Every day there is an increasing amount of stories about people losing their Crypto. With this in mind I thought I'd talk a little about some Golden Rules for Crypto Noobs.
1. NEVER GIVE YOUR SEED TO ANYONE.
2. Store your Seed somewhere safe.
3. Only Self Custody when you're confident it is safe to do so.
4. Educate yourself on the correct Wallet to use.
5. Educate yourself on Social Scams.
6. Educate yourself on Phishing Scams.
Self Custody.
The first decision you will have to make is whether to Self Custody or not. In my opinion every Crypto enthusiast should be working towards Self Custody, however, you should only do so once you're sufficiently educated to do so safely.
The alternative to Self Custody is to have your Crypto held by a third party, like Coinbase for example. There are 3 main risks to this.
1. Financial Fraud. Think FTX, where the exchange were using customer deposits to bid on illiquid Crypto coins.
2. Financial Regulations. New regulations came into effect not too long ago and as a consequence we are seeing an increase in peoples accounts being suspended/frozen. You must KYC, you must take and pass Crypto and Finance questionnaires, and you must also make sure that any wallet you are sending to or recieving from are 'squeaky clean'.
3. Scams/Hacks. It's not very common for an exchange to get hacked/exploited these days, and even when it does happen, the exchanges make so much money that they can cover the losses and the customer isn't affected anymore. It is very common however for people to get there accounts hacked or scammed. Social scams are becoming increasingly sophisticated, and Phishing scams are constant, all designed to gain access to your account and drain funds. This is also considered user error, and the exchange will do nothing about your missing funds. 2FA should be enabled wherever possible, and obviously never give your password out to anyone.
Wallets.
When you decide you're ready to Self Custody your Crypto, it's time to choose a Wallet. Not all wallets are compatible with all of Crypto. You have to first decide what kind of wallet to use. Hardware, Desktop, Mobile etc. Then you will have to educate yourself on which wallets are used for the Crypto you are wanting to Self Custody. Please do not move any Crypto to a Wallet until you've confirmed that it is compatible. It's also good practice to send a small test transaction first before moving the larger stack.
Seed.
It cannot be overstated enough how important your Seed Phrase is. By far, this is where most Crypto Noobs will lose their funds, either by incorrectly storing their Seed Phrase, or by telling it to some one else. Your Seed is sacred, do not share it with anyone, ever. If any customer service asks for your seed, they are scammers. Also make sure you have recorded it correctly and it is kept safe and secure. If you lose your Seed, you could lose your Crypto, there is no recovery email to get it back. If some one gets to know your Seed, they can drain your wallet in seconds, it is highly unlikely you will get the Crypto back after it's gone.
Always DYOR.
