How to Protect Your Crypto Assets
Protect Your Crypto Assets
How to Protect Your Crypto Assets

By CryptoSorted | CryptoSorted | 1 week ago


“Step up your security now; don't wait, don't be lazy. There are a thousand things you can do to better protect yourself that you probably don't even know about” ~The Wolf of All Streets

We all consider ourselves to be “crypto investors” –even the shitcoin shillers; regardless of whatever crypto asset you choose to put your money into, it will be wise to observe the first rule of investment.

“Rule #1: Never lose money. Rule #2: Don’t forget Rule #1.” – Warren Buffett

There’s no wisdom in earning or buying crypto only to lose them to some faceless scammers out of sheer negligence or ignorance like Peter Schiff.

Here are 4 best ways to protect your cryptocurrency, from unnecessary and avoidable misfortunes. This list is by no means exhaustive and should be taken as a first step towards ensuring the maximum safety of your digital assets:

  1. Enable Two Factor Authenticator (2FA)
  2. Store on Hardware Wallets
  3. Don’t “Store” on Exchanges
  4. Trade on “Refutable Exchanges” Only

When it comes to protecting your crypto assets; you can never be too secure. ~CryptoSorted

ENABLE 2FA

Enable 2FA

Two factor authentications are the combination of “something only you know with something that you have”. And any access to your account must utilize both in order to be successful; and what are these?

  1. Your password
  2. Your phone (mobile device)

The days when a strong password (something like: <.<==+Sekure]{] ) is all one need to keep their account secure and free from unauthorized access are long gone. Today, having a strong password is just the first baby step necessary to keeping your accounts from hackers.

As a result, to be on the safer side you are now required to enable one or multiple 2FA security options and Apps such as:

  1. SMS authentication
  2. TOTP & Push-Based Authentication
  3. Google Authenticator
  4. LastPass Authenticator
  5. Duo Mobile 2FA Security

However you must note that these by themselves are usually no longer sufficient to keep the ever daring and equipped hackers out of your account. Most especially the SMS authentication; as hackers can now swap your SIM number and use it to reset your exchange account passwords as happened to one of crypto twitter most active traders recently –The Wolf of All Streets. Thankfully for him he doesn’t use SMS for 2FA; the hacker would have been able to reset his password and most likely erased his balances.

Despite the challenges and limitation of two-factor authentication methods; they’re still useful and necessary in keeping your accounts safe and secure from intruders. Everyone is responsible for their own protection and 2FA apps are a great way to step up security and create a safer digital experience.

The Author uses Google Authenticator App to secure their accounts and hasn’t recorded any problem with it for years now. But that doesn’t mean it should be your final consideration as you take the necessary steps to keep yourself from faceless hackers.  

STORE ON HARDWARE WALLETS

Store your crypto on hardware wallets

If you are investing HODLing large amounts in crypto assets –anything from $10,000 it might be worth considering investing in a hardware wallet to store and securing your crypto.

What are hardware wallets?

 Hardware wallets are physical devices much like flash drives that stores your private keys.

The most fascinating thing about hardware wallets is that your private key never leaves the device as the entire transaction validation process is done within the hardware wallet itself and not on the computer; thus you can use them even on an untrusted computer to make transactions and once you unplug the device it is as safe as a little baby in their mother’s tender hands.

More so, it is worth mentioning that even hardware wallets are still susceptible to attacks such as –manufacturer errors, theft, and other physical and forceful means of getting you to reveal your pin or password to an attacker.

Aside robbery, theft, loss of the device and baring any manufacturer erros or misconfigurations; hardware wallets are better fashioned to offer you maximum protection against remote attacks such as: malware attacks, computer viruses, and various other remote dangers. 

So while shopping for a hardware wallet it is good you purchase from the most credible and trusted manufacturers out there such as:

  1. Ledger
  2. Trezor
  3. KeepKey

If you’re serious about taking the security of your crypto assets into your own hands then hardware wallets are a good choice and better still to buy from trusted and reliable manufacturers. One last word though; you must be able to protect the device from physical unauthorized access; aside that, you’re as secure as a lion in its own den.

