Every day it seems a new story emerges about an exchange going bankrupt. Has been a recurring pattern since the Mt. Gox collapse. Why, with so many examples of failures, do people continue to keep their money on these? You don't own crypto if you have "coins" on an exchange, you have an IOU from a business that may or may not even be solvent.
You are right but if you are a short term trader you do not really have too much of a choice, since it would not make a lot of sense for those people to withdraw their coins at the end of their session only to deposit them at the beginning of the session the very next day, so those people need to take the risk of storing their coins at an exchange, however those which are not really traders and are using the exchange as their personal wallet are without a doubt making a huge mistake, and they could end up paying a huge price just because they were too lazy to create their own wallet.