Reasonable strategies for storing crypto on exchanges. (Reduce catastrophic downside, increase open upside) Layered custody: Long-term holdings → self-custody with a hardware wallet (private keys offline); only keep the "short-term trading volume" on the exchange. Limit rule: Set a hard upper limit for "exchange balance / total holdings" that you can afford to lose entirely (e.g., ≤10–20%, based on personal risk tolerance). Diversify counterparties: If you must store on exchanges, don’t concentrate on just one; diversifying can turn "one hit wipes out everything" into "one hit damages only a portion." Choose compliant, transparent exchanges with proof of real reserves, and avoid high-interest investment schemes or shady platforms (high returns are the strongest fragility signal). Strengthen account security: Use a unique strong password + hardware/App-based 2FA (not SMS) + withdrawal address whitelist. Withdrawal drill: Regularly withdraw small amounts to ensure the channel is smooth—verify "can I withdraw" before a bank run, not discover it’s frozen at the last minute.