Every major exchange and lender collapse from 2014 to 2023. The pattern is always the same.

After enough cycles you lose track of which exchange or lender blew up when, so I went back and put the major custody failures from 2014 to 2023 into one timeline with the actual figures.

Running through them:

• Mt. Gox (2014): around 850,000 BTC gone. It wasn't a dramatic hack, the coins drained out over years behind balances that were simply faked. Anyone with funds on it saw no repayment until 2024.
• QuadrigaCX (2018): the CEO died and the company claimed he was the only one who could access the cold wallets, so ~CAD 169M was supposedly stuck. Then the auditors looked, and the wallets had been empty for eight months before he died. The Ontario regulator called it a Ponzi.
• 2022, the whole cascade: Three Arrows Capital (a hedge fund) over-leveraged itself into the ground and defaulted on the lenders that were funding it with customer deposits. Celsius, Voyager, BlockFi, and Genesis went down behind it inside about eight months. The "earn yield on your crypto" products had been lending those deposits into that leverage the entire time.
• FTX (2022): roughly $8B hole, customer funds routed to Alameda, SBF got 25 years. One detail worth knowing if you had money there: the estate is repaying creditors over 100%, but in dollars valued at the November 2022 petition date, when BTC was around $16k. It later ran past $90k, so the recovery measured in actual coins is far below what people lost.

The annoying part is how little it changes from one to the next. The deposits were never just sitting there, you had no way to verify the custody, and when it broke you were an unsecured creditor in a bankruptcy instead of someone who owned coins.

We have to talk about the other side too, because "just self-custody" isn't free advice. You need exchanges to actually buy and sell. Lose your seed phrase and there's no support line and no court to recover it. Some people are genuinely better off with a regulated, insured custodian.

Full story:
https://www.learnbitcoin.com/rabbit-hole/mt-gox-ftx-graveyard

Corrections welcome.