CZ says exchanges are statistically safer than self-custody

Binance co-founder Changpeng Zhao, known as CZ, wrote on X that it is statistically safer to store coins on exchanges than in self-custody — responding to data shared by analyst Willy Woo.

It is statistically safer to store coins on exchanges than to self custody

Woo had posted figures from a December 2025 report: roughly 1.57 million BTC lost through self-custody versus about 1.51 million BTC lost on exchanges. CZ acknowledged that, if the data is accurate, it gives reason to reconsider the common assumption that self-custody is inherently safer.

At the same time, CZ pointed out weaknesses in the comparison himself: hack data is easier to collect on the exchange side, since it usually becomes major news, while cases of lost coins or hacks in self-custody often go unreported entirely. He also noted that exchange-side statistics are dragged down by long-defunct platforms, and that funds like Binance's SAFU — created in 2018 and now holding around $1 billion in reserves — have repeatedly made users whole after losses, including roughly 7,000 BTC after a 2019 hack.

• Per Willy Woo: ~1.57 million BTC lost in self-custody vs. ~1.51 million BTC on exchanges
• Binance's SAFU fund holds roughly $1 billion in reserves, established in 2018
• CZ: "Not saying one is better than another... a balanced approach is probably best"

The discussion unfolds against the backdrop of the ongoing Coldcard hardware wallet attack, which we've covered from its early stages to its latest wave: first when losses climbed to $89 million and CZ already warned that "nothing is 100%", and then when a fourth wave pushed the damage toward $114 million. Woo's data, notably, dates to December 2025 — meaning it doesn't account for the most recent Coldcard incidents, which could have shifted the balance of losses between exchanges and self-custody meaningfully in either direction since then.

CZ himself openly acknowledges the limits of his own statistics and isn't urging everyone to move to exchanges — his actual takeaway is closer to the idea that both approaches carry different risks, and the sensible strategy is to rely fully on neither, spreading holdings across more than one storage method instead.

Nothing here should be taken as financial advice — just information to consider.