With the cryptocurrency market in the midst of a major bull rally and Bitcoin (BTC) nearing its highs, Concerns about the security of cryptocurrency automatic storage are becoming more relevant than ever.
On November 12, Bitcoin, the world’s largest cryptocurrency by market capitalization, crossed a threshold of $ 16,000 for the first time since the 2017 rally, pushing the price of BTC to an all-time high of $ 20,000. At $ 16,300, Bitcoin was only 12 days above that price in its entire history.
Given that Bitcoin is now at its all-time high and the crypto community is expecting more records in the near future, It is important to note that the security of cryptocurrency holdings is highly dependent on the user.
Here are some simple steps to ensure that your cryptocurrencies like Bitcoin are safe in this bull market.
1. Use a paper wallet or hardware wallet
Since you can essentially be “your own bank” with Bitcoin, the responsibility for storing cryptocurrencies rests primarily with the users. A popular phrase in the cryptocurrency community is “If it’s not your keys, it’s not your Bitcoin”. This means that anyone with the passphrase in a wallet will control the coins inside.
Wallets come in many forms: software, hardware and paper, each with a different security aspect.
As the name suggests, software wallets are software based so that users can access their cryptocurrencies by installing applications on their mobile devices or a computer. As, There are many different types of software wallets such as: B. web, desktop and mobile wallets.
Software wallets are often free and easy to use, but not completely secure, as most of them are connected to the internet in some way, which can leave them vulnerable to hacking attacks or security breaches. Users should keep their applications up to date to reduce the risk of potential breaches.
A paper crypto wallet is essentially a piece of paper that contains a printed crypto address and your private key in the form of QR codes generated through paper wallet websites.. These codes can be scanned to perform crypto transactions. A paper wallet is very resistant to online hacking attacks and is often viewed as an option for cold storage.
A hardware wallet is another sophisticated method of storing cryptocurrency that isolates the user’s private keys from the internet while keeping them offline on a USB connected device.. A hardware wallet, also known as cold storage or cold wallet, is often associated with a higher level of security because the private keys remain completely offline, making them immune to any type of remote hacking. Trezor and Ledger are considered the most popular hardware wallet suppliers.
2. Verify that your two-factor verification (2FA) is enabled
Don’t ignore an additional level of security by forgetting to enable two-factor authentication (2FA) in the security settings of your wallet account. 2FA sends an additional password request to your phone or email every time you log into your wallet. By enabling 2FA, a user prevents a hacker from instantly accessing a Crypto Wallet account as the hacker also needs physical access to the user’s phone or email address.
Google Authenticator is one of the most popular 2FA apps that allows users to verify in two steps on a phone.
3. Never share your private keys
Never give your private key or a first sentence to anyone. That way, you’d essentially be giving away the keys to the lock. Remember, reputable cryptocurrency companies will never ask you for your keys even if they are trying to help you solve problems.
4. Make sure the recipient’s wallet is correct
Always check a recipient’s address before proceeding with a transaction. A simple mistake of one letter could redirect your transaction to another wallet. Unlike some traditional financial services, most crypto transactions are irreversible. Some malicious programs can also change the correct target of your cryptocurrencies so that double checking of transaction details is never redundant.
5. Don’t fall for gift fraud
Never fall for offers like “Send us bitcoin and get double your bitcoin”. This type of attack is widespread on Twitter, and attackers often pose as celebrities, politicians, or crypto personalities who promise to double the user’s crypto fortune.
Since this type of attack is often associated with newbies to cryptocurrencies, it could get even more attention as crypto adoption increases. In July 2020, online hackers managed to collect at least 12 BTC in a high profile hack from Twitter accounts such as Elon Musk and 2020 US presidential candidate Joe Biden.
6. Use smaller transactions and different exchanges
Don’t send a bunch of cryptocurrencies in a single transaction when you need to buy or sell cryptocurrencies on a cryptocurrency exchange. If you have a large amount of money to trade in crypto, it is best to split it up into multiple transactions to make sure an exchange works properly.
While all of these layers of security and double-checking may seem like a chore, they are key to making sure your funds stay safe.