Crypto trading security: useful tips on how to trade safely

Crypto trading security: useful tips on how to trade safely

Cryptocurrencies are usually safe in themselves because they're based on cryptography. It is impossible to "hack a blockchain" or a private key.

Trying to hack a cryptographically secure algorithm will require an unfeasible amount of technical skills.

The only way a wallet can be stolen is through the personal negligence of its owner. And many people, especially those who are just starting to invest in cryptocurrency, are not careful enough.

Consider the cryptocurrency security tips we describe in this guide to keep your digital assets safe and avoid paranoid thoughts before you go to sleep at night.

Photo by Austin Distel

Even in the short history of cryptocurrency, there have been countless cases of cryptocurrency theft. These cases range from significant cryptocurrency exchange hackings to common attacks and phishing attacks. 

One of the most notable occurred back in February 2013, when Mt. Gox was hacked out of approximately 850,000 BTCs (worth $450 million at the time). At that time, Mt. Gox was the largest exchange of Bitcoin, and everyone trusted it, but it was still hacked.

Cryptocurrency Security Tips

Do Your Research 

There are biased parties that require payment all over the internet. Many of them remain anonymous, hidden behind avatars. Some of them have their plans.

When you study new coins, ICOs, or exchanges, you should ask yourself who gives you information.

The choice you make in cryptographic form affects your money, and no decision should be taken lightly. You should not blindly listen to the advice of popular influencers. 

Of course, they may have a lot of valid points, but it is always better to do your own research as well. To see real reviews on different brokers, take a look at That Sucks.

Before you make a financial decision, go into business, and do some research. Make sure that your next step is in your best interest. 

Beware Of Phishing Scams

A prevalent scam technique used by hackers is to create a fake, identical version of the exchange page or web wallet they use and send an email with a link to the victim, usually with a strong message that convinces them to log on and take action immediately.

Many people go to these sites, enter their data, and hackers use the data to their advantage. If you want to avoid phishing, always check if the link displayed in your browser perfectly matches the link to the exchanger or web wallet.

Keep Your Device Safe

Make sure the antivirus and firewall are on at all times. Do not install software that you are not sure is safe. Ensure that you never download suspicious attachments and review the reputation of the software you are about to install using Google, social networking sites such as Reddit, or friends more knowledgeable about the subject.

Don't Store Your Cryptocurrency On Exchanges

You can be sure that you are taking the right steps to protect your cryptocurrency. However, you don't know if your cryptocurrency exchange is doing the same. There have been many notable cases where large exchanges have frozen or lost funds to their users due to technical errors or hacking. Always withdraw funds from your exchange to your wallet, if you do not plan to trade them there so quickly.

Enable Two-Factor Authentication

Two-factor authentication includes an additional level of security for the authentication procedure, making it difficult for an intruder to penetrate your wallet or exchange account because knowledge of the password alone is not enough to gain access to it.

Most wallets and exchangers offer two-factor authentication options, such as requiring a random PIN sent to you via SMS or email.

Photo by Chris Liverani

Use Difficult Passwords

When creating a wallet or cryptocurrency account, you should always use a robust password. Try to combine uppercase and lowercase letters, numbers, and symbols wherever possible. Online password generators can also be used if you wish.

After you have created your password, make sure that it is stored in a safe place. It is best to write it down on a piece of paper to store it offline. You can also use your trustworthy password keeper.

Avoid Public WiFi Zones

Wifi hosts can redirect your browser to any page, which can sometimes be a simulation of your stock exchange or wallet.

They can also collect data transmitted over a network that includes your password, if necessary. If you have to access your wallet from public WiFi, use VPN.

Buy A Cryptocurrency Hardware Wallet

Hardware crypto wallets are one of the safest ways to store your digital assets. A hardware crypto wallet is a specialized device that stores a user's private keys inside an impenetrable circuit. It also allows them to sign transactions with a single click of the mouse.

It comes with a "seed" which is a physical paper that allows users to transfer their keys to another wallet if the device has been stolen or lost. 

Don't Get Caught In Pump And Dumps

A pump and dump are tactics by which an influential person, or group of people, generates a rush to get many people to buy crypto at the same time. By convincing all these people to buy a coin at the same time, its price rises astronomically in just a few minutes, allowing the organizers of the pump and dump to "dump" all the people buying the coin at a higher price.

It is a highly illegal practice in both traditional and crypto markets, and you should stay away from it not only for legitimate purposes but also to keep your cryptocurrency investments safe. The organizers will often try to lure you into participating by promising you a profit, but the fact is that only insiders and organizers will benefit from this venture.

It's not uncommon for a coin to drain more than 95%+ after the pump and dump have run out (as with ChainCoin). Therefore, this critical cryptocurrency security advice stays out of it.

Keep Your Holdings Private

There have been a number of situations where people have been attacked by scammers pretending to steal their cryptocurrency. One sad example is the case of a Norwegian who was brutally murdered after a larger personal deal to sell Bitcoins.

Stealing cryptocurrency is particularly attractive to criminals, say bank accounts, because of their anonymous nature.

Money that is stolen from a bank account is usually tied to an individual and can be extracted in some cases; on the other hand, Bitcoin and most other cryptocurrencies cannot be identified and are difficult to trace. 

Therefore it is imperative never to tell anyone how many cryptocurrencies you have in your hands. It is especially true when communicating with strangers at blockchain conferences or cryptocurrency meetings.

Another cryptocurrency security tip that is related to this is to add a password to your cryptocurrency portfolio tracker, if possible. Some crypto trackers offer this feature, and you should use it if you want to avoid someone discovering your assets if your phone is ever stolen.

Be Careful With Bitcoin Gambling Sites

Many people enjoy Bitcoin gambling because of the aspect of anonymity. However, this anonymity can also be a disadvantage. 

Many Bitcoin gambling sites operate without disclosing who is behind the site, making it impossible to check for appropriate licenses on the platform.

If you want to keep your cryptocurrency safe, you should only use verified Bitcoin gambling sites that have existed for at least a year and have some excellent reviews on the internet.

Photo by Clifford Photography/p>

Consider Encrypting Your Data

Most wallets with basic software allow you to download a backup .dat file containing your keys. You can use a program called VeraCrypt to encrypt this file and save it to a USB flash drive. Therefore, even if an intruder somehow manages to invade your device, he will not be able to manipulate your wallet if it is encrypted.

Stealing cryptocurrency has become an incredibly popular business in recent years. Their growing popularity is attracting the attention of groups of hackers who usually target banks as the cryptocurrency market turns out to be more profitable.

So do not panic or think that they are not a safe option. They are (or more) as secure as using online banking.

To Sum Up

Cryptocurrency is an effective way to move money from one place to another. However, web wallets, cryptocurrency processing systems, and exchange services are all subject to compromise.

Thus, crypto traders should learn the security features of online services before accepting the crypto-currency exchange. Also, it is equally important to adopt custom security methods.

Many methods can be used to protect your account. However, while they do inspire a sense of security when exchanging cryptocurrency, these methods are usually cumbersome and can reduce your experience.

All online exchanges are very different, and each site investor\trader has a specific set of goals and circumstances. Consider fees, liquidity, and availability, as well as your situation when you choose an exchange.

If you devote some effort to following the above measures, it is improbable that anything will happen to your cryptography. If you always remember these cryptographic security tips, then you should be safe from most of the danger out there.

Posted by inGenium Ltd

inGenium Ltd

iNGENIUM Ltd. is an software development company from EU which delivers a full range of custom .NET, web and mobile solutions for different business to meet partner's demand.

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