Cybersecurity firm urges shift from storage ratios to absolute exposure limits

Cryptocurrency exchanges face growing pressure to strengthen their custody practices following a high-profile breach. CertiK, a blockchain cybersecurity specialist, has advised platforms to impose strict dollar-based caps on holdings in hot wallets—the systems that must remain online to process trades and withdrawals—rather than relying exclusively on cold-storage percentages.

The firm’s research team highlighted that high levels of offline storage help reduce online exposure but offer diminishing returns once ratios reach extreme figures. At those points, further increases yield smaller security gains while complicating daily operations.

Regulators set varying cold storage benchmarks

Authorities worldwide have introduced minimum requirements for cold storage to protect customer assets. South Korea mandates at least 80 percent of client holdings by value remain offline. Singapore sets the threshold at 90 percent, Japan at 95 percent, and Hong Kong at 98 percent for licensed platforms.

Recent disclosures from major exchanges illustrate the current landscape. Gate.io reported that 88.26 percent of its assets are held in cold storage, while Coinbase stated it maintains more than 99 percent of customer funds offline.

Proposed framework balances liquidity with loss controls

CertiK outlined a practical alternative focused on enforceable limits per asset and blockchain. Exchanges should apply the strictest of three calculations: a percentage of customer liabilities, estimated daily withdrawal requirements, and an absolute loss ceiling tied to the platform’s financial recovery capacity.

This structure preserves operational flexibility for smooth service delivery while incorporating automatic circuit breakers to cap maximum potential losses. Rigid percentage rules, the firm noted, can slow withdrawals, force hurried transfers, and concentrate risk in key-management systems.

Binance recovers most stolen assets amid ongoing laundering attempts

The recommendation comes amid developments at Binance following its record breach, which targeted hot wallets. The platform reported replenishing approximately 98 percent of affected tokens and indicated it would absorb the associated losses. The remaining portion involves lower-liquidity assets and will take longer to restore.

Blockchain intelligence firm Elliptic identified attempts by North Korea-linked actors to launder roughly $430,000 through six new memecoins on the NEAR network. Liquidity pools obscured some transfers, but on-chain analysis confirmed traceability.

CertiK’s guidance comes as exchanges continue to refine custody strategies in response to these events. The focus on measurable hot-wallet limits aims to provide clearer protection for users while supporting reliable market operations.