In this episode of the Be[In]Crypto Video News Show, host Juliet Lima offers several tips to help holders of cryptocurrency keep it safe.
Likening cryptocurrencies to precious childhood memories, Juliet explains the fundamental economic concept that value is largely derived from scarcity. Similar to events from the past, cryptocurrencies cannot be duplicated and must be protected appropriately. A thoughtful approach to the following suggestions will help anyone bolster their security.
The very first principle when it comes to cryptocurrency security is to keep your private key written down somewhere, and never share it with anyone else. Unlike cash in a bank, cryptocurrency can be held without any third-party intermediary. However, this makes the holder ultimately responsible for it. If the holder loses the private key, they effectively lose all the cryptocurrency in that wallet, as it becomes inaccessible without the unique phrase, which cannot be recovered.
Although anyone with the private key then immediately has access to the wallet, so it should not be shared with anyone. Due to hacking, it is recommended to physically write down the phrase and keep it somewhere secure, but memorable.
Another simple measure one can take is choosing a password that is sufficiently complex. One rule of thumb is to use a long sequence of numbers, symbols, letters (upper and lowercase).
As passwords have become essential to manage our increasingly numerous everyday accounts, password managers are an effective tool to help consolidate that secure information. Protected by a master password, once inside the manager, users safely store and generate sufficiently random passwords.
In addition to securing private keys and passwords, another simple step one can take to secure their crypto is to avoid using public Wi-Fi. These networks are almost always insecure, meaning that someone could easily be monitoring any internet connections, including access to crypto exchanges or wallets.
These should ideally only be accessed through a Virtual Private Network, which enables some measure of privacy.
As with any burgeoning industry, cryptocurrencies have their fair share of scams related to them. While rudimentary scams promising an exorbitant return on a relatively paltry investment still persist, fraudsters have become as sophisticated as the blockchain technology behind cryptocurrencies.
Some are able to utilize social engineering, performing confidence tricks on gatekeepers for access to exclusive information. Others take that talent online, creating mock websites of financial platforms, where users may unwittingly end up submitting their username and password to scammers.
Caution on exchanges
Even some of the biggest exchanges have fallen victim to scammers and cyberattackers. For this reason, users should be wary even on the most popular of exchanges.
While enabling exchanges with custody of our crypto is somewhat antithetical to the principle of personal responsibility at the heart of crypto, there are some benefits to using them. For instance, an exchange that has already been hacked is likely to have bolstered its security. Further consumer protections will likely be put in place as the industry continues to expand.
Anyone downloading anything onto a device should always be sure what it is. If for any reason they are uncertain of what they are about to open or click on, take a moment and think.
Who is sending this? What website is this? Does this really seem legitimate? Opening the wrong thing could install a program that might give someone easy access to anything kept on the device, including crypto.
A hardware wallet is a device with high-grade security used specifically for storing cryptocurrency. This device is separate from your computer or phone and has a singular purpose, to store cryptocurrency.
The two top brands are Trezor and Ledger, and while they can be a bit costly, for the peace of mind they may be well worth the added expense.
Another good practice is to enable two-factor authentication, which provides an added layer of security. In order to access accounts, users need a code generated from an external source, in addition to the initial password. This means that anyone trying to hack into an account would need both a password and a code generated on another device.
SMS verification should be avoided, as hackers can easily bypass this measure through SIM swapping. Popular apps for this, such as Google Authenticator, are fairly straightforward to set up.
Keep it to yourself
While some may feel inclined to share details of the fortune they’ve acquired through cryptocurrencies, it is usually wiser to keep such details to oneself. Others being aware of such holdings does in fact pose a security risk.
At one point, when some crypto may have appreciated even more spectacularly, they may feel inclined to take advantage of that information for their own benefit.
Check the address
Finally, when funds are about to be sent, the receiving address should always be double-checked. Due to the complexity and draconian security measures behind cryptocurrencies, addresses tend to be lengthy and complicated. Similar to the loss of a private key, once crypto has been sent, there is no getting it back.
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