For the uninformed, cryptocurrency is synonymous with scam. For the rest of us, it is a thriving, dynamic market that boasts unprecedented growth and practically unlimited potential.

The rate at which the market has grown over the past few years has not just attracted savvy investors. Criminals have also noted opportunities to take advantage of the cryptocurrency market. Since its inception, crypto has been stolen.

Individual cryptocurrency holders have fallen victim to theft, losing their Bitcoin, Ethereum, or altcoins to hackers and thieves.

However, the majority of losses have occurred by way of cryptocurrency exchanges. As a result, developers have been hard at work devising new security innovations.

Most exchanges now offer a multitude of standard security features designed to address vulnerabilities within their systems. Safeguards such as two-factor authentication, cold storage, and encryption are now standard. Some exchanges even offer real-time surveillance and security monitoring to mitigate hacking risks.

However, as evidenced by the recent alleged verification data leak at Binance, the world’s largest cryptocurrency exchange, threats still exist.

The Binance security leak has the potential to affect as many as 60,000 individual investors. According to sources, the data in question is individual investor know-your-customer (KYC) related. The hacker allegedly tried to blackmail Binance to the tune of 300 bitcoin, or approximately $3.5 million dollars.

Binance founder and CEO Changpeng Zhao (CZ) has repeatedly downplayed the threat on Twitter, sharing that Binance is investigating. However, CZ states it is likely an empty threat meant to discredit both Binance and the industry in general.

What is already in place that can allow investors to both reduce their own risk, and contribute to the collective security of the entire market?

One of simplest solutions is also the most obvious. Even brand new exchanges offer powerful, comprehensive security solutions to protect themselves and investors from hackers.

The selection of exchanges, now at 260 and counting, is a smorgasbord of custom trading options, with unique interfaces and security features. The entire exchange market has adopted a strong focus on customer service, striving to meet the needs of a variety of users, serving retail investors, professional traders, and even institutional investors.

In this market, most, if not all new exchanges have a strong focus on security. Multi-layer security is the norm, rather than the exception. Rather than focusing on elegant interfaces or user-friendly communication tools, the focus is security. Exchanges such as newcomer ecxx, whose stated goal is to be a leader in digital asset exchanges, tout security as one of their most appealing features.

The promise of protection from exchanges like ecxx is important. Investors are seeking newer, better, and more robust trading choices, while at the same time not sacrificing the protection that they have come to expect. As with fiat banking, customers seem to want it all, and these new exchange options are seeking to provide just that.

New exchanges offer even more potential, partially due to an increasing interest from major investors. The need for digital currency trading platforms is growing. Current platforms are immensely profitable.  Investors have taken note.

New derivatives exchange Blade, for example, raised $4.3 million in seed funding from stakeholders (including Coinbase), individual investors, and venture capital funds. Drawn by the opportunity to see a perpetual swap contract see success, these investors are counting on the success of this new, relatively untested form of futures trading.

Blade is not alone in securing millions in funding. MidChains is a cryptocurrency exchange targeting the recent interest in cryptocurrency from institutional investors. The soon to be launched exchange has the backing of one of the world’s largest sovereign wealth funds, Mubadala Investment Capital. Both the exchange and investment fund are based in Abu-Dhabi.

The support new exchanges are receiving is astounding. However, given the potential for profitability, the forecasted growth of distributed ledger technology, and a newfound interest in cryptocurrency investments, both new exchanges and investors are taking a step with tremendous payoff potential.

However, as the market continues to grow and new exchanges secure their positions, security needs to remain at the forefront of everyone’s priority list.

The post Strong Security: The New Norm for Cryptocurrency Exchanges appeared first on ZyCrypto.

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