Popular crypto exchange, CoinDCX has announced that it will start allowing its users to store their crypto assets in self-custody. The CEO of the exchange, Sumit Gupta gave the hint in a Friday Twitter post. According to Gupta, the developing team of CoinDCX are currently working towards making self-custody of cryptocurrencies possible in no distant time.
Notably, the prevailing FTX saga has consequently heightened controversies about the safety of centralized exchanges. Recall that the issue started after a leaked balanced sheet reportedly indicated that Alameda Research, a company founded by Sam Bankman-Fried, tied up billions of dollars of its assets in FTT. Notably, both FTX and Alameda are owned by Sam-Bankman Fried.
This development thus informed Binance decision to liquidate about $500 million of its FTT holdings, thereby triggering massive withdrawals of assets from the exchange. Also, this plunged the FTT token to around a 75% low.
CoinDCX has no exposure to FTX
Notably, the crisis overwhelmingly impacted the crypto sphere, leaving many crypto firms with exposure to FTX in a state of dilemma. Meanwhile, CoinDCX assured its users that it had no exposure to the troubled exchange. Further, CoinDCX said it keeps stringent security checks to ensure user funds are safe in hot and cold wallets.
Notably, its wallets possess multi-party-computation (MPC). This thus prevent any transfers from manifesting without going through a set of procedures. Worth noting, a session of the procedures requires authentication from the users themselves.
Further, CoinDCX said it took a decision not to have a native token to safeguard users from asset concentration risks. According to the exchange, many exchanges today possess native tokens which takes a lion share of their net worth.
These exchanges, as revealed, used the native tokens as a store of value and medium of exchange across products and liquidity. CoinDCX added that in most cases, those exchanges offer incentives like airdrops to increase the values of their tokens. This thus exposes users to asset concentration risk and liquidity risk, it remarked.
Additionally, CoinDCX boasted that its processes are regularly audited. More so, the exchange says it usually conduct daily audits of users funds and map them across the wallets.
According to CoinDCX, its active monitoring thresholds endures that it receives alert on events capable of posing risks to users funds. Remarkably, the exchange reiterates its commitment to users safety. It aims to abide by the best practices of risk management, transparency and consumer protection.
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