Headline: How to prevent hackers from intruding on your crypto wallet.
Date:
Body: So, what’s the safest car to buy? Well, it depends. Do you mean in resale value? Do you mean safest in rollover accidents? Perhaps you mean the most inexpensive to insure? Many different issues. In a similar manner, discussions of how to keep your cryptocurrency wallet safe will depend upon what form of wallet you have. You might have a hot wallet (custodial) stored with CoinBase. You might have a cold wallet (or paper wallet) at home and the procedures to keep these safe could differ as well Whatever type of wallet you have, it is certainly worth your time to consider how to secure it. In fact, in just 6 months, as 2020 turned to 2021, the FTC estimates that nearly $82,000,000 was stolen in cryptocurrency scams.
Problems with Custodial wallets:
Hackers are trying 24/7 to get into these. But, if you have your wallet hosted by Coinbase or Kraken, there is a well-educated team dedicated to keeping them out of your wallet.
Problems with Cold wallets (non-custodial)
- More often than you might believe, people either misplace or forget their password to open their cold wallet. As a result, the currency inside the wallet doesn’t exist.
- A cold wallet must be held in a safe (or something similar)
General Guidelines
- Don’t put all your eggs in one basket. Likewise, don’t place all of your cryptocurrency into one wallet. Experts usually seem to suggest keeping just enough in a hot wallet to do normal transactions, and keep the majority of your cryptocurrency offline in a cold wallet.
- Always backup your wallet.
- Beware of phishing scams. (Wow, that band from the 90s must be REALLY upset by this name of an attack. Sorry )
- Double check all addresses you are sending cryptocurrency to. Remember whitehouse.com? Yup, that’s a porn site. Be careful. Beyond the extension, be sure to check out the domain name too. There are some hackers out there who make a very convincing copy of paypal or other sites, and often the domain would be like “paypai” or something like that.
- Never use Public Wi-Fi when transacting with cryptocurrency. Hackers appear like sharks to a wounded fish.
- Password protect your mobile devices.
- Always store your private key OFFLINE!!
- If you do well with cryptocurrency, CONGRATULATIONS!! Don’t, uh, muck it up by bragging about is to friends and associates. You never know:
- Who is listening or
- Who your friend might innocently disclose to.
- Be sure to use a different password in all applications related to cryptocurrency. Make these passswords strong using upper and lower case letters, numbers and special characters.
- Consider using a password management function.
The Verdict
Everything comes down to don’t be rushed and don’t be greedy. If something is truly a good investment, it will remain so for at least a day or two to consider it. Similarly, if a deal is too easy, and you get an unbelievable value, look carefully at who is offering it. Read the contract a few times. If you don’t understand it, please consider having a lawyer look it over. If it is not worth the cost of an attorney, it might not be worth your hard-earned money.
REFERENCES
https://www.cnbc.com/2021/06/11/tips-to-help-keep-your-crypto-wallet-secure.html
https://www.investopedia.com/tech/ways-protect-your-bitcoin-investment-against-theft-and-hacks/
https://www.coinbase.com/learn/crypto-basics/how-to-secure-crypto
Editor’s Note: Please note that the information contained herein is meant only for general education: This should not be construed as Tax Advice. Personal attributes could make a material difference in the advice given, so, before taking action, please consult your tax advisor or CPA.