A cryptocurrency is a digital asset that can be traded between two parties and is not regulated by the government or central bank. Unlike real money (fiat currency), cryptocurrency exists online and all transactions are recorded on a public ledger called the blockchain.
Since the introduction of the first cryptocurrency, Bitcoin, many other digital currencies have been created and are gaining traction as an alternative to fiat currency. Before 2009 crypto was unheard of but since its introduction, the crypto industry is gaining traction and being adopted in the mainstream market. With over 12,000 digital currencies being introduced, people are taking note and are looking to invest more into crypto.
The crypto market has risen to more than $2 trillion and there seems to be no stopping its growth. By the end of 2021, about 106 million people around the world were using cryptocurrencies. As crypto gains popularity and value, there are challenges, with the most persistent being scams and hacking.
Hacking and Crypto Scams
Hacking has been a major thorn in the crypto market, with more than $11 billion being lost in cryptocurrency hacks. People have lost wealth due to hacking attacks and this has led to fears of investing in crypto. Crypto platforms have been boosting their security to stop hackers from accessing digital assets and although they have managed to revamp security, there are still cases of hacking that have led to the loss of billions of dollars. Crypto scams have also increased with many crypto investors falling prey to scammers online and on social media platforms. According to a report by blockchain firm Chainalysis, about $14 billion in cryptocurrency was lost to scammers in 2021.
The rise in value and widespread adoption of crypto has captured the interest of top-level scammers and hackers who will stop at nothing to access your hard-earned digital assets. However, there are a few ways you can increase security and protect your digital investments. Here are a few tips to keep your crypto more secure.
Tips To Keep Your Digital Assets More Secure
Use a cold wallet
A cold wallet is also referred to as a hardware wallet and is not connected to the internet so there is less risk of it being accessed by cybercriminals. A cold wallet is a physical device such as a flash disk or hard disk on which you can store your crypto. The security problem in crypto is not the blockchain but users’ wallets which can be accessed by hackers and if they get hold of your private key, they can access your cryptocurrencies and drain your wallet.
Use a secure internet
Always ensure that you are using a secure internet connection when trading or making crypto transactions. Do not use public WiFi because it can be accessed by hackers. To be more secure you can use a VPN, that changes your IP and location, making your online activity more secure.
Use two-factor authentication (2FA)
2FA is extra protection when allowing access to a website or an application. You have to present two pieces of evidence that you are who you claim to be before you can access an app or a site. This ensures more security beyond username and password.
Have multiple wallets
The saying “do not put all your eggs in one basket” is very applicable when making online investments. It is wise to have multiple wallets to store your crypto. By having separate wallets you will minimize losses in case your account/wallet is accessed by cybercriminals.
Keep your devices secure
To keep hackers from accessing your devices such as phones or PC, always ensure you have an up-to-date anti-virus. If your devices are not secure hackers may access them and compromise your security, you should also keep the firewall enabled and ensure that you do not download suspicious attachments or install apps you do not trust.
Use complex passwords and change them regularly
A strong password makes it harder for cybercriminals to guess and access your accounts or wallet. Do not use the same password on different apps, social media accounts, and your crypto wallet. Changing your password regularly keeps your crypto wallet more secure and difficult for hackers to gain access to.
It is good to be suspicious
One way that people are losing crypto is through phishing. You should always be suspicious and cautious about opening email links or social media links from unknown sources. Phishing scams are on the rise and many people have fallen victim to suspicious websites or emails that seem legitimate only to rob you of all your hard-earned assets these scams come as very convincing messages or offers, leading people to open or access them and as soon as you open a link or an attachment you lose everything. Never visit a website you do not trust or download an app you are not familiar with. You should always be vigilant and do your research well before opening suspicious links or websites.
Do not leave a lot of crypto on an exchange
If you are not trading, it is wise not to leave your cryptocurrency on an exchange platform hot wallet. If you are not trading, store your crypto in more secure wallets such as mobile wallets. Although many exchanges are considered to be secure, it does not cost much to be extra cautious. This is because exchange hacks are real and you never know when your exchange may be targeted.
As the cryptocurrency industry continues to grow and be adopted by more people, the threats are only expected to increase. This is because where there is value, there are always individuals looking to exploit others and the system to steal and cause mayhem. It is your sole responsibility to ensure your investments including crypto are secure and safe. You should employ all available safety precautions to keep your crypto wallet safe. Privacy is key when it comes to money and as a crypto investor, it is wise to keep your information private.