Your Crypto Security: Centralized vs. Decentralized? Why Bitnovo Doesn't Hold Your Wallets

Stepping into the world of cryptocurrencies often begins at a centralized exchange (CEX). These platforms are very convenient: you only need a username and password, just like an online bank, and they offer an integrated "wallet" for your crypto. Sounds like a simple solution, right? However, this convenience hides a fundamental risk: the centralization of your funds.

The Risk of Centralized Exchanges: "Not Your Keys, Not Your Crypto"

When you store your cryptocurrencies on a centralized exchange, you are not directly controlling the private keys to your funds. In reality, the platform itself holds them. This means you are placing full trust in the exchange's security, which exposes you to significant risks:

1. Hacker Attacks: Centralized exchanges are large digital "safes" that manage millions of users' cryptocurrencies. This makes them an extremely attractive and lucrative target for cybercriminals worldwide. A successful hack can result in the massive loss of user funds.

   • Example 1: Mt. Gox (2014): One of the most famous hacks in history, Mt. Gox, which at one point handled most Bitcoin transactions, lost hundreds of thousands of BTC from its users, leading to its collapse.
   • Example 2: FTX (2022): More recently, the collapse of FTX, one of the world's largest exchanges, exposed that user funds were being mismanaged and lost due to internal misconduct and fraud, not a direct external hack, but with the same devastating result for customers.

2. Platform Shutdowns or Internal Issues: If the exchange goes bankrupt, becomes entangled in legal problems, or decides to close, your funds could become inaccessible or very difficult to recover.

The famous saying in the crypto world is: "Not your keys, not your crypto." This is the inherent risk of entrusting your assets to a third party.

The Bitnovo Model: Self-Custody and Decentralization of Risk

At Bitnovo, we operate with a philosophy of user security and control that specifically minimizes this centralized risk. Unlike many exchanges, Bitnovo does NOT hold users' cryptocurrency wallets on its platform once an operation is completed or for long-term custody.

So how does it work?

• Your Self-Custody Wallet in the Bitnovo App: If you use the wallet we offer in our application, this is a self-custody wallet. This means that only YOU have the private keys (derived from your seed phrase). Bitnovo does not have access to that wallet; your crypto is under your direct control on the blockchain.
• Direct Operations (Buy/Sell): When you buy cryptocurrencies from Bitnovo, we send them directly to the wallet address you provide (it can be your Bitnovo app wallet or another external one you control). When you sell, you send the cryptocurrencies to our temporary address, and we transfer the Euros to you. At no point does Bitnovo permanently hold your cryptocurrencies as a custodian.

The Peace of Mind of Self-Custody and Transparency

By not custodying your cryptocurrencies, Bitnovo eliminates a centralized point of failure. The security of your funds rests in your hands, which is where the true power of cryptocurrencies lies. This gives you:

• Total Control: You are solely responsible for your funds.
• Greater Resistance to Hacks: Your funds are not in a massive "loot" that a hacker could steal from an exchange.
• Freedom and Autonomy: You do not depend on third-party policies regarding fund retention or freezing.

At Bitnovo, we offer you a secure and simple gateway to the crypto world, always prioritizing your control and autonomy over your assets. With us, the power of your cryptocurrencies is where it should be: in your hands!