Cryptocurrencies are all the rage right now. Whether you’re a fan of Bitcoin, Ethereum, Litecoin, or any of the other popular digital currencies, there’s no doubt that they offer a lot of potential for investment and innovation. However, with great opportunity comes great risk.
In 2021 alone, it is estimated that cryptocurrency worth $14 billion was lost to crypto scammers and hackers. Well, it’s only going to get worse if more people don’t start taking cryptocurrency security seriously.
In fact, the Federal Trade Commission (FTC) reported that crypto scams had surpassed traditional investment fraud as the most prevalent form of online fraud.
This article will share some cryptocurrency security tips to help you protect your digital investment.
7+ Cryptocurrency Security Tips for Safeguarding Your Investment
1. Keep Hardware Wallets
While online wallets are convenient, they are prone to hacking. A better option is to store your cryptocurrency in a hardware wallet.
Hardware wallets are physical devices that store your private keys offline. They are immune to hacking and malware attacks, making them the safest way to store your cryptocurrencies.
However, it’s important to keep in mind that even hardware wallets can be lost or stolen, so it’s important to have a backup plan in place.
You should also never store more than you can afford to lose on a single device.
2. Use Two-Factor Authentication (Two-FA)
Two-factor authentication is an extra layer of security that requires you not only to know your login credentials but also to have access to a separate device, such as your phone, which will generate a unique code for you.
This prevents anyone from logging into your account even if they have your username and password.
Ensure you set up two-factor authentication for any accounts related to your digital investment, including exchanges and wallets.
3. Use a Password Manager
A password manager is a software application that helps you generate strong passwords, store them securely, and automatically enter them when you need to log in to an account.
This is important because it’s nearly impossible to remember all of your different passwords, especially if they’re long and complex.
Using a password manager also reduces the risk of falling victim to phishing attacks. This is when scammers pose as legitimate businesses to trick you into giving them your login credentials.
4. Watch out for Phishing Emails
A Data Breach Investigation conducted by Verizon in 2019 revealed that phishing is involved in approximately a third of all cybersecurity breaches. Kaspersky also confirmed that phishing was the leading cause of investment scams in 2021.
Phishing emails are especially dangerous because they often look very legitimate. They may include the logo of a real company or organization and appear to come from someone you know. However, phishing emails should be easy to spot if you know what to look for.
Some common telltale signs that an email is a phishing attack include:
- Urgent requests for personal information
- Requests for login credentials or passwords
- Grammatical errors or poor spelling
- Emails that do not address you by name
- Links that lead to fake websites designed to steal your information
Cryptocurrency Security Tips from a Pro #1: Large organizations send emails from accounts connected to their domain eg(email@example.com). Scammers will try to make it appear like it’s connected to a domain; while it’s not.
Look at these images I attached below.
I recently got this email. Looks legit, right?
I went ahead to look it up, and guess what? It’s a real organization!
But, when I expanded to check the sender…
5. Maintain Privacy
No one needs to know how much cryptocurrency you hold. Be sure to keep your transactions and balances private by using a wallet that doesn’t require registration.
While there’s always an urge to brag about that new car you just bought or the big promotion you received at work, resist the urge to do the same with your crypto holdings. There’s no need to let everyone know how much money you have in your digital wallet. Not only is it unnecessary, but it could also make you a target for criminals.
6. Avoid Public Wi-Fi
Public Wi-Fi is a hacker’s dream. By connecting to an unsecured network, you’re opening yourself up to all sorts of attacks, including man-in-the-middle and phishing schemes. If you must use public Wi-Fi, be sure to use a VPN (Virtual Private Network) to encrypt your traffic.
7. A Crypto Wallet is Safer than the Exchange Platform
When storing your cryptocurrency, you have two options: an exchange platform or a digital wallet. Exchange platforms are convenient because they offer a one-stop shop for buying and selling crypto. However, they’re also far less secure than digital wallets.
That’s because exchanges are attractive targets for hackers due to the large amount of money that flows through them daily. If you decide to use an exchange platform, be sure to only store the amount of currency you need for trading purposes and withdraw the rest to your digital wallet.
You also don’t want your crypto frozen by the admin of an exchange platform. So, make sure to choose a reputable platform with a good reputation for security.
Cryptocurrency Security Tips from a Pro #2: Audit Your Investments, Accounts, and Transactions Regularly
One of the best ways to protect your cryptocurrency investment is to audit your holdings regularly. This means checking your account balances and transaction histories regularly. Doing so will help you spot any unauthorized activity or changes in your portfolio.
Report any suspicious activity or unauthorized transactions to your exchange or wallet provider immediately.
Cryptocurrencies are becoming more and more popular every day, but with their growing popularity comes an increased risk of cybercrime. As a digital investor, it’s important to know how to protect your cryptocurrency from theft and fraud. While we can’t predict the future of this volatile market, these cryptocurrency security tips should help you keep your digital investment safe in 2022 and beyond.