Cryptocurrencies offer (or at least they promise) security. It is one of the huge attractions of digital currencies, as no one can track your transactions, allowing you to stay anonymous. While the security that comes with cryptos is indeed remarkable, there have been instances where investors have lost millions of their crypto holdings. Yes, millions. And what is interesting is that they’ve lost the money not due to the blockchain-run system, but due to their own fault.
Investors can often get complacent with their data and incur heavy losses. Hacked exchanges and phishing scams are the key reasons for that, and since cryptos are decentralised, there’s no way of recovering losses either. That is why it is important to secure your digital wallets in every way you can. We hope these tips can help you.
1. Focus on securing your wallet
A common myth among new-age as well as seasoned crypto investors is that the biggest threat to their crypto holding is the blockchain network. However, we’re here to tell you that it is not true. Instead, it is your wallet or crypto exchange that has the potential to expose your crypto holdings to hackers.
Information can be tracked and stored at the provider level, including your private key, which can then be accessed by hackers. Hence, choose your digital wallets wisely. Only use those wallets that have been developed by reputed companies.
2. Backup your wallets
Opening a wallet with a dependable name in the industry doesn’t mean your Bitcoin, Ethereum, and Dogecoin holdings are safe. They can still be hacked by experienced professionals. You can, however, prevent that by storing your wallet’s private keys offline. Also, always have backups of these private keys, which are also stored offline.
To be absolutely safe, you can also store a backup of your keys outside of your home as well. It sounds too much but it will come in handy if your house is unfortunately caught in a disaster.
3. Keep your holdings private
Even if you’re making a killing in cryptos, never brag about it. You never know what goes on inside a person’s head. There is some possibility that having heard about the value of your crypto holdings, the person could turn hostile and ask you to hand over your private keys. It seems unlikely, but you never know for sure. While you can use technologies like multi-signature wallets, it won’t matter if the attacker threatens you or your family.
So never brag and flaunt your cryptocurrency holdings to anyone. Nobody needs to know exactly how many Bitcoins, Ethereum, or Cardano you hold. Keep it to yourself, and there’s no way you will get targeted for that.
4. Beware of phishing scams
Phishing scams are getting popular. There are many ways to compromise the security of your device, including through faux Google, YouTube ads, and through fake applications wrongly uploaded to the App Store and the Google Play Store. Once you send your private key to a phishing scam website, your cryptocurrency holdings will be wiped in seconds.
That is why you should never visit websites that lack security. Double and triple-check the applications that you download and be 100% sure that they are official and not fake.