Third-Party Risk in Monero Ecosystems: Why Non-Custodial Wallets Eliminate Exchange Counterparty Risk
A Monero user holds XMR on a cryptocurrency exchange because it feels simpler than managing a wallet. The exchange handles backups, password resets, and market access. Then the exchange is hacked, becomes insolvent, or faces regulatory seizure. The user’s funds disappear not because Monero’s protocol failed, but because a third party controlled the private keys. …
