In value, Bitcoin and other crypto-assets have exploded, making them an ever-more attractive target for hackers. Indeed, last week saw one of the largest heists in history: $534 million stolen from a Japanese cryptocurrency exchange CoinCheck.
When you buy bitcoin or another digital currency, one of your priorities should be protecting your investment. Cryptocurrencies aren’t regulated or insured by any government and most crypto scammers know this. So if something goes wrong with the exchange you use, there is no official body to help you recover losses.
This guide aims to help you keep your money safe by explaining how to protect your bitcoins and other cryptocurrencies — which is very important given how much money you’ve likely made.
First, If you’ve recently purchased bitcoin or any other cryptocurrency, transfer the bulk of your funds to an offline wallet; moving it to an offline wallet will prevent hackers from stealing your money. An offline wallet, or cold storage as it’s sometimes called, is a bitcoin wallet that isn’t connected to the internet. It means that this type of wallet can’t be hacked by cybercriminals remotely.
In addition to being safe from hackers’ prying eyes, this type of wallet is also a lot safer than an online wallet. An online wallet is stored on a server controlled by someone else, making it vulnerable to hackers who might break into the server and steal all of the information stored there.
A bitcoin or cryptocurrency offline wallet also has some other benefits over traditional paper wallets. For example, many wallets require little more than entering a private key to access your bitcoin. It lets you spend your cryptocurrency more efficiently and with greater security.
Second, you should also have a small amount of money in an online wallet that you can use for everyday transactions. This way, if some disaster strikes and your offline bitcoin storage is compromised, you won’t lose all of your coins.
There are many different services available here. They are easy to use, support multiple currencies, and allow you to store your bitcoins safely offline.
Make sure to use a strong password for that wallet. The stronger the password, the better! Password strength is measured by what it would take for a computer to crack it. Passwords like “password” and “1234” are very weak.
Now that your wallet is safe, it’s time to look after your email. It would help to create a new email address for all crypto-related dealings. Don’t forget that your password should be different from the one you chose for your email provider.
When setting up a new email address, make sure to use two-factor authentication (2FA) to provide an extra layer of protection above the strong password you just established.
Possible risks associated with new digital currencies are nasty exchanges, phishing, and fake ICOs. To protect yourself from counterfeit ICOs, always confirm that the project is legitimate through a credible source before sending them your money.
Phishing scams are easy to spot once you know what you’re looking for: scammers will often set up fake websites that resemble an authentic exchange platform with similar logos and colors. They will then encourage you to log in to the site and enter your personal information.
The Secure Login Verification 2FA is a method of adding an extra layer of security by receiving a one-time password from an app on your smartphone; once enabled, 2FA keeps your wallet safe from hackers trying to access it from another location.
Exchanges for Digital Currency
An exchange is a website where users can buy, sell or trade cryptocurrency for other digital currency or traditional currency like USD. If you are using an exchange to store your coins, they must have a good reputation, transparent company information, strong security measures, and reasonable fees.
In addition to storing your coin, exchanges can also interact with a bitcoin or cryptocurrency wallet. An exchange will also link directly to your bank account and debit card, allowing you to sell coins for cash in an efficient manner.
Good exchanges will also offer many other valuable features to make your life easier. For example, you can use online marketplaces on crypto exchanges to sell digital currency for a reasonable price.
Some bad players in the crypto exchange industry might try and scam you out of some money. Make sure that you always do your research before choosing an exchange platform. Be especially wary of new platforms with a little track record but promising high returns or special deals for early investors/customers.
For example, an increasing number of bitcoin scams involve fake exchanges that claim to let users convert regular currencies into cryptocurrencies instantly and vice-versa. These counterfeit services will often steal your personal information and disappear with your cash without delivering any cryptocurrency in return.
You can take several steps to make sure that your cryptocurrencies are safe. It includes using an offline wallet, setting up 2FA, and creating a strong password for your email account. If something goes wrong, you should get help by reaching out to the customer support of the website or service you are using.
Never store large amounts of money on an exchange, and always keep your coins in a secure wallet or cold storage. By following some of these simple security tips, you can help to protect your digital currency investments.