As prices for cryptocurrencies rise, more people are buying them as investments. Many investors see the cryptocurrency market as a fantastic opportunity, but so do hackers and other criminals who view these new investors as simple pickings.
Crypto investments are risky, but keeping your money safe is important. While the collapse of “once” second largest crypto exchange FTX hasn’t left the headlines, it has suffered a hack worth $600 million. This, of course, added insult to injury for investors and ventures who had their assets exposed in the exchange.
You might wonder how to protect your cryptocurrency from being stolen in light of recent cyberattacks. Do you need to use a cryptocurrency exchange to store your coins? How to protect your crypto wallet from hackers? Besides, you should also learn basic terms like shorting cryptocurrency to ensure your smooth trading.
Therefore, in this article, we will give essential tips on how to protect your cryptocurrency investment from hacks. So let’s get started!
Why is Cryptocurrency a target for Hackers?
Cryptocurrencies are the target of hackers due to their growing popularity and increasing value. As more people invest in cryptocurrencies and the technology behind them, it becomes a lucrative target for hackers.
Cryptocurrency is attractive to hackers because they can reap huge profits from stealing your cryptocurrency or using your computer resources to mine currencies without your knowledge. These actions can cause serious damage to your hardware or even compromise your personal information if you’re not careful about how you handle them.
Which method of Crypto Storage is the best?
For keeping their coins and secret keys, cryptocurrency investors have a few different wallet options. These choices include custody wallets, cold wallets, and hot wallets.
- Many investors store their cryptocurrencies in third-party custody wallets, trusting exchanges to house their coins.
- Hardware wallets known as cold wallets are offline. They’re regarded as one of the most secure methods of holding cryptocurrency.
- On the other hand, hot wallets are internet-connected and are accessible as computers, phones, and internet apps.
How to Protect Your Crypto Investment From Hacks?
There are many ways to lose your cryptocurrency investment, but the most common one is hacking. Here are a few tips to help you protect yourself from hackers.
1. Keep Your Private Keys Safe
The best way to secure your crypto investments is to keep your private keys safe. To do that, you must prefer a hardware wallet that uses smart cards or USB devices to generate and secure private keys offline. This way, you will not fall prey to hackers and keep your crypto assets from online scams.
2. Use a Hardware Wallet
As mentioned above, a hardware wallet is the most viable option to store your private keys and other sensitive information. In fact, hardware wallets offer multiple advantages, such as two-factor authentication, which keeps your private key unexposed to potential hacking attempts.
Hardware wallets are an offline storage solution that will prevent viruses from attacking your system software while also keeping private keys out of reach from hackers.
3. Use Two-Factor Authentication
Two-factor authentication (2FA) adds another layer of security by requiring a second code besides your password. This can be sent via SMS or generated by an app on your phone when logging in from an unfamiliar device. If someone hacks your password, they won’t get very far without the 2FA code as well.
4. Use a Secure Password Manager
You must use a secure strong password manager to store your crypto from any type of hack. This way, you only have one strong password that protects all the other accounts in online databases where hackers most often look first.
What is the most Secure way to store Cryptocurrency?
You’ve decided to use a crypto wallet for storing your cryptocurrency in order to keep it safe. Good work! The following outlines some steps you can take further safeguard your holdings:
- Keep cryptocurrency on exchanges only as long as it is absolutely necessary.
- Never post your recovery sheet online if you use a hardware wallet, and never pick a pin code that is easy to guess.
- Never brag about your cryptocurrency assets in a public forum.
- Always take care when using your devices, and remember that they can be compromised at any time.
- Be wary of fraudulent websites while using software wallets.
- When offered the option of using two-factor authentication, sign up.