The recent cryptocurrency boom has sent investors scrambling as they try to keep ahead of the latest crypto bull market.
From Bitcoin (BTC) to Litecoin (LTC) and Ethereum (ETH) to XRP, it’s clear to see that the crypto boom is well and truly here. While all of this is good news for investors, still waters do indeed run deep.
Whether you’re a seasoned investor or a punter dipping his/her toes into the water, it’s always better to err on the side of caution. There are plenty of con artists, hackers, and thieves all looking to take advantage of an unsuspecting target.
Given the decentralized nature of the crypto market, victims often end up with little-to-no legal recourse.
In this article, we’ll take a look at how you can keep your cryptocurrencies safe, secure, and out of the hands of thieves.
Let’s begin with:
1. Investing in a cold wallet
Even the newest crypto investor has heard of crypto wallets and their uses. Most investors tend to stick with hot wallets for the convenience that they offer.
Hot wallets are basically online only services that store your cryptocurrencies online. These services allow you to gain easy access to your cryptos from anywhere around the world – thus making them extremely convenient.
However, these service providers are not subject to the same regulations as banks. Which means that their security measures may not be as stringent. Because of this, online crypto wallets are a favourite target of hackers and scammers.
Instead of storing your cryptocurrencies online, invest in a cold wallet. Cold wallets are devices that store cryptos offline which makes them impossible to hack.
As these devices can be physically secured i.e. stored in a safe or deposit box, the risk of losing access to your cryptocurrencies is kept to a minimal.
You can find the top 10 best Ethereum wallets in 2021 here.
2: Only performing your transactions in a safe environment
While the uptake of cryptocurrencies is on the rise, this does not mean that we should let down our guard.
Free Wi-Fi in cafes, airports, bars, and hotels are a favorite of smart device users looking to conserve their data. It should also be noted that free Wi-Fi is also a popular hunting ground for hackers looking to steal your data.
From man-in-the-middle attacks to fake Wi-Fi connections, it is remarkably easy to fall prey to these scoundrels. When you’re out and about, try not to make use of free Wi-Fi wherever you are.
If you absolutely must use Wi-Fi, make sure that you don’t perform any transactions while connected to the network. The last thing you’ll want is for a hacker to gain access to your crypto wallet and funnel away all of your hard-earned cryptos.
3: Working with trusted partners
The decentralized nature of the crypto market has given investors a remarkable degree of freedom. From seamless cash transfers to anonymous transactions over the internet, it’s easy to see why cryptocurrencies have become so popular.
One drawback of this decentralized environment is the immense lack of oversight. The lack of government intervention means that the risk of moral hazard will be continually present.
For example, the mysterious and absurd circumstances surrounding the death of Quadriga CEO; Gerald Cotten has led some to question the legitimacy of his death.
In the aftermath of Cotten’s death, Quadriga reported that it was not able to account for $190 million worth of cryptocurrencies. The reason: the company was locked out of the dead CEO’s cold wallet.
This underlines the importance of working with trusted companies that have a proven track record. Events such as Quadriga are not uncommon and potentially billions of dollars worth of cryptocurrencies have been left unaccounted for.
This is why it’s essential for you to safeguard your crypto assets whatever you do. Whether it’s regularly changing your passwords or using multiple wallets, you can never be too careful.