3. Loss of Assets: Not Just a Technical Risk

DPTs are stored and accessed through digital wallets secured by private keys. While this decentralised approach is empowering, it also introduces certain responsibilities.

If your private keys or account credentials are lost or compromised, there may be no way to recover your assets. There is no central authority to reset access or reverse a transfer.

Bad actors are also part of the landscape. Phishing attempts, impersonation scams, and malware are some of the tactics used to deceive users. Even sophisticated platforms have fallen victim to cyber-attacks, resulting in substantial asset losses.

Coinut employs strict security protocols, including two-factor authentication (2FA), cold wallet storage, and internal audits to reduce these risks. However, it’s equally important for users to adopt safe practices, such as securing personal devices and being cautious about communications that appear suspicious.

How can I lose my Crypto assets?

1. Trading Losses and Market Volatility

Many people lose money by buying high (due to excitement or FOMO) and selling low (due to panic), especially in the highly volatile crypto market. Short-term trading, especially with leverage, can amplify losses for inexperienced traders.

2. Scams and Fraud

Common scams include fake wallets, phishing attacks, Ponzi schemes, pump-and-dump schemes, and upfront deposit scams. Scammers may try to trick you into sending crypto to fraudulent addresses, sharing your private keys with the, or investing in fake projects. Coinut employs strict security protocols, including two-factor authentication (2FA), cold wallet storage, and internal audits to reduce these risks. However, it’s equally important for users to adopt safe practices, such as securing personal devices and being cautious about communications that appear suspicious.

3. Theft and Security Breaches

Hacks of exchanges or personal wallets can result in the loss of your crypto assets. Cyber-attacks and financial crime are significant risks in the crypto space. While, (Inset security measures that Coinut has in place to address these concerns), it is also important for our users to adopt specific security measures like 2FA, utilising complex passwords, and adopting proper safekeeping techniques for passwords and private keys to help address these concerns. 

4. Loss of Access

While we at Coinut help you maintain your DPTs in a centralised manner, if you transfer your DPTS to an external wallet and then lose the private key/seed phrases or wallet password for any such external wallets, you will likely permanently lose access to your DPTs. To note, sending DPTs to the wrong address is also irreversible. Always carry out a test trade with a much smaller amount first, when sending to a new wallet. 

5. Operational and Technical Failures

Technology outages, network congestion, or bugs in wallet software can prevent you from accessing or selling your crypto when needed.

6. Poor Risk Management and Overleveraging

Investing more than you can afford to lose or using excessive leverage can result in forced liquidations and significant losses. While Coinut does not allow for our retail customers to carry out trades on our platform using leverage, we would also suggest not doing so elsewhere either, as this exposes you to greater risk than you may be familiar with.  

7. Regulatory and Legal Risks

While this is of lesser concern in Singapore, and your DPTs are safe with us, some jurisdictions may not have such mature regulatory oversight and laws governing DPTs, and therefore if your DPTs are custodised in such regions, trying to access and/or liquidate this may be difficult.