The fundamental tenet of cryptocurrencies is user autonomy and the capacity for an individual to function as their own bank. If handled and safeguarded correctly, it will be more difficult to access your funds than even the safest vault.

If you do not do this, you run the danger of having your e-wallet wiped clean. As you venture farther into the world of cryptocurrencies, understanding how to properly protect your digital money is essential.

Furthermore, it’s not just regarding storage. In the DeFi industry nowadays, a lot of cryptocurrency owners engage with DApps, indicating that you ought to figure out how to utilize your coins safely.

Trusting your currency with any anonymous DApp is not something you should be doing, just as you wouldn’t let an unreliable company manage your money. The same holds true for cryptocurrency exchanges where you can buy and sell. We’ll go over some methods for safeguarding your cryptocurrency assets no matter in an exchange.

Why should you Store Crypto?

Cryptocurrencies are intended to be traded via secure transactions over decentralized computing systems called block chains. Crypto wallets are the means by which you are able to exchange tokens between two distinct accounts, even though crypto tokens are stored on the block chain.

A public key, sometimes referred to as a wallet address, is shared across wallets to facilitate transfers of bitcoin ownership. It functions similarly to a unique bank account number. Moreover, every “account” has an exclusive private key. Keeping this data safe is essential to cryptocurrency storage.

A large portion of cryptocurrency theft results from hackers or con artists gaining access to private keys via exchange or wallet breaches or deceptions, tricking victims into disclosing them. Alternatively, if private keys and seed phrases are misplaced or inadvertently destroyed by the asset’s proprietor, tokens may be permanently lost.

Since bitcoin transactions are irreversible, solid safety is important. Given that cryptocurrency is decentralized and mostly unsupervised, your tokens are not guaranteed by a third party, and if anything goes downhill, your capital is not protected.

●      Pick the Correct Exchange for your Cryptocurrency

The majority of investors keep traditional financial holdings in brokerage firms, and cryptocurrency holdings in online exchanges. These trading platforms aren’t subject to the same level of regulatory scrutiny as brokerages, and there are a number of high-profile breaches that have cost people a significant amount of money.

The best defense against these issues is to pick an exchange carefully. Check for the following when picking an exchange:

• Security
• Insurance
• Regulation

Traders should take safety measures to guarantee that their investment account is safe from fraud in addition to choosing a secure exchange. One of the finest shields against theft is multi-factor authentication (MFA), and keys are among the safest types of MFA. Additionally, investors ought to make sure that antivirus and malware protection software is installed on their PCs.

●      Check for Important Security Measures Provided 

Increased supervision, Know Your Customer (KYC) inspections and Anti-Money Laundering (AML) safeguards are security measures for a centralized exchange such as Binance. Although there were problems with exchanges in the initial stages of cryptocurrencies, things have greatly improved since then thanks to authorities and exchange owners.

You must move your money into the exchange’s custodial wallet in order to use it. Given your perspective, entrusting your coins to the exchange may offer some protection.

Using the exchange’s wallet might be a better option if you’re new to cryptocurrencies or don’t know much about wallets. You avoid losing your cryptocurrency and unintentionally blocking yourself from accessing your digital wallet by doing this.

On the other hand, some individuals value the security of having full authority over their money. Your cryptocurrency could potentially be controlled by another person if you don’t truly own the digital wallet.

In order to increase your level of protection, there are a few indicators to watch out for if you’ve chosen to use a decentralized exchange or peer-to-peer services. Look for an audit from a reliable source while using a DEX.

Ensure that peer-to-peer services necessitate KYC regarding both sellers and buyers if you are going to use them. It should ideally provide an escrow service as well. Although it doesn’t totally eliminate the hazards, having a third party keep your money in escrow gives you and the person selling more security against fraud.

●      Keep your Exchange Account Safe

To ensure the security of your account, if you registered for an exchange, adhere to the recommended best practices. The advice you would heed for additional private data, such as your online bank account, is the same for these.

It’s simple to stop others from accessing your exchange account and its money by:

1.     Use a Password that is Strong and Updated Regularly

Identifiable data, such as your date of birth, shouldn’t be included in the password you use. Aside from being lengthy, be certain that it is specific to that account and includes capital and lowercase characters, numbers, and symbols.

2.     Activate 2-Factor Authentication (2FA)

An additional level of security is provided by 2FA with your mobile device or an authentication app in case that your password is hacked. Upon logging in, you must use the 2FA approach along with the password you created.

3.     Staying Safe from Phishing Attacks

Keep an eye out for frauds and phishing attempts via private chats, social networking sites, and emails. In an attempt to steal your money, scammers frequently pose as trusted companies and exchangers. Software from unidentified sites should also not be downloaded because they might have malware.

Closing Thoughts

The current state of the block chain business offers a multitude of security techniques to ensure the safety of your cryptocurrency holdings. Every storage option has advantages and disadvantages, so it’s crucial to weigh the trade-offs. As usual, be sure to thoroughly investigate any place you choose to place your cryptocurrency.