Locking the Door but Leaving the Safe to Others? The 'Dual Structure' Trap for Crypto 'HODLers'

Clabo Co., Ltd. (Headquarters: Minato-ku, Tokyo; Representative Director: Ikuma Ueno) conducted a survey titled 'Actual Survey on Asset Storage Methods and Security Measures by Investment Style' targeting 746 individuals with experience in cryptocurrency investment.

The survey results revealed that 59.3% of the largest group of respondents, the 'HODL (long-term hold)' faction (30.3%), store their long-term assets on exchanges.

Furthermore, while the HODL group's rate of enabling two-factor authentication (2FA) on all services was the highest among all investment styles at 45.1%, the rate of never having migrated assets to a personal wallet also reached 45.1%, indicating a gap between security awareness and actual asset management behavior.

The report analyzes the high exchange storage rates among small-scale holders with less than 10,000 yen in assets and new entrants with less than one year of investment experience, as well as the fact that 59.4% of veterans with over five years of investment experience also store assets on exchanges.

It also revealed that 53.1% of the HODL group have encountered scams or phishing, and 9.7% have actually lost funds.

Check the full survey results

■ Survey Content

The largest investor group, the 'HODL faction' of 226 people: The contradiction of 60% leaving assets on exchanges

59.3% of the 226 HODLers leave assets on exchanges: The contradiction revealed by the survey on crypto investors | Clabo Co., Ltd.

30.3% are the largest HODL faction: Self-reported 'long-term holding'

When asked about their investment style in this survey, the largest group was the 'HODL (long-term hold)' faction with 226 people, accounting for 30.3% of the total.

This means one in three investors primarily focuses on long-term holding, confirming it as a dominant strategy in the cryptocurrency market.

Long-term holding refers to a strategy of holding assets for several years without being swayed by short-term price fluctuations.

It is considered the simplest and most reproducible approach for investors expecting long-term price increases in major assets like Bitcoin and Ethereum.

However, for the 'long-term holding' strategy to be viable, the safe storage of those assets is a fundamental prerequisite.

The longer the holding period, the greater the accumulated security risks that can occur during that time.

59.3% of HODLers 'leave assets on exchanges': Worst among all styles

When cross-tabulating the storage location of long-term assets by investment style, a striking figure emerged.

59.3% of the HODL group responded that they 'leave assets on the exchange,' the highest rate among all investment styles, excluding the 'none' category.

Ideally, long-term holdings should be strictly managed in cold wallets, but the reality is the exact opposite.

Furthermore, the hardware wallet (HW) usage rate is noteworthy.

The 8.8% rate for the HODL group is lower than that of the 'both' or 'active trading' groups, indicating that this group has the weakest sense of self-custody.

The data clearly shows that the strategy of 'not moving' assets has been replaced by 'not bothering to move' them.

'No wallet migration experience' at 45.1%: HODLers are the least likely to move assets from exchanges

Nearly half of HODLers have never used a personal wallet

When asked about their experience migrating assets from an exchange to a wallet, 45.1% of the HODL group answered that they have 'never migrated.'

This means that 102 out of 226 HODLers have never transferred their crypto assets to a personal wallet since purchasing them.

The group that should be the least active in moving assets has, as a result, fallen into the behavioral pattern of 'never moving assets from the exchange.'

'Long-term holding' and 'not performing migration procedures' are fundamentally different concepts.

Nevertheless, the fact that nearly half of the HODL group equates the two indicates a significant disconnect between strategy and implementation.

Migration hurdles may be accelerating 'HODLing'

Why are HODLers less likely to migrate to a wallet?

The background likely involves psychological and technical hurdles associated with the wallet migration process.

Managing seed phrases, selecting networks, performing test transactions – the migration process is far from simple for beginners.

It is likely that many investors keep putting it off, saying 'I'll do it someday,' and as their holding period lengthens, they end up defining themselves as 'HODLers.'

However, the longer the migration is postponed, the longer the assets remain exposed to exchange risks.

Events such as exchange bankruptcy, hacking, and withdrawal suspensions are not rare occurrences, as past examples show.

For those serious about long-term holding, it is essential to invest the initial few tens of minutes of work to establish a self-custody system.

Surprising fact: HODLers have the highest 2FA adoption rate at 45.1%

Highest defensive awareness – but assets remain on exchanges

A surprising aspect of the HODL group is their high rate of enabling two-factor authentication (2FA) on all services.

45.1% of the HODL group responded that they have 'set up 2FA on all services,' the highest rate among all investment styles.

Ironically, it is the HODL group that most strongly recognizes the importance of security.

Yet, the same HODL group leaves 59.3% of their long-term assets on exchanges.

This reveals a peculiar dual structure of defense: 'locking the door but leaving the safe in someone else's hands.'

The gap between security awareness and action: What is stopping them?

The HODL group's HW ownership rate is 46.9%, and their 2FA adoption rate is 45.1% – both are comparable to other styles.

How can we explain the contradiction that 59.3% of their long-term assets are left on exchanges?

One possible hypothesis is that 'they have security knowledge, but the priority of migration is low.'

Setting up 2FA takes only a few minutes, whereas wallet migration, from seed phrase management to confirming transfers, can take tens of minutes to several hours.

As a result of continuously postponing this 'troublesome task,' the long-term holding period may have become a period of neglect.

Another hypothesis is trust in exchanges.

The belief that 'as long as I have 2FA enabled, it's safe on the exchange' may be shared with a certain degree of rationality among the HODL group.

Identifying the 'most vulnerable layer' within the HODL group

Damage faced by the HODL group: 9.7% have actually lost funds

Summary

For the detailed report including the above content, please refer to the main article text.

■ Survey Overview

Survey implementation