Crypto Exchange Safety Checker
Assess Your Exchange's Safety
Cryptopia's collapse taught us that not all exchanges are equally secure. Answer these 6 questions to understand if your exchange meets basic security standards.
Security Assessment Results
Based on the Cryptopia collapse and other exchange failures, this assessment helps you understand basic security factors.
Remember: If your exchange shows high risk, consider moving your funds to a secure wallet.
Cryptopia was once one of the biggest names in altcoin trading. At its peak, it offered over 900 cryptocurrencies - far more than Binance, Coinbase, or Kraken at the time. If you were into obscure tokens like PIRL, PAC, or Dotcoin back in 2017 and 2018, Cryptopia was your go-to platform. It was based in New Zealand, had a stablecoin tied to the NZ dollar, and even ran a daily lottery where users could win free crypto. It felt like a wild west exchange - exciting, risky, and full of opportunity.
But none of that mattered when the system collapsed.
On January 14, 2019, Cryptopia announced a massive hack. Hackers stole around NZ$16 million in digital assets. What followed wasn’t just a security failure - it was a full-blown implosion. The exchange stopped trading. Accounts were frozen. Customer support vanished. By May 2019, the New Zealand High Court ordered its liquidation. Today, Cryptopia doesn’t exist. No website. No app. No customer service. Just a legal mess that still hasn’t been fully resolved.
How Cryptopia Grew So Fast
Cryptopia started in July 2014, founded by two guys in Christchurch, New Zealand. At first, it was small - just 30,000 users. But when the crypto boom hit in 2017, everything changed. Prices for Bitcoin and Ethereum skyrocketed. People who had never traded before started buying altcoins. Cryptopia was ready. It listed coins no one else would touch - dozens of low-cap tokens with no real use case, but high hype.
By early 2018, it had over 1.4 million users. That’s more than most banks in New Zealand. Its trading volume sometimes exceeded the entire New Zealand Stock Exchange. The platform didn’t have the cleanest interface - users called it clunky - but it made up for it with volume and variety. You could trade Dogecoin, Litecoin, and even obscure tokens like BitBay or Zcoin all in one place.
It also had features other exchanges didn’t. A Coininfo page gave detailed stats on each coin. An arbitrage tool showed price differences between exchanges. And the daily lottery gave users a small chance to win free crypto just for logging in. For retail traders chasing quick gains, it was addictive.
The Hidden Problems
Behind the scenes, things were falling apart.
Cryptopia’s infrastructure couldn’t handle the growth. In early 2018, the exchange froze trading for Dogecoin and Litecoin because their systems were overloaded. New account creation was temporarily shut down. Withdrawals took days - sometimes weeks. Users complained about wallets that wouldn’t sync, coins that disappeared from balances, and support teams that never replied.
Customer service was a joke. People reported being told to "fuck off" if they asked for help. The only way to get a response was to tweet at them. And even then, replies were rare.
Then there was the NZDT stablecoin - a project meant to tie crypto to the New Zealand dollar. It sounded smart. But when ASB Bank, one of New Zealand’s biggest banks, cut off Cryptopia’s accounts, the stablecoin died overnight. That wasn’t just a technical problem - it was a sign the exchange had no real banking relationships. No compliance. No backup plan.
Internal reports later revealed a toxic workplace culture. Founders clashed. Employees quit. Leadership was chaotic. There was no clear security team. No proper audits. No insurance for user funds. It was a house of cards - and everyone was pretending it was a skyscraper.
The Hack That Killed It
On January 14, 2019, Cryptopia posted a message on its website: "We’ve been hacked. We’re investigating. Trading is suspended."
They claimed attackers stole 16 million NZD worth of crypto - mostly Ethereum, Bitcoin, and Litecoin. But right away, users started asking questions.
Why did the hack happen right after a major withdrawal spike?
Why did the exchange’s internal wallet keys seem to be exposed for weeks before the breach?
And why did some users report their coins disappearing before the official announcement?
Some people believed the hack was fake - that the owners had stolen the money themselves and blamed hackers to cover it up. One G2 review claimed Cryptopia used "Dotcoin from the beginning to silently take criminal action." Another user said their PIRL wallet was broken for an entire month - and when they tried to withdraw, the coin’s value dropped 90% overnight.
It didn’t matter what really happened. The damage was done. Trust vanished. Users flooded forums with stories of lost savings. Reddit threads exploded. The New Zealand government stepped in. Liquidators were appointed. The court case began.
