ZoneBitcoin EditorialInvest in cryptocurrencies, that’s good, but protecting them is even better. There are many risks of losing your cryptocurrencies. Keeping them safe is therefore essential. In addition, with the fall of FTX, which was one of the leading exchange platforms in the sector, confidence is undermined.
Indeed, the market is still poorly regulated and it is therefore important to have good practices in terms of security. Between scams, crooks and impostures, it is more than ever time to learn the right actions.
So, without further ado, here are the 7 ways to secure your cryptocurrencies.
1/ Choose secure platforms
We can never say it enough. Even regulated platforms that seem safe are not. You have clearly seen with FTX and Celsius that even the most reputable platforms are not safe from going bankrupt. So, today, the ideal would be to choose a platform that displays a proof of reserve. This is an audit that will certainly become a prerequisite in the coming months/weeks.
Require absolute transparency from your platform on the origin of funds. For example, Kraken has always been transparent about the funds it has available. Choose a platform as “impeccable” as Kraken.
Other platforms have shown themselves to be clean and secure like Binance, Kucoin ou Okex. However, you have to follow the news these days to see their real proof of reserve (not just the announcements).
However, remember that buying your cryptocurrencies on exchanges is only the first step. If you leave your cryptocurrencies on an exchange platform, you do not have the security and management of your funds. You must move them into a secure wallet and ideally have a open source physical wallet.
Otherwise, you can already opt for a non-custodial wallet.
2/ Choose a non-custodial wallet
A non-custodial wallet is ideal if you want to protect your cryptocurrencies. You will then have total control of your private keys and you become, in a way, your own bank.
It is also with a non-custodial wallet that you will make full use of decentralization. No KYC identity checks, you do not need to disclose your private information. In fact, the risk of a data breach is much lower than on other types of wallets.
Even better than protecting your cryptocurrencies, you will also have the possibility of participating in different dAPPs of decentralized finance.
There are many very reputable non-custodial wallets like Trust wallet For example. You will need to write down your words in order securely (without disclosing it) to create an account. It's also a great app for interacting with decentralized finance directly from the interface.
3/ Diversify your funds across several platforms
This is the well-known rule in personal finance that you must also follow for your cryptocurrencies. Diversify your strategies but also the portfolios you have. For example, if you have a portfolio Metamask, feel free to create a second one. This will allow you, for example, to use one wallet for one type of activity and the other as a security deposit box.
It's the same for centralized platforms, have several choices. Thus, in the accidental case of yet another platform bankruptcy, you will always have another platform with your funds “safe”.
4/ Store your cryptos in a cold wallet if you can
For those who practice hodl, storing their cryptocurrencies in a cold wallet turns out to be an ideal option. So-called cold wallets are the opposite of hot wallets. We call these “cold” wallets in the sense that they are not perpetually connected to the internet. Among them, we find the hardware wallets. We can also cite the paper wallet which are also cold wallets.
It is accepted for several reasons that hardware wallets are superior in terms of security. They are not accessible via the Internet and this drastically reduces cybersecurity attacks.
For example, if you want to keep a certain cryptocurrency for the long term, it is recommended to store them in a cold wallet.
There are several cold wallets on the market. All are more or less equivalent and very often, it will be your personal preference which will influence your choice. We can recommend Jade, Bitbox, safepal or Ledger which are the best known and most used cold wallets.
Lire: The 6 best open source wallets to store your cryptocurrencys to learn more about cold wallets.
5/ Use complex passwords and activate 2-factor authentication
The first thing is to use different and, above all, difficult passwords. This therefore includes alpha-numeric characters and symbols to make things more complex. It is also good to modify them regularly.
Better yet, you need to enable 2-factor authentication. This method completes the security of your passwords. Also, don't forget to write down the backup code if you change your phone or lose it.
It should also be secure your seed phrase which is definitely the most central element you need to protect. To do this, you can read our dedicated article: Here are 12 tips to secure your seed sentence and sleep in peace
6/ Check the security of your internet
This must be the basis of your internet browsing, even if you do not use cryptocurrencies elsewhere. Do not connect to your crypto platforms if you use a public WIFI network for example. If you're using an airport's WiFi network, for example, this won't be the time to connect to your wallets. Even if you think nothing will happen, you are not safe from catching a virus...
Do not browse shady sites and always check that you have updated anti-malware software installed on your computer.
For maximum security, do not hesitate to use a VPN. This is certainly not mandatory, but it will allow you to encrypt your communications from intruders while hiding your crypto activities from your internet service provider.
There are many suppliers and maybe you know NordVPN. There are others and this may be useful for other activities on the internet.
-Read the article : Is it useful to have a VPN if you own cryptocurrencies?
7/ Beware of scams of all kinds
The most common scams in crypto are certainly Phishing attacks. This involves completely copying a site so that you cannot tell the difference from the original. With confidence, you will register and therefore enter your information (password etc.). There, the criminal behind this attack will be able to steal your account on the original site.
Always check the address of the site you are going to. Sometimes it just appends a letter to the original url address. Pay attention.
Scammers are very clever in always finding new methods to scam. For example, there was recently Pig Butchering, which consists of using attractive people on networks to attract victims into a bogus investment. (See “Watch out for the new “Pig Butchering” scam. There are also videos circulating with enticing titles like “How to earn 1000 euros on Youtube“. Those are scams well developed that will siphon off your accounts in less than two minutes…
In short, techniques are always evolving to protect your cryptocurrencies. Likewise, sometimes there are projects that are not necessarily scams but are simply doomed to failure. There's a lot more to them than you think...They only have appearances and everything else is meaningless. This is why it is important to know how to make a fundamental analysis and to make DYER for each project. Even if your favorite influencer has told you about a project, always be wary.
Final Word on How to Protect Your Cryptocurrency
So yes, some tasks can seem laborious. However, nothing is more psychologically comfortable than knowing that your cryptocurrencies are well protected.
Of course, zero risk does not exist. You can still be targeted by cybercriminals or stumble upon a rogue protocol. However, by diversifying your funds, you will then have a portfolio that will not be affected.
If you have any questions or comments, please let us know.
Other related articles:
—> The 5 types of cryptocurrency wallets: what you need to know
-> How to protect yourself against NFT hacks?
-> How to revoke contracts on your wallet?
—> Know the different types of Bitcoin addresses and know how to recognize them
->Why has Bitcoin never been hacked?
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Note: No financial advice is given in this or any other article on zonebitcoin. This is information of which you are the sole judge and master. Be responsible with your investments and only invest as much as you are willing to lose.
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