Cryptocurrency has exploded in popularity these days. It is mainly due to bitcoin's success and many other cryptocurrencies following suit. As the world becomes more digitized, innovative and secure cryptocurrencies are being developed to meet the needs of a new generation of consumers. Cryptocurrencies and crypto apps are becoming more user-friendly, with features that allow for greater privacy and security. These apps are paving the way for a future where digital currencies are used more frequently in our everyday lives.
However, with its increased usage come new risks for holders of cryptocurrency. There are many ways you can prevent your cryptocurrency from being hacked including using cold storage wallets, offline transactions, and hardware wallets. These methods will help ensure that if someone gains access to your computer or smartphone they cannot get access to your private keys and therefore steal any funds you may have on them.
In this article, we’re going to discuss how these methods work so that interested parties can better protect their own money as well as warn those who are not yet familiar with cryptocurrencies.
Store your cryptocurrency offline in a hardware wallet
Cryptocurrency is a digital currency that can be used in exchange for goods and services. Some companies use their form of cryptocurrency that may be called tokens, which can only be used for that particular company's goods or services. Although there are over 10 000 different cryptocurrencies, the most well-known on the market currently is Bitcoin. Cryptocurrencies work through decentralized technology called Blockchain. Because cryptocurrencies are investments, they need to be securely protected from any form of malicious attack. Hackers are constantly on the prowl, searching for easy targets and the last thing you need is to become a victim. Hot Wallets are always connected to the internet, making them vulnerable to attacks. Examples of these are desktop, exchange, and mobile wallets. Cold wallets such as Paper Wallets are not connected to the internet, making them a safer option. Hardware wallets are often seen as the best. These are physical devices, through which your crypto is kept offline, and you store your keys in a private device. This protects your crypto against hackers, but your crypto is still readily available when needed. Hardware wallets are cold wallets, meaning that, because it's offline, your crypto is secure.
2 Factor Authentication
2FA has been widely used as an added safety and security measure and is an integral security layer that should always be used. The wallet ID and password that you initially receive when setting up your crypto account are the first layers, but once 2FA has been set up, you will receive a unique code that is generated for and will enable every login. You could choose to use Yubikey, Google Authentication, or select the option to have an SMS sent to your mobile device. The reasoning behind using 2FA is simple. Passwords, regardless of their strength are vulnerable and can be compromised. Even if a hacker gets through your password, they will not have access to the second Authentication step since the key lies with you. You're offered the added protection of a code that is generated each time you log in, and this is a helpful deterrent for online hackers. The most highly recommended 2FA method is the Google Authenticator since it's free and it generates a new code every 30 seconds.
Never use the same password for multiple accounts
It doesn't take a rocket scientist to figure out that humans are the weakest link in cyber security. Using the same password or even variations of the same password on different accounts makes all of them equally vulnerable. This means that should a hacker manage to break through one of your accounts, the rest become fair game. Every security specialty will advise that a unique, strong password for each account is an essential element to your online security, and those who fear forgetting these can make use of a password manager.
Technology has been created to make life easier, and with constant innovation comes constant change. We should however never neglect our assets, or take their safety for granted. A simple example is buying a new phone. One of your very first purchases with it is a screen or phone protector. Similarly, with your cryptocurrency, you're investing hard-earned money that needs to be protected. Hard wallets are an excellent innovation, and as is evident from the 2FA, there is no such as too much security. Used in tandem, these tools will be a hacker's nightmare.