<p>Nice question. I assume the following:</p>
<ul>
<li>Most of the funds are stored in &quot;Cold wallets&quot;.</li>
<li>All the transactions are made from &quot;Hot Wallets&quot;</li>
<li>There is an <strong>automatic</strong> system that detects that the hot wallets need to be recharged.</li>
</ul>
<p>I don't think such operations are made by a human. Maybe there is a human who checks such transactions. But everything is done automatically.</p>
<p>We can also assume that the CEO has access to the keys and funds. But we will never be 100% sure. It's crypto. That's why different decentralized platforms like UniSwap are popular right now.</p>

CC BY-SA 4.0
2021-04-15T10:56:30.510Z
2021-04-15T10:56:30.510Z
Hans Holder
<p>So hear me out. I understand exchanges have hot/cold wallets and mostly use their hot wallets. But at some point they need to send crypto from their cold wallet to their hot wallet.</p>
<p>Who does this? The CEO &amp; only the CEO? Technically whoever holds the password to these keys could send it to any address and it not be retrievable. The person would be in a lot of trouble but the crypto would probably be unobtainable.</p>
<p>Even if that crypto is &quot;insured&quot; the insurance company would probably only be able to payout in fiat.</p>
<p>Basically, how do exchanges keep your crypto secure?</p>

CC BY-SA 4.0
2021-03-16T03:11:37.273Z
I would imagine some sort of multisig arrangement for the cold storage and employees only have access to the hot wallet. Similar to how bank employees get a cash drawer; they could run away with the cash, but it's not enough for it to be worth going to jail.
m1xolyd1an
CC BY-SA 4.0
2021-03-16T07:21:46.810Z
Voting to leave this open. While the details of actual setups are likely speculation, there are useful technical answers about what approaches are possible to mitigate risks.
Pieter Wuille
CC BY-SA 4.0
2021-05-15T11:48:36.547Z
Related: https://bitcoin.stackexchange.com/a/105889/5406
Murch
<exchanges>
How do exchanges manage their bitcoin/crypto? It only takes 1 employee with private keys to steal it all
Trevor
# How do exchanges manage their bitcoin/crypto? It only takes 1 employee with private keys to steal it all

(Asked by: username_0 on 2021-03-16)

So hear me out. I understand exchanges have hot/cold wallets and mostly use their hot wallets. But at some point they need to send crypto from their cold wallet to their hot wallet.

Who does this? The CEO & only the CEO? Technically whoever holds the password to these keys could send it to any address and it not be retrievable. The person would be in a lot of trouble but the crypto would probably be unobtainable.

Even if that crypto is "insured" the insurance company would probably only be able to payout in fiat.

Basically, how do exchanges keep your crypto secure?

**Tags:** exchanges

> **Comments:**
> **username_1**: I would imagine some sort of multisig arrangement for the cold storage and employees only have access to the hot wallet. Similar to how bank employees get a cash drawer; they could run away with the cash, but it's not enough for it to be worth going to jail.  
> **username_2**: Voting to leave this open. While the details of actual setups are likely speculation, there are useful technical answers about what approaches are possible to mitigate risks.  
> **username_3**: Related: https://bitcoin.stackexchange.com/a/105889/5406  

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## 1 answers

### Answer by username_4 on 2021-04-15. Score: 1 | Accepted answer

Nice question. I assume the following:

* Most of the funds are stored in "Cold wallets".
* All the transactions are made from "Hot Wallets"
* There is an **automatic** system that detects that the hot wallets need to be recharged.

I don't think such operations are made by a human. Maybe there is a human who checks such transactions. But everything is done automatically.

We can also assume that the CEO has access to the keys and funds. But we will never be 100% sure. It's crypto. That's why different decentralized platforms like UniSwap are popular right now.


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