The Aftermath: A Legal Nightmare
Cryptopia’s liquidation became one of the most complicated crypto bankruptcies in history.
Over 900,000 users from 190 countries were affected. The liquidators found only NZ$70 million in recoverable assets. But creditors - that’s you and me - had claimed NZ$180 million in losses. That means most users lost 60% to 70% of their money.
Recovering funds was a nightmare. Cryptopia didn’t use cold storage properly. Wallet keys were stored online. Some coins were moved to unknown wallets. Others were sold off before the hack. Legal battles dragged on for years. In 2022, the liquidators reported only partial recovery. No one got their full balance back.
And here’s the kicker - Cryptopia never had insurance. Unlike exchanges like Coinbase or Kraken, which hold user funds in segregated accounts and carry insurance policies, Cryptopia treated customer assets like their own. When the money disappeared, so did your claim.
Why Cryptopia Failed When Others Survived
Many exchanges failed in the early days of crypto. But Cryptopia stands out because it wasn’t just unlucky - it was irresponsible.
Compare it to Binance. Binance also grew fast. But they invested in security. They hired auditors. They built cold storage. They had compliance teams. Cryptopia had a guy in New Zealand who managed the server from his basement.
Other exchanges had banking partners. Cryptopia lost theirs. Other exchanges had customer support teams. Cryptopia had Twitter replies. Other exchanges had insurance. Cryptopia had promises.
It wasn’t about the number of coins. It wasn’t about the lottery. It was about basic business hygiene. No security. No oversight. No accountability. And when the pressure came, the whole thing broke.
What You Can Learn From Cryptopia
If you’re trading crypto today, Cryptopia’s story isn’t history - it’s a warning.
- Never keep large amounts on an exchange. If you’re not actively trading, move your coins to a hardware wallet.
- Check if the exchange has insurance. Most big ones do. If they don’t, assume your funds are at risk.
- Don’t trust hype. If an exchange lists 900 coins, ask why. Most of them are worthless. The real ones are on the top 20.
- Look at the team. Who runs it? Do they have a track record? Are they transparent?
- Watch for red flags. Slow withdrawals? No customer support? Sudden delistings? Run.
Cryptopia didn’t fail because crypto is risky. It failed because the people running it didn’t care enough to do things right.
Is There Any Way to Get Your Money Back?
No.
Not anymore.
The liquidation process is over. The court has closed the case. The remaining assets were distributed in 2023. Most users received pennies on the dollar - if anything at all.
Some people tried to sue. Others filed claims. A few got partial refunds after years of waiting. But for the vast majority, the money is gone.
There’s no active website. No support email. No phone number. Cryptopia is dead. And the only thing left is a lesson.
Final Verdict: A Cautionary Tale
Cryptopia wasn’t a scam from day one. It started as a real platform - just a badly run one. It gave people what they wanted: access to obscure coins, fast trading, and a sense of community. But it never built the foundation to survive.
It’s easy to look back and say, "I should’ve seen it coming." But back then, everyone was chasing gains. No one asked about security. No one checked the team. No one cared about compliance.
Cryptopia’s collapse wasn’t just a hack. It was a failure of responsibility. And it’s one of the most important lessons in crypto history.
If you’re thinking of using a small, unknown exchange today - ask yourself: Would you trust them with your life savings? If the answer isn’t a clear "yes," then don’t use them. Cryptopia didn’t just lose money. It lost trust. And once that’s gone, nothing comes back.
Ali Korkor
October 29, 2025 AT 10:10Bro, this is why you never keep coins on an exchange. I lost everything in 2018 on a similar site. Learned the hard way. Now I use a Ledger and sleep like a baby. Your money is your responsibility. No one else is gonna save it for you.
Simple as that.
MANGESH NEEL
October 29, 2025 AT 18:00Oh wow another crypto martyr story. Let me guess - you didn’t do your own research, you just trusted some guy on Reddit with a ‘1000x gem’ and now you’re crying because you didn’t get your 0.0000123 BTC back? Get over it. The market eats the naive. Cryptopia didn’t fail because it was evil - it failed because you were stupid enough to think a NZ-based website with a lottery was a bank.
And don’t even get me started on those ‘dotcoin’ scams. That wasn’t a coin, that was a pyramid scheme with a whitepaper.
Wake up. The blockchain doesn’t care how much you cried.
Serena Dean
October 30, 2025 AT 11:03Thank you for writing this. I’ve been telling my friends for years - if an exchange has more than 500 coins, it’s not a marketplace, it’s a casino. And if they don’t have insurance? You’re basically lending them your life savings.
