6 essential tips for securing your crypto wallet

The barriers to entering the cryptocurrency world are low, and people are opening up to it as they go. Regardless of the amount invested in digital assets, education is crucial to protecting your wealth.

A digital or cryptocurrency wallet is a physical wallet like a USB stick or an app that stores private and public keys, securing your digital currency. These keys are complex strings of numbers and letters that enable you to encrypt and decrypt any time you make a crypto transaction.  

When you venture into the crypto world, you need to register on a renowned crypto platform, like Binance, the world’s largest cryptocurrency exchange. Fees on this platform are among the lowest, and security is high. Say you want to invest in a widely-known cryptocurrency. You have to determine whether you want to buy Ethereum with debit card or another purchasing option that is available in your region, and you are ready to buy Ethereum. 

Last but not least, you choose how you’ll store your crypto. And because you want to rest assured knowing that your assets are protected, the following tips will help you safeguard them. 

Back up your seed words properly 

After you set up your wallet, you’re confronted with what might be an unfamiliar experience: backing up your seed words. A set of seed words is a series of words that can be used to derive all your account keys cryptographically, also called a “master key” or “secret recovery”. If your device crashes, you can use them to recover your accounts. Anyone with access to your seed words gets access to every account associated with these words. 

Note: If you’re in a hurry or a newbie to crypto, it might be tempting to just take a screenshot as a backup or even skip this step. However, remember that there are good reasons to store your seed words carefully. If you don’t back up your seed words and your device crashes, you lose access to all your cryptocurrency. PCs crash at some point, as they have moving parts that wear out over time. You can write down your seed words and store the piece of paper somewhere safe.

Pro tip: You need to enter your seed words in the order they are displayed to recover your wallet. When you write them down, make sure you don’t change the order!

Use a hardware wallet if possible

A hardware wallet is one of the safest places to store your cryptocurrency. It’s a USB device that keeps your key vault and is built so that your seed words can’t be moved out of it unencrypted. It’s tough for a hacker to infect it with malware because it has no internet connection.

Every time you conduct a transaction with your hardware wallet, you need to connect it to your mobile device or PC through Bluetooth or USB. A signature is generated by the wallet and delivered to your internet-connected device, allowing you to make transactions without exposing your key to a device that might be infected. 

Additionally, hardware wallets have PIN codes, so even if your wallet is physically stolen, it would still be difficult for the attacker to get your crypto. 

Pro tip: If you’re only storing a small amount of crypto, you may want to avoid spending money on a hardware wallet, as some of their most significant inconveniences are their cost and inconvenience. They can cost between £40 and £120.

Create a strong password

The key to protecting your password is to choose a strong and complex one, change it often, and store it safely. When you choose a password for your exchange account, crypto wallet, or other sensitive sites, don’t reuse already-used passwords and don’t include any personal information. Instead of saving it to your browser, you can use a password manager. 

What if you forget it? If you still have your seed words, uninstall and reinstall your wallet and import them during installation. This way, you restore your account and can use a new password during installation.  

Pro tip: You can press random keys on your keyboard and get something like this: k2k\d8[1xl;5hqf/pa.

Use two-factor authentication

When you first buy digital coins, it’s usually in an exchange account. Among the easiest things you can do to prevent hacks is to ensure that you buy digital currency safely and enable 2FA (two-factor authentication) for withdrawals on your exchange app. 

With 2FA, you must enter a code from your phone every time you withdraw cryptocurrency. It can be bothersome if you don’t have access to your phone when you want to withdraw, but it could also prevent crypto theft in case an attacker gains access to your account. If you don’t enable 2FA, you have to rely on the security of your password and email address to protect your assets, making it easy for bad actors to circumvent and attacks considerably harder to succeed.

Use an authenticator app

2FA is not enough – using an authenticator app for 2FA, like Google Authenticator, makes your exchange account more secure. Similar applications don’t send you the withdrawal code through SMS, so even if an attacker mirrors your messages or transfers your phone service to themselves, they still can’t get your withdrawal code. 

If you use an authenticator app, the attacker would need to obtain your phone to get the 2FA code, meaning that similar apps offer a stronger layer of defence than SMS. 

Withdraw your crypto 

Among the most effective ways to protect your cryptocurrencies is to withdraw them from the exchange. To do this, you have to download a wallet and set it up on your PC, then ask the exchange to send your assets to your new wallet address. A hacker can no longer steal your crypto by hacking the exchange or gaining access to your account once it is withdrawn; they’d have to compromise your PC to get your digital wealth. 

Prevention is always better than cure. When you enter the crypto world, ensure your digital wealth is safe by being wary of what you download, how strong your passwords are, and using a reputable cryptocurrency exchange.