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Many crypto exchanges impose quite low limits on withdrawing balances from their sites. For example Binance has an equivalent limits of 100 BTC for a daily withdrawal.
The question is, why do they need to impose a limit at all? Are the customers coins not in segregated custody, and when sold in a transaction on the exchange, the funds should be there irrespective of the size of the transaction. In short, why would an exchange need to limit withdrawals at all?
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Limits could be in place for a number of reasons, such as:
Regulations imposed by the government of the country the exchange is operating within (eg unverified customers can only withdraw a certain amount)
The majority of the exchange's coin reserves are held in an offline, cold storage wallet. So a very large withdrawal may require more coins than the exchange has available in an automated hot wallet (this is a security consideration)
Every exchange will have its own considerations in this regard, but these examples should give you some basic understanding of why limits would exist.
Sounds wrong. Governments don't regulate the exchanges as far as I know. If they can do $200 000 for a level 3 individual then then they can do the same for a level 1. If you do normal trades with banks there is no restriction. That stuff about it being in cold storage is wrong. – jack black – 2018-02-08T11:31:01.327
@jackblack please remain friendly and polite, no need for that language here – MeshCollider – 2018-02-11T10:09:58.307