Boasting seamless payments and immunity to both deflation and inflation, decentralized currency is considered the future of money because it offers economic growth and flexibility. Though great demand for and price increases in decentralized digital currencies, such as Bitcoin and Ethereum, are welcome news for many investors, digital currencies pose a risk: They’re a magnet for cybercriminals looking to prey on valuable resources. In addition, when it comes to the cybercrime economy, cybercriminals will continue to favor cryptocurrencies, as they’re unregulated and anonymous.
Aside from these characteristics that make cryptocurrencies appealing and useful to cybercriminals, monitoring suspicious activity is a major challenge since cybercriminals are able to cover their tracks digitally. On top of that, you’ll have no legal remedy if your cryptocurrency account is compromised because government institutions or central banks currently don’t monitor decentralized digital currencies.
However, if you want to invest in cryptocurrencies, don’t be afraid. There are several strategies available to keep your cryptocurrency earnings secure. Here are seven of them:
- Take Advantage Of Cold Storage
Cryptocurrencies are commonly held or deposited in either a hot wallet or a cold wallet. Because hot wallets are linked to the internet, you may easily access your account for personal use. While convenience is inexpensive in most cases, it can be expensive in others. Hot wallets are undeniably convenient, but remember that they’re a prime target for cybercriminals.
In contrast, a cold wallet is 100% offline. You can only access your account via a private key. This key can be noted or saved on a personal thumb drive without internet access. The fundamental benefit of having a cold wallet is that your earnings can only be transferred if you have the private key, which underscores the need to keep the private key secure.
- Use Two Strong Passwords
Using two strong passwords is especially critical for those who have considerable cryptocurrency investments. Since cryptocurrencies are popular targets for cybercriminals, avoid using the same password for all your accounts. To be safe, assume that all your accounts will eventually be affected by a security breach. Keep in mind that cryptocurrency is a pioneering technology that continues to advance, and the most efficient and stress-free way to protect your wallet is to employ tested security strategies.
Limit your risk or vulnerability by using a distinct, secure password for all of your accounts, applying multi-factor verification, and restricting the lifespan of passwords when possible. Trusted password managers can assist you in automating this procedure and eliminating guesswork. Furthermore, cryptocurrencies and standard finance investments, such as money or stocks, may be secured through crypto asset protection solutions like offshore trusts.
- Update Your Defenses Often
There are various strategies to protect your assets, so regardless of the method you pick to secure your cryptocurrency earnings, it’s critical to keep your defenses up to date. Consider banking institutions. They’re insured and have scam security measures in place to assist in recovering any compromised accounts, but they still need you to reset your PIN regularly. However, because cryptocurrency accounts and wallets typically lack these types of security measures, it’s up to you to ensure that your safeguards to keep your assets secure are up to date.
- Avoid Using Wallets Stored Or Managed By Providers
A popular strategy is to use wallets to store your cryptocurrency profits. These wallets are usually hosted on your computer or by a provider. On the other hand, giving a provider the right to hold your wallets won’t be a good idea because you’ll give them permission to retain your private key on their servers. Worse, everything is entirely out of your hands. However, many investors choose this path because it requires the least amount of advanced computing.
Even if it involves the least technical effort, your private key is at risk. For example, the provider’s servers might be hacked, the provider could cease operations, or the government or other legal entities can acquire the company through a merger and acquisition process.
It’s recommended to use a hardware wallet, such as a USB-based gadget that turns information or data into a code, to prevent unwanted access and to store your private key and other vital information. When compared to other techniques, the decrypting process is quite secure.
- Diversify Your Investments
Are you concerned that hackers will drain your account in a single attack? You’re not alone. The good news is that you can simply diversify your crypto assets across many accounts. In theory, this sounds like giving hackers more targets to steal your cryptocurrency gains. But on the positive side, it will save you from losing all of your capital in a single swipe. For example, you can retain your cryptocurrency assets in hot and cold wallets.
- Be Vigilant When Using Mobile Gadgets
Most multi-factor verifications involve the use of smartphones to deliver alerts or codes. So, cryptocurrency owners should engage their phone providers and establish parameters that might stop cybercriminals from stealing vital information. For example, you may request your cell operator not to port your phone number. This will help protect your cryptocurrency earnings from hackers. To further decrease the likelihood of your phone number and data being stolen, you can advise your cell phone provider to prohibit or stop call forwarding services.
- Encode Your Information Or Data
Encoding your cryptocurrency-related equipment and wallets might be a beneficial way of ensuring safety and security of your cryptocurrency earnings. You can use various information encoding apps. However, this greatly depends on your device.
You can also back up your digital assets to reduce risk. Just ensure the backup drives are properly encoded to keep your cryptocurrency earnings as safe as possible.
Final Thoughts
The major advantage of cryptocurrency is that it’s a decentralized technology. Unlike stocks and equities, there’s no government support for cryptocurrency holdings, and there’s next to no mechanism to retrieve your cryptocurrency in the event of a loss. This makes cryptocurrencies an ideal target for cybercriminals, who can simply get access to your digital wallet or account, take your money, and then vanish.
However, you can put up a strong defense to protect your cryptocurrency earnings, such as utilizing strong passwords and diversifying your investments.
