Safety tips for blockchain investors
Learning how to keep your wallet safe has never been more important. Cryptocurrencies are the newest asset class in the world at this point. With this designation, comes a set of rules and responsibilities that many of us are far from used to.
Because of this and what the blockchain is at its’ core, users now also own the responsibility for securing their assets, despite the high security standards that most blockchain firms espouse. Making this even more important is the fact that over the course of the short history of cryptocurrencies, numerous ico data breaches as well as general blockchain data breaches have already occurred due to weaknesses in how blockchain groups store investors and user information.
The protection that we are used to getting from powerful technology companies has effectively gone out the window. We are now responsible for every facet of our financial lives, overarching which is the fact that it’s on us to effectively prevent data breaches. While this may seem like an impossible endeavor, a roadmap toward achieving adequate security of your crypto assets can be established. Before we jump into the specifics of this however, the central tenet of blockchain wallet security needs to be established. If you do not own the private key to your crypto wallet, then you are not the owner of any of your crypto assets. That means, for example, if you are a Coinbase user, you do not really own your private keys. The same goes for every other third party platform. With this in mind we can now move on to a simple list to follow to truly answer the question of how to secure your crypto assets:
In most cases, an effective starting point is mitigating against any sort of third-party risk as we suggested above.
- While they are necessary for cryptocurrency trading, exchanges cannot be trusted to help you keep your investments safe over the long-term. With this under consideration, go by the general rule of keeping a higher percentage of your investments on a hardware wallet and a lower percentage of your investments on your exchange account for trading purposes.
- When you’re looking for a hardware wallet, for now, consider only those which come from the companies called Ledger or Trezor. This is because they have both been around the longest and are therefore the most tested and the most trusted in the blockchain community. Simultaneously, since hardware exploits have occurred from third-party sellers of these wallets, you should only trust those wallets which are sold by the companies on Amazon or on their sites.
Even though hardware wallets are always the best options, for trading and other short-term activities, it is given that you will still have to use mobile or software wallets. Therefore, keep these four small rules in mind before and while you are using any wallet that falls into these two categories
- Never use anything related to small-cap altcoins, including their wallets. This is simply one of the best crypto security tips because, generally, the smaller the coin’s financial resources, the smaller its’ development team is, and therefore, the worse its’ security measures are as well. This is usually also considered to be on the biggest risks related to ico data breaches. Shortly after an ICO finishes, projects do release their first wallets but by definition, these efforts are extremely basic at best, especially related to their security measures.
- Once you have chosen a trusted mobile or software wallet, make sure to run its’ central program through any virus or malware scanning programs or sites that you have access to, like https://www.virustotal.com/en/.
- Even with all of this knowledge in your arsenal, it’s always better to choose hardware wallets above all else!
- Whatever choices you make related to cryptocurrency wallets, always utilize their backup features, which usually come in the form of time-released .csv files of your holding. This is a unique advancement in financial technology as it does not exist with fiat currencies of any kind! The most secure way to deal with these backups is to have physical copies of them, preferably in different geographical locations.
Password management needs to be approached differently. We could all use some education here. Passwords are far from simple to work with however, the more you increase your own password security, the more likely an attacker will choose to forget you in favor of a weaker, more vulnerable target.
- For starters, get a password manager. When you own one, you no longer have to worry about remembering your passwords, plus most password managers offer expertly randomized options in terms of what passwords you can generated with them. Even though this is the case, the risks still exists that your password manager could be hacked, though the best apps will notify you in time for you to secure your information.
- Remember that with any app or third party service, enable 2-factor authentication. Two excellent examples of trustworthy apps for this purpose are Google Auth and Authy.
Don’t speak about your holdings in public places at all! You are the only one protecting your assets, and an easy way to protect them is to form good habits around keeping information related to your crypto investments as close as your bank account info, if not closer.
- Never check your holdings on public transportation or public internet sources. These are usually considered to be the two easiest in-roads for hackers to steal your information short of stealing it physically.
- In terms of who you speak about your investments with, be as deliberate as you would be with sharing your passwords. Tell only your closest family members any information related to your holdings.
- Last but not least, remember that to truly achieve long-term success as a crypto investor, these top security tips should also be applied to icos as well, in terms of what data you share with them and how you choose which ones to invest in. ICO data protection and security is just as important as general Blockchain wallet protection and security. ICO safety tips equal general Crypto security tips. Even more importantly, much of this can be applied to any aspect of your life in which you feel that you need better tips on data protection. The disruption of the blockchain extends just about everywhere.