Security is always paramount when it comes to ensuring your finances are protected, including when holding cryptocurrency.
While there are many additional security features that can be obtained when holding virtual currency compared to fiat options, there is still a need to ensure that these investments have been secured properly.
Of course, you only have to look at the latest Bitcoin price AUD if you hold the coin to realize the importance of protecting your investment in the best way possible. It does not have to only relate to Bitcoin, either, as many other cryptocurrencies can hold plenty of investable value, especially as they gain popularity and traction among new investors.
Thankfully, there are many ways in which you can secure these investments, with many of them simple steps to take and follow.
1. Use Hardware Wallets
Cryptocurrency holders should use hardware wallets if they want to ensure their virtual currency is as secure as possible. A hardware wallet is a physical piece of equipment, such as a device, that can hold users’ cryptographic keys offline. This makes them less susceptible to online hacks. They are not used to hold the coins, though, as they are used to keep the keys required to access the blockchain separate and safe.
2. Set Up Two-Factor Authentication (2FA)
Most will be aware of two-factor authentication (2FA), as it is likely to have been encountered before. It can come in the form of a password and then a code, while some can even feature biometric technology to enhance the level of security being offered. This type of security measure provides an additional layer of protection to accounts and can be applied to crypto investments.
3. Choose Reputable Wallets
A crypto-holder should be looking to use a reputable wallet to store their cryptocurrency, as this can help to ensure the best protection is available. A reputable wallet will have a trusted reputation due to its features, including the level of security that can be obtained. The top wallets will protect the crypto being held with protocols like 2FA and encryption measures, as well as use the blockchain technology that crypto uses.
4. Backup Your Wallet
It is important to continue to backup the chosen wallet, as this can help keep your private keys safe and protect them. Regular backups of your wallet can allow individuals to protect themselves from losing access should they forget their password. At the same time, it can keep it secure with the latest security features that may have been made available.
5. Keep Software Updated
In addition to backing up your crypto wallet, it is important to continue to do the required software updates to ensure the best security is being experienced. The software can easily become outdated due to witnessed technological updates, leading to potential vulnerabilities and possible areas of exploitation hackers can look to try and capitalize on. By doing the updates regularly, the holder can reduce and eliminate the potential risks of a breach.
6. Beware of Phishing Scams
In today’s internet age, there are more and more scams that people must be careful to look out for. One of these is phishing scams. They can come in the form of emails, messages, or websites that look genuine. They can often be easy to spot as they will often ask for information that would not normally be asked to be shared. In cryptocurrency terms, this could be for your private keys or personal login details. Make sure to keep these aspects of information private, and never share them with anyone you do not trust.
7. Diversify Storage Locations
To enhance the level of security that is possible, it can be best to have aspects of the crypto held in different locations. For instance, you could look to use a combination of different wallets to split the investments being held, thus eliminating the risk of losing your entire portfolio if you are compromised. While it can be more difficult to keep on top of, it can be much safer than storing everything in one place.
The Bottom Line
You can store your cryptocurrency investments and keep them secure in numerous ways. It is important to ensure you take the necessary precautions, as a security breach can be very costly in more than one way when virtual currency is involved!
“Disclaimer: This information is of a general nature only and should not be regarded as specific to any particular situation. This should not be taken as financial advice to buy, trade, or sell cryptocurrency or use any specific exchange. This is not intended for use as investment, financial or legal advice as each individual’s need will vary.
Binance Australia is not affiliated, associated, endorsed by, or in any way officially connected with any individual or organisations mentioned in the article. Binance Australia is not liable for any loss caused, whether due to negligence or otherwise arising from the use of, or reliance on, the information provided directly or indirectly by use of this newsletter and expressly disclaims any and all liability for any loss or damage you may suffer.”
