Yes you must hold the tokens in your private wallet. Either MEW or imtoken or any compatible ERC20 wallet. If you leave your tokens at exchange you will not get anything. And ontop of that you must hold a specific amount on your wallet monthly to be eligible.

I will publish details about the second phase distribution when i get at least one more exchange  to this ones.

Note the reserve 400k token will not be sold but a certain amount will be deducted monthly and shared to token holders with specific amounts of token in their wallet  for free