Crypto Intermediate

How to keep your cryptocurrency safe

As crypto trading becomes even more popular than ever, the crypto world is confronted by one huge problem: safety. The number of hacks and scams in the crypto world last year was truly alarming. But there are a few simple measures you can take to secure yourself. Here are 10 key ways to keep your cryptocurrency safe as houses.

1. Use Two-Factor Authentication on your exchange

When you first make a Bitcoin purchase, it is often via a transfer account. Hackers who gain access to this account can move your crypto to a holder address—essentially stealing your money. Making sure you purchase your crypto with Two-Factor Authentication (2FA) is one of the simplest ways to protect yourself against such attacks.

Each time you want to withdraw crypto with 2FA, you will have to verify the transaction by entering the code sent to your phone. It could be a bother if your phone’s battery is down or if you’re outside the network coverage area. But the fact that it protects your funds from hackers makes it worth the effort.

Download an authenticator app

Your account with the exchange can also be made more secure if you use a tool like Google Authenticator for 2FA. Such apps ensure that the code is not sent via SMS or email, they make it harder for a hacker to access it even if they take over your phone.
The attacker will need to physically access your phone if you use these apps. That makes it a far more effective layer of protection.

2. Withdraw your crypto

Crypto worth millions of dollars are often stored on exchanges. As a result, exchanges tend to attract hackers and frauds. So simply withdrawing your coins is one way to keep it safe.

To do this, you must purchase a wallet, set it up on your CPU, and then ask the exchange to deliver your cryptocurrency to the wallet address. Only after this is done will you be able to withdraw it.

Once you’ve accomplished this, no malicious actor will be able to steal your crypto by hacking the exchange or your exchange account. Instead, they would have to penetrate your PC, which can again be secured in various ways.

3. Back up your seed words properly

You could be tempted to skip this step if you’re in a rush or are new to cryptography. But make sure you don’t. And don’t just click a picture of your seed phrase as a backup. Because there are many reasons to exercise caution while storing seed words.
If you don’t have a backup of your seed words and your device happens to die for some reason, you will lose all your crypto. And PCs contain moving parts that deteriorate over time, so your device is bound to crash eventually.

Fortunately, there is a simple way to address the problem. Simply jot down your seed words on a piece of paper. Make sure you keep the paper in a safe spot away from the elements.

4. Use a strong password to protect your crypto.

If you use a strong password and keep it safe, hackers won’t be able to access your files and seed words—assuming your device has not been compromised. However, before the vault is completely encrypted, an attacker may be able to use Hashcat’s password recovery tool or some other hash-cracking program to reach your seed words. So much of your safety will depend on how complicated your password is.

If you make it easy to crack, they might be able to get away with your crypto in no time. And it may not even cost them a lot to implement the hack. The longer a password is, the harder it is to crack it. It also helps if the password contains capital and lowercase letters, digits, and special characters.

Use a different password for your wallet.

Tempting as it might be, don’t use the same password in multiple places. There are various benefits to using a different password for your wallet than the one you use for websites.

First, if a hacker gains access to a well-known website you frequent, they may be able to obtain your password and use it to run hash-cracking software on your computer. That’s why you should make your wallet password unique.

That said, it is still possible for an attacker to use key-logging software to hack your account or to extract any unencrypted data from your PC, even if you choose a strong, unique password. So while it is not a sure-shot solution, it’s one of the various steps that can help.

5. Use a hardware wallet if possible

Using crypto wallet hardware, a USB device to store your key phrase is one of the best ways to protect your crypto. Your seed phrase cannot be transferred outside of the gadget unencrypted, thanks to the design. It will be very hard to infect a tool wallet with malware since it lacks an internet connection. You could conduct transactions without exposing your key to a device to the internet by having your crypto hardware wallet generate a passcode and deliver it to your internet-connected device.
Even if your wallet is physically taken, the attacker will still have a difficult time. Because hardware wallets additionally require a PIN number.

6. Check the URL (Avoid fake software)

Another way that hackers gain access to your personal data is by convincing you to use fake software. Several fraudsters sell imitations of MetaMask, a well-known Ethereum wallet. They even promote these mobile wallets via Google and Facebook. Avoid click-through adverts on search engines or social media platforms and only download wallets from the official website.

Fake web apps

Not every fraud using cryptocurrency software involves wallets, though. Some scammers create fake websites that will appear identical to the real ones. The only giveaway will be a slightly different URL. So keep an eye out for such scams.

7. Don’t enter your seed phrase on any website.

If you use a wallet that has a Chrome or Firefox plugin, it will continually prompt you for your PIN. It will also ask for your password whenever you restart your browser. Your wallet will close even if you take a little break. But a wallet browser extension like MetaMask, Coinbase Wallet, or Brave Wallet will ask for your seed phrase during installation. So how would you know when not to trust a website? A website is unquestionably fake if an unexpected window pops up while you’re browsing the internet. The most secure course of action is to close the tab and delete the cache in your browser.

8. Avoid public WiFi

When you connect to an open WiFi network, anyone in the vicinity could spy on you using software like Wireshark. Such software allows them to determine if you are browsing crypto sites based on the data they get. They may even be able to see your transactions in some cases. So public Wi-Fi is a big NO.

9. Subscribe to a VPN service

Consider using a VPN subscription when you trade crypto. VPNs may be significantly more affordable if you pay in advance for several months or years.

10. Be wary of email files

Getting a user to open an email and download a malicious file is one of the most common tricks attackers use to steal crypto. The emails are usually skillfully crafted and appear to be sent by a reliable business. Stay wary, and don’t open any unknown attachments.

Conclusion

As the crypto market reach grows, so do the number of hacks and scams in the space. A few of the ways to protect yourself are using 2FA, backing up your seed phrase, avoiding communal WiFi networks, and using a VPN. You can only stay as safe as the measures you take.

FAQs

How to protect crypto from hackers?

You could use hardware/offline wallets. They are less vulnerable to attacks. Also, using 2FA, backing up your seed phrase, avoiding communal WiFi networks, and using a VPN can help.

What is the safest way to hold crypto?

One of the safest options to store your crypto is a hardware wallet. However, you need to take additional precautions too.

Is it better to hold crypto in a wallet or exchange?

Crypto holdings should not be kept in any hot wallet, especially an exchange account. It is better to withdraw the majority of your holding and move it into a cold wallet. Learn more about them here.

How do you hold crypto for the long term?

Having a strategy before you begin is crucial. That will motivate you to hold on when the going gets tough. Knowing how to store your crypto safely will also help.

Disclaimer: Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions. The information provided in this post is not to be considered investment/financial advice from CoinSwitch. Any action taken upon the information shall be at the user’s risk.

Share this:

IN THIS ARTICLE

Subscribe to our newsletter

Weekly crypto updates and insights delivered to your inbox.

Browse our Newsletter Archive for past editions.

SnowSnow

Thank you for subscribing!
Please verify your email to start receiving the latest issues from Switch in your Inbox.
Powered by

Weekly updates from the cryptosphere and the world of finance delivered to your inbox.

Build your crypto portfolio on the
CoinSwitch app today

Scan the QR code below or find us on Google Play
Store or Apple App Store.

Build your crypto portfolio on the
CoinSwitch app today

Scan the QR code below or find us on Google Play Store or Apple App Store.

Weekly updates from the cryptosphere and the world of finance delivered to your inbox.