What to Do If Your Exchange Is Hacked or Freezes Withdrawals

Published 5 August 2026 · 7 min read

The immediate steps

If withdrawals are still open, withdraw. Do not wait for an official statement — by the time an exchange confirms a problem, withdrawals are usually already suspended. Historically the window between the first rumours and the freeze has been hours, not days.

Move funds to a wallet you control, not to another exchange. Then change the password and revoke sessions on any account sharing that password, and check whether an API key with withdrawal rights was ever issued.

If you are already locked out

Document everything immediately: balances, transaction history, correspondence, screenshots with timestamps. In insolvency proceedings, claims are evidenced by records, and the exchange's own interface may become inaccessible without warning.

Then be aware of the second wave. Every major failure is followed by "recovery services" contacting affected users. These are without exception scams — there is no service that can retrieve funds from an insolvent exchange, and paying one simply adds a second loss on top of the first.

The structural lesson

Coins on an exchange are an entry in that company's database and a claim against a business that may fail. That is acceptable for the amount you are actively trading and has repeatedly proven unacceptable for savings.

The durable fix is separation: trade with what you need on the venue, hold the rest in self-custody, and use a read-only tracker to see everything in one place. Monitoring a wallet requires only its public address, so consolidating your view costs you nothing in security.

Turning this into something automatic

The gap between knowing what to do and doing it is closed by automation, not discipline. You will be asleep, in a meeting, on a flight, or simply not thinking about markets on the day it matters. That is not a discipline failure — it is the normal condition of having a life, and any system that ignores it is badly designed.

So convert every conclusion from this article into a condition that can be watched for you. A level you would act on becomes a price alert. A move size that would change your view becomes a percentage alert. A whole segment of the market you cannot follow coin by coin becomes one bulk rule that scans it and tells you when something unusual happens.

Set them, then close the app. The point of exchange failure is not to make you watch more closely — it is to let you stop watching entirely and still be there when it counts. CoinPriceAlert sends push notifications for crypto, stocks, metals and forex, with quiet hours so nothing wakes you at 4am for a move you would not have traded anyway.

Costs that quietly eat the return

The return you see on a chart is not the return you get. Between the chart and your account sit trading fees, the spread between bid and ask, slippage on anything larger than a small order, network fees when moving assets, and conversion costs if you are not trading in your home currency.

None is large in isolation. Together, on an actively traded account, they routinely consume a meaningful share of gross returns — and unlike market moves, they are guaranteed. This is the strongest practical argument for trading less: every round trip you avoid is a cost you certainly save, against a gain you only might have made.

Slippage deserves particular attention because it is worst exactly when you most want to act. Liquidity thins during violent moves, so the market order you place during a crash fills materially worse than the screen suggested. Limit orders paired with alerts are the standard answer: the alert tells you the level arrived, the limit order controls what you pay for it.

The mistakes that cost the most

Over-alerting. Forty alerts is not forty times the coverage of one — past a certain density, additional alerts reduce total attention rather than increasing it.

Reacting to a move without checking what caused it. A fall that happens while the whole market falls is a different event from a fall that happens alone, and the correct response differs completely. Checking correlation first takes ten seconds and prevents most panic decisions.

Changing the plan mid-move. The level you chose while calm is better than the one you will choose while watching a candle. If you find yourself widening a stop or moving a target during volatility, that is the moment to close the app rather than the moment to act.

Never reviewing. Most people set up exchange failure once and never look at whether it worked. A short monthly review — what fired, what you did, what you would change — compounds faster than any refinement of the setup itself.

Risk, defined properly

Getting the definition right changes what you actually do. Volatility is how much a price moves. Risk is the probability of a permanent loss of capital — of the reason you owned something ceasing to be true. An asset can be extremely volatile and low-risk for a patient holder, or barely move and be extremely risky if it is quietly failing.

The practical difference: volatility is survived with position sizing, risk is avoided with research. Sizing a position so that a 60% drawdown is uncomfortable rather than ruinous handles volatility. Nothing about sizing protects you from owning something whose thesis has broken.

Which is why both jobs need doing. Size for the volatility, research for the risk, and set an alert at the level where the thesis would be in question — so the review is triggered by the market rather than by whether you happened to be paying attention that week.

The same thinking applied outside crypto

Treating crypto as a separate universe from your other holdings is a mistake of framing. Levels, position sizing, deciding in advance and being notified rather than watching apply identically to equities, metals and currencies. The parameters change — a 1% move in a major currency pair is a significant event where a 1% crypto move is background noise — but the method does not.

Watching them together also reveals relationships that are invisible one market at a time. The dollar's strength sets the backdrop for every risk asset. Gold and Bitcoin are both pitched as hedges against currency debasement, and their divergences say something about which story the market is currently believing. When large-cap tech sells off hard, crypto rarely rallies for long.

That is the argument for one watchlist rather than four apps: a portfolio is a single thing, and the correlations between its parts are usually more important than any individual holding.

Why exchange failure matters more in crypto than elsewhere

Techniques borrowed from equities often break here, and it is worth knowing why. It never closes, so there is no overnight gap in which to think — the largest moves routinely happen while your part of the world sleeps. It is far more volatile, so a position sized like an equity position behaves nothing like one. And it is heavily retail-driven, which makes sentiment swings sharper and reversals faster.

That combination is exactly why exchange failure is worth getting right here specifically. Approaches that are merely helpful in a nine-to-five market become load-bearing in one that runs continuously and moves several times as fast.

It is also why automation beats attention. You cannot watch a 24/7 market; you can only decide in advance what would make you act, and arrange to be told when it happens. Everything below is built on that principle.

Never miss a move in the markets you follow

Set a price or percentage alert once and get a push notification the moment it triggers — free, with quiet hours so nothing wakes you at 3am.

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