” He went on to add:

“Traditionally, exchanges are custodial (and almost all of them still are today), and thus they hold user funds. Some exchanges literally hold billions of dollars worth of crypto on behalf of their customers. This crypto can get lost, hacked, stolen, mis-accounted, etc. […] Often, this…