Explained: how to secure your crypto wallet?

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One of the reasons many people are reluctant to engage in cryptocurrency is the security risk.

Hackers can steal cryptocurrency by stealing or guessing your password, hacking an exchange, tricking you into phishing attempts, and many other methods.

The most common attack, however, is the theft of a crypto wallet’s private keys. Obtaining a crypto wallet involves receiving a private key, which you should keep in a safe place.

Although it is unlikely that you can be completely protected against all possible attacks, there are many things you can do to secure cryptocurrency and reduce your level of risk.

How to secure your crypto wallet? 1. Choose your crypto wallet carefully

Online wallets, also known as “hot wallets”, are easy to use and do not require expensive investments to buy dedicated hardware devices, but they are vulnerable to online hacks or theft.

If you have or plan to buy a significant amount of cryptocurrency, storing those assets in a hardware wallet promises much more security than online wallets.

2. Always use two-factor authentication (2FA)

Not using 2FA for your crypto wallets is just too risky. By requiring verification before engaging in account operations such as logging in, withdrawing, or sending payments, you are essentially putting an extra layer of security on your funds.

When you enable 2FA, you will quickly see if someone is trying to access your wallet.

3. Change your passwords regularly or use a password manager

Given the flood of hacking cases, you can expect your credentials to be hacked at some point. Creating a tough password, keeping it secure, and changing it periodically is the least you can do.

When choosing a password for your crypto wallet, avoid using passwords that you have already used. Passwords should be stored in a password manager rather than in your browser (much safer). If you can write it down instead of using software, that would be great too. Finally, change your password every six months or so.

Also Read: Best Risk Management Strategies to Mitigate Risk in the Crypto Market

4. Keep your seed phrase in a safe place

A seed phrase, also known as a recovery phrase, is a set of words that functions as a master password, allowing you to recover your crypto assets even if you forget your password or lose your phone or your hardware device.

Unfortunately, there is no “Forgot password” option. Therefore, if you misplace your seed phrase, you will, without exception, lose access to your wallet. Keep the seed phrase offline and safe. Simply write it down on a piece of paper and keep it in the same place where you store your important documents.

5. Back up your wallet regularly

What should you do if you misplace or break your device? Your digital assets may be gone forever if you haven’t backed up your wallet. Backing up your wallet involves generating a digital key that allows you to access your wallet in case your device is lost or damaged. This digital key is stored outside of your device. For easy account recovery, use multiple backup devices.

6. Use the multi-signature feature

As the name suggests, multi-signature wallets require transaction authorization via multiple keys, which means that a group of users must sign to approve a transaction. Some cryptocurrency wallet providers enable this feature, which prevents unauthorized users from accessing the wallet without the necessary digital signatures.

Without this permission, hackers will not be able to access your wallet and steal your crypto assets. If you haven’t already, check to see if your wallet has this option.

Also Read: Year End: Top 10 Crypto CEO Departures of 2022

7. The private key must remain confidential

Think of your private key as the equivalent of your bank PIN. You need to keep this safe as it is the key to your hard earned money.

Keeping your private keys offline is one way to protect your wallet and assets. You can either use cold storage devices or write them down on paper and keep them in a safe place.

8. Beware of phishing

Phishing is a type of targeted attack in which an attacker impersonates a legitimate entity in order to obtain your sensitive information, and you’d be surprised how many people fall victim to it. To avoid phishing, never log into your cryptocurrency exchange unless you are sure you are on the right site.

Bookmark the link or type the URL rather than clicking on a link sent to you. Also, do not respond to text messages, emails, or chats that ask for personal information. Finally, always check the details before sending payments.

Also read: How to secure your accounts on crypto exchanges? Here is the guide

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