Changpeng Zhao (CZ), former CEO of Binance, warns cryptocurrency investors about the risk of losing assets if they receive funds via shared private keys or pre-set wallets from others.
Risk of Losing Everything Due to Shared Wallets
CZ stated that sharing wallet access through private keys or recovery phrases is a serious risk. He emphasized on social media 𝕏:
“Many people receive cryptocurrency via private keys or hardware wallets from others. This is a bad idea.”
CZ recommends:
Always transfer money to a personal wallet that you fully control.
Ask the sender to transfer directly to your personal wallet instead of using a pre-set wallet.
“The sender can still access your funds. Transfer assets to your wallet, or better yet, ask them to send directly,” CZ emphasized.
Why Is This Dangerous?
CZ explained that having two people with access to a private key would lead to a situation where it is impossible to determine who moved or lost the assets.
“When money is lost (whether by hackers or someone with access), it is almost impossible to prove who caused it.”
Life After Binance
CZ resigned as CEO of Binance in November 2023 after admitting to violations of anti-money laundering (AML) laws in the United States. He was sentenced to 4 months in prison and will be released in September 2024.
Currently, CZ is focusing on blockchain projects, artificial intelligence (AI), and biotechnology, while distancing himself from Binance.
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