How to Protect Your Cryptocurrency Wallet

Keeping your privacy and digital footprint secure is of utmost importance. In this day and age, you must do whatever possible to keep your information safe. That includes protecting your cryptocurrency.

People often buy cryptocurrency from exchanges and store them in digital wallets. When you purchase cryptocurrency, it automatically goes to your wallet. The fiat currency turns to crypto in your digital wallet. Whether you buy crypto using a credit card or bank transfer, it does not matter. However, once you have the crypto, you must keep it safe and secure.

There are some tips that you can follow to keep your crypto safe. 

Use a Trusted Wallet

It is vital to use a reputable and highly rated wallet. We recommend wallets that are secure and have many user reviews and those that provide extra security like two-factor authentication (2FA). Wallets with two-factor authentication require users to input another code or password before they can access their accounts. It’s not hard to do, but it can be very effective at preventing hackers from stealing your cryptocurrency. 

The best wallets will also have additional security protections in place, such as PIN codes and multi-signature support, which require the signatures of multiple users before a transaction can be completed.

Set a Strong Password

As a cryptocurrency investor, it’s your responsibility to keep your wallet secure. Use a password that includes letters, numbers, and special characters (you can use a password generator or manager like Lastpass if you have trouble remembering your passwords). Make sure it’s different from the one you use for other accounts. Don’t use easy-to-guess passwords like your birthday. If you can’t remember your password, write it down in a safe place that only you know about.

2FA

The second form of authentication is often a code sent to your phone, which you then need to enter in addition to your password. So, even if someone gets access to your password through a data breach, they still need access to your phone to use the account.

While 2FA is great for keeping your accounts safe overall (we highly recommend it), it can be annoying having codes sent via text message. If you’re like me and think that receiving a code via SMS is too much of a hassle or security risk, there are other ways around this. 

Don’t Lose Your Backup Phrase.

To avoid this situation, here are a few simple rules you should follow:

  • Don’t lose your backup phrase. That’s the most important rule, and it might seem like common sense, but in practice, it can be difficult to keep track of something that is both so private and valuable.
  • Do not store your backup phrase in any cloud service or online. The Internet can be an extremely insecure place, and hackers have access to resources you probably wouldn’t believe possible. As tempting as it might be to have your backup phrase available at the touch of a button, it is simply not worth the risk if someone were ever to gain access to that information and could get into your wallet.
  • Keep your backup phrase safe but accessible. It may sound contradictory, but there’s a meaningful difference between keeping something on a piece of paper in a dark drawer and keeping it somewhere you will not remember putting it. However, make sure that whatever method you use does not jeopardize rule #2 above!
  • Write down your backup phrase by hand instead of printing it out on a computer printer. A printed copy would require connecting one more “link in the chain” (your computer) for an attacker to hack into before getting access to your cryptocurrency wallet—just more potential problems waiting to happen! And if hackers did manage somehow break through all those layers of security, then why stop using paper?

Buy Insurance

You can’t use the insurance you may have on your home to protect your cryptocurrency in case of a loss or theft. However, some companies offer insurance for digital currency wallets. The type of protection by these companies depends on which ones you choose. 

For example, some policies only cover damage or loss incurred through accidental exposure of private keys (the password for your wallet). Others will protect against any loss or damage, including in cases where the user is hacked or tricked into sending their digital currency to criminals.

It is important to note that insurance for cryptocurrency wallets is not necessary if you’re holding smaller amounts of money and only occasionally using digital currencies. However, if you have large amounts of money, it might be worth looking into purchasing insurance to protect yourself from risk. Many hardware wallet providers include insurance as part of their terms and conditions when they sell their products.

Use a Secure Internet Connection

To protect your cryptocurrency wallet, you should use secure internet connections that you trust. Never use public WiFi. 

Do not use an untrusted network. If a network seems suspicious or unfamiliar, do not connect your device to it.

Avoid Using Public Devices or WiFi to Access Your Wallet

Before you begin investing in cryptocurrency, it’s crucial to familiarize yourself with best practices for securing your investment. As with any type of financial investment, several hazards could befall your cryptocurrency wallet. 

Always assume that strangers or public computers/devices are infected with malware and avoid using them to access your wallet. Instead, access your wallet only from devices you own and control, such as a smartphone, tablet, or laptop running virus protection software. That will help prevent hackers from stealing your funds.

Finally: do not disclose the private key to anyone who is not affiliated with an exchange or a trustworthy party; this will help keep hackers at bay and also protect against insider theft.

Ensuring all these things will help keep your crypto wallet safe.

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