No one wants to deal with the constant price fluctuations in cryptocurrencies and then lose their investments just because they couldn’t keep it safe enough from straying hands and eyes.
Naturally, the decentralised and anonymous nature of cryptocurrencies is particularly endearing. However, it makes it extremely difficult to track down your investment when it goes missing.
With no central authority presiding over them and no customer service centre to give your complaints, there is certainly no one to hold accountable for your crypto investments when they go missing. Hence, you are left with safeguarding your interests in any way you can.
Of course, this is a task that is quite challenging especially as a beginner in the crypto scene. This is why we’ve put together a few tips that could help you guide your investments and minimize the risks involved.
Adopt the Anonymous Nature of Cryptos
These days, it is all too easy to track one’s life via the internet. Online privacy invasion is the norm these days. Hackers and other cyber criminals can use your email address, work details or another personal detail to invade your account.
Hence, one of the best ways to keep your crypto where it belongs is to keep your personal details offline. If keeping your email address publicly online is important, you could create a new and anonymous email address streamlined to only crypto transactions. That way, no one can trace anything back to you.
One other thing to do is to streamline and double-check the sites you visit especially the URLs to cryptocurrency-related websites. It is all too easy to encounter these cyber criminals in shady sites, hence, giving them access to you. And please keep your private keys private.
Use a Cold Wallet for Crypto Storage
Knowing how difficult it is to keep your private keys safe, it is often tempting to take up offers of wallet storage from exchanges. With hot wallets from exchanges, you get to two birds with one stone. You can buy and sell your cryptos and still keep the remaining safe without worrying about the private keys.
In reality, this is one of the easiest ways of storing your cryptocurrencies but what happens when the exchange gets hacked? Exchange hacking episodes is the rage these days. You see, when you use hot wallets, it means you are giving the exchange authority over safeguarding your cryptocurrencies and private keys.
Thus, you’re only minimizing the risks of your cryptos being stolen but not really close enough to eliminating these risks. Using a cold wallet is one major way of ensuring your crypto stays in the wallet.
With hot wallet storage not in every sense risk-proof, you could decide to keep what you need at that moment in the hot wallet and keep the rest in a cold wallet for future access.
The paper wallet form of cold storage is one of the easiest. Forget about the internet, cloud storage and all and just go back to the age where paper cuts it. All that is needed is the printout of a wallet that stores all your public and private keys. Apart from human mistakes, your funds are safe from online criminals.
You could also try your hands at hardware cold wallets. You get to keep your funds in small devices that you could connect with your computer and transact without typing out details of your wallet.
At the risk of losing these devices, you can recover your crypto by a code received when the wallet was first set up. Ledger Nano S, KeepKey and Trezor are examples of hard wallets that would give you the flexibility and security you and your funds need.
Ifeanyi Egede is an experienced and versatile blockchain technology and cryptocurrency content writer and researcher with tons of published works both online and in the print media. He has helped several startup companies grow their businesses in the blockchain and cryptocurrency space. Ifeanyi has close to a decade of writing experience, and when he is not writing, he spends time with his lovely wife, Tega and adorable daughter, Chimamanda.