Exchange or offline wallet? What should you do?

There appears to be a lot of advice on the various blogs, chats and Internet sites about where you should store your crypto currencies and the general theme appears to one that does not trust the Exchanges. I do think we need to be cautious here as there are both pros and cons for both methods of storage. Keeping your bitcoins on an Exchange does have a small risk associated with your coins being stolen from a successful hack. However unless you are really careful and meticulous with your own wallet you could equally end up with no coins if you should lose your phone or any of the private keys that are needed to access your funds. We have all seen stories of people that have lost their bitcoins through a hard drive crash. Anyway the question you need to be asking yourself is whether you are confident enough to manage the storage of your bitcoins yourself. Anyone new to Bitcoin quickly finds out how the whole process of purchasing and keeping bitcoins is rather daunting if you are a beginner. You would really have to think about storing your own bitcoins on an offline wallet, a phone or a paper wallet if you are not particularly technically savvy. The same holds true for most alternative crypto currencies.

Now there is a fair amount of paranoia amongst the crypto communities that believe holding your coins on an Exchange is going to end up with you losing all your money as you are not in charge of your wallet and your money is at the mercy of the Exchange. If you have a look at the more established Exchanges such as Coinbase, Kraken and Poloniex for example you will see that they do go to considerable lengths to keep the coins they hold as secure as they can. If you are new to the game you need to consider whether the controls that the Exchange has are going to give you more comfort than your own controls that you keep in place. Now for a tech savvy crypto maniac then off course he can do that but with all the new people coming on board now they need to be given balanced and fair advice with regards to this.

I do not propose one method over the other but I would like to see a more balanced view on this along with realistic and supportive advice rather that all the paranoid anti Exchange hype that you hear all the time. Perhaps spread your coins across a number of exchanges and spread your risk including keeping some in your own wallet. I would be happy to get other peoples views on this so please feel free to comment.