CertiK Urges Exchanges To Cap Hot Wallet Holdings
By Damilola Esebame
AI summary of the source article
Blockchain security firm CertiK has urged crypto exchanges to implement hard dollar caps on hot-wallet holdings alongside cold-storage ratios. The recommendation follows a $6.3 billion hot-wallet hack of Binance.
Why it matters
CertiK stated that "cold storage is a useful measure of online exposure, but it is not a standalone security score," noting that hard dollar ceilings and circuit breakers would help limit potential losses.
Key facts
- CertiK proposed that exchanges set hot-wallet limits based on customer liabilities, withdrawal needs, and an absolute loss ceiling.
- The recommendation follows a $6.3 billion hot-wallet hack of Binance, which replenished roughly 98% of affected tokens.
- Regulatory cold-storage minimums range from 80% in South Korea to 98% for licensed trading platforms in Hong Kong.
Source excerpt · FinanceFeeds
Blockchain security firm CertiK has called on crypto exchanges to set hard dollar limits on hot-wallet holdings instead of relying solely on cold-storage ratios to measure security. The recommendation follows the $6.3 billion hack of Binance’s hot wallets, which exposed the gap between high cold-storage percentages and actual loss prevention. Cold-Storage Ratios Measure Exposure, Not Security Cert…