I moved all my coins to cold storage after I saw how fast Cryptopia collapsed. No regrets. Even if the price goes up 10x, I won’t risk it again.
You’re not being paranoid - you’re being smart. Keep spreading this message.
Michael Folorunsho
October 30, 2025 AT 22:53Let’s be real - this whole thing was a joke from day one. A New Zealand exchange? With no banking partners? No compliance? What did they think was gonna happen? This isn’t crypto failure - this is Western incompetence dressed up as innovation.
Meanwhile, real institutions in Singapore and Switzerland are building proper custody solutions. But no, we gotta have some guy in Christchurch running a server from his mom’s basement while trading ‘Pirl’ and ‘Dotcoin’ like it’s 2013.
Pathetic. And the fact that people still don’t get it? That’s the real tragedy.
James Young
October 31, 2025 AT 04:39Everyone’s acting like this was a surprise. The red flags were screaming. Withdrawals taking weeks? Support saying ‘fuck off’? A stablecoin tied to a country whose biggest bank cut them off? That’s not incompetence - that’s fraud waiting to happen.
And now people are surprised? You think the founders didn’t know the keys were exposed? You think they didn’t see the withdrawal spike before the ‘hack’? This was a controlled demolition. The ‘hack’ was the exit strategy.
Don’t be fooled. This wasn’t a hack. It was a heist with a PR team.
Jonathan Tanguay
October 31, 2025 AT 13:41Look I’ve been in this space since 2015 and I’ve seen 12 exchanges die. Cryptopia was the most predictable. They had zero security protocols. No multi-sig. No cold storage. No audits. No KYC. No compliance. No insurance. No backup servers. No incident response plan. No team structure. No HR. No legal counsel. No CFO. Just two guys in New Zealand who thought ‘if we list enough coins, people won’t notice we’re broke.’
And the fact that users kept feeding it money? That’s the real horror story. People were buying Dogecoin with their rent money and thinking ‘this is how you get rich.’ No. This is how you lose everything. And now you’re surprised? You didn’t read the signs. You were too busy chasing memes.
And now you want the government to bail you out? Nah. You got played. Own it. Next time, do your homework. Or don’t trade at all. Either way, stop acting like a victim.
Dick Lane
November 1, 2025 AT 05:42I lost my entire portfolio in that hack. I was 19. I had saved for two years. I thought Cryptopia was legit because it had a ‘Coininfo’ page. I didn’t know what cold storage was. I didn’t know what KYC meant.
It took me three years to even talk about it without crying.
But I’m not mad at them. I’m mad at myself. I didn’t ask the right questions. I didn’t dig. I just saw ‘1.4 million users’ and thought ‘that’s safe.’
If you’re reading this and you’re new - please, just listen. Don’t be like me. Learn first. Trade second. Always.
Elliott Algarin
November 2, 2025 AT 22:53It’s funny how we romanticize the early days of crypto. We call it the wild west like it’s some kind of adventure. But it wasn’t adventure - it was a free-for-all with no rules, no referees, and no safety nets.
Cryptopia wasn’t evil. It was just… unprepared. Like a kid running a lemonade stand in a hurricane.
And we all cheered because we wanted to believe in it. We wanted to think that anyone could build something big. But some things need structure. Some things need responsibility. And crypto? It needed both.
Now we know.
Maybe that’s the real gift Cryptopia gave us.
Norman Woo
November 4, 2025 AT 04:44what if the hack wasnt real? like… what if the founders just pulled the plug and said ‘oh no we got hacked’ to cover their tracks? i mean… why would a company with 1.4M users not have ANY security? no multi-sig? no cold wallet? no backups? come on.
and then the nzdt stablecoin just… died? because a bank cut them off? that’s not a hack. that’s a business that never had any real infrastructure.
they were running on fumes and hope.
and now everyone’s mad? bro. you knew it was sketchy. you just wanted the free lottery tickets.
Ayanda Ndoni
November 5, 2025 AT 22:39Why are we even talking about this? It’s been 5 years. The money’s gone. The site’s dead. The court’s closed. You wanna cry? Go cry. But don’t turn this into some crypto sermon. Nobody cares.
Also, who even used Cryptopia? I thought it was just a meme exchange. Like, nobody serious used it. I mean, I saw ‘PIRL’ listed and I laughed. I didn’t even try to trade it.
So why are we mourning a site that was basically a crypto carnival?