5 Things You Should Know to Keep Your Crypto Assets Safe

5 Things You Should Know to Keep Your Crypto Assets Safe

The crypto industry is seen by many as a goldmine of easy wealth and the best that money can buy. But a deeper look paints a different picture of rug pulls, hacks, fraud, and self-inflicted implosions. As such, crypto investors must take the necessary steps to protect their investments.

From cold wallets to hot wallets and everything in between, here are the top five things every crypto investor should know to keep their crypto assets safe:

1. Understand Cold and Hot Wallets

Cold wallets and hot wallets are two sides of the same coin. Their job is to secure your crypto assets and allows you to transact seamlessly when you want to. 

Cold wallets are offline wallets. This means that they are not constantly under attack from hackers. Hot wallets, on the other hand, are always connected to the internet, making them an attractive target for cybercriminals.

There are various wallets to choose from. And the best crypto wallets to use are not hard to find or use.

2. Use Secure Wallets

Crypto assets should always be stored in a secure wallet, such as a hardware wallet. Hardware wallets are hand-held devices which are used for the safekeeping of cryptocurrencies away from the internet. They are considered to be the most secure way to store your crypto assets. When choosing a wallet, make sure to do your research and select one that is reliable and secure.

3. Keep Your Private Keys Safe

Your private key is a string of characters that gives you access to your crypto assets. It’s important to keep your private key safe and secure, as anyone with access to it can access your crypto funds. You should never share your private key with anyone, and you should store it in a secure location.

4. Use Two-Factor Authentication

Two-factor authentication (2FA) is an extra layer of security that adds a step to the process of logging into your crypto wallet. With 2FA, you have to enter a code from a mobile device or a physical token in addition to your username and password. This makes it more difficult for hackers to gain access to your wallet.

5. Be Aware of Common Crypto Scams

Unfortunately, crypto scams are all too common. Here are the five most common crypto scams, and how to avoid them:

  • • Phishing scams: Phishing scams occur when hackers create fake websites that look like the real thing to steal your personal information. To avoid phishing scams, make sure to only visit legitimate websites, double-check the URL, and never download suspicious attachments or click on links.
  • • Pump and dump schemes: Pump and dump schemes involve a group of people buying a cryptocurrency at the same time to artificially inflate its price. To avoid being scammed, never invest in a cryptocurrency that is being hyped up by a group of people.
  • • Ponzi schemes: Ponzi schemes involve an individual or group of people promising high returns on investment while using the funds to pay earlier investors. To avoid Ponzi schemes, never invest in cryptocurrencies that promise high returns with little risk.
  • • Fake ICOs: Fake initial coin offerings (ICOs) are created by scammers to steal funds from unsuspecting investors. To avoid fake ICOs, always do your research and make sure to only invest in legitimate projects.
  • • Fake wallets: Fake wallet scams occur when hackers create fake wallets to steal cryptocurrencies. To avoid fake wallets, only download wallets from official sources, double-check the URL, and never download suspicious attachments.

Be careful of these malicious activities that rob you of your digital assets. You also have to be wary of the tax implications of losing money in crypto scams.

Stay Safe, Always

Keeping your crypto assets safe is essential for any crypto investor. You can ensure that your crypto assets are safe and secure by understanding cold and hot wallets, using secure wallets, keeping your private keys safe, using two-factor authentication, and being aware of common crypto scams.