NEVER “STORE” ON EXCHANGES

never store your crypto on exchanges

“Not your keys, not your crypto”.

How many times have you possibly heard this phrase thrown out?

“Storing” your crypto on exchanges is like taking your money to the bank and should we surprise you; your money is better off stored in the bank than on exchanges because should anything go wrong at least most banks have depositors funds insured but with crypto exchanges; one hack and your money is gone for good with no hope of recovering.

The exchanges, except decentralized exchanges maintain custody of your crypto assets stored on them. They own and only they can access the private keys to your crypto. If they decide to go rogue some day or by any misfortune gets hacked; you will most likely lose all of your coins stored on them and there will be no means of getting a refund.

Though some exchanges like Binance have implemented some form of insurance funds by staking 10% or similar amounts of their monthly profits against any possible future losses due to hack or any other disaster; so they may be able to refund investors their coins; but would you rather put your safety in someone else’s hands or in your own hand?

Who’s word should you trust your security to –yours or another’s? I guess you will rather you keep your keys.

Exchanges are meant for “trading” and related services NOT saving or storing your crypto. ~CryptoSorted

TRADE ON “REFUTABLE EXCHANGES” ONLY

Use secure exchanges only

Obviously you must keep your crypto on (centralized) exchanges if you want to: trade, stake, lend or participate in any of the passive income investment opportunities they offer; and those are the only reasons why you should have any crypto on any exchange by the way.

However you can’t possibly use just any exchange as many of them are either scams, soon to become scams or just too risky due to their low credibility.

Therefore you, in choosing what exchange to invest with; you need to consider a few important factors such as:

  • KYC and AML requirement compliance
  • Reputation and Credibility
  • Have they ever been hacked? If yes, how was the situation handled?.
  • Insurance fund. Have they taken any proactive steps to protect investors against losses should there be a loss due to hack in the future?
  • Fiat  Can you buy crypto and pay directly with fiat using your credit card?
  • Leverage trading. Do they offer leverage trading to accommodate more experienced and professional market players? This can tell on their level of seriousness and commitment.
  • Are most of the trade volumes from wash trading or some real humans actually trust them enough to trade large amounts on their exchange. I wouldn’t want to be a scapegoat.
  • How are the crypto prices on the exchange compared with the rest of the market? Price discrepancy could be sign of low liquidity or volume on an exchange and thus your trades may not execute as expected. Source.

To get you started in the right direction from the get go; we would suggest you begin your journey into the world of crypto exchanges with the following hand-picked options:

a. Binance: Arguably the world's leading and largest cryptocurrency exchange by trading volume.

b. KuCoin: Join over 5 million global users on KuCoin - The People's Exchange. KuCoin is one of the most solid exchanges out there that's not so well talked about, probably due to poor marketing -something the team is currently working to address.

c. Coinbase: Easily swap fiat for crypto and vice versa; also arguably the most regulated and reliable crypto exchange in the market. Coinbase is the easiest place to buy, sell, and manage your cryptocurrency portfolio.

d. Bittrex: An established crypto trading for both experienced professionals and novice customers alike.

e. Kraken: Secure, reliable and trusted crypto trading exchange. Kraken is a top exchange and a most highly rated and reputable crypto exchanges in the market.

For want of space we can't possibly list all the best exchanges out there in this single post but these 5 are the most secure you can begin with.

According to a recent CipherTrace report, cryptocurrency users, exchanges and investors suffered $4.5 billion in crypto-related losses resulting from thefts, hacks, and fraud in 2019 alone –more than double record from previous year.

Would this trend continue through 2020 and beyond? Your guess is as guide as ours –yes! Hackers wouldn’t give up and are continually devising new strategies to take your crypto from you.

This post is a just wake-up call for all of us to come to term with this fact and take proactive steps to keep our hard earned crypto from merciless hackers and scammers.


CryptoSorted
CryptoSorted

Follow on twitter: @crypto_sorted


CryptoSorted
CryptoSorted

A leading source of actionable crypto trading and investment guides; published strictly for your success. 🔮https://cryptosorted.info

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