Bitcoin's recent surge past its all-time high (ATH) has sparked excitement and a renewed focus on cryptocurrencies. It has also become essential to address the implications of this milestone and guide users on safeguarding their crypto assets. Keeping your private keys safe ensures your digital assets are also safeguarded.
When you own cryptocurrencies, you also own a "private key," like a secret code that lets you authorize transactions on the blockchain network. Anyone who knows this key can use your funds, so it's important to keep it safe,
If you lose your private keys or keep them on a device that breaks, no one can help you get them back. No banks or institutions can replace them, and you'll lose access to your cryptocurrency. So make sure you keep your private keys safe and backed up!
Where and how to store Bitcoin and other crypto
When you own your private keys, you have more control and power over your assets. However, it also means that you are responsible for their security. There are tools to manage your keys, commonly known as "crypto wallets," but not all are secure. There are four types of wallets that you can use to manage your assets:
Hardware wallets
Hardware wallets, like Tangem Wallet, are widely considered the most secure option for storing your cryptocurrencies. Storing your private keys offline is the main function of a hardware wallet. This ensures that only you can access them and eliminates the possibility of digital exploits on your wallet. Hackers cannot access the device or the private keys stored inside it, which makes it a secure way to store cryptocurrency. With a hardware wallet, even if a hacker gains control of your smartphone, it'll be impossible to steal your private keys and crypto assets. Keeping your private key offline greatly reduces the risk of hacking.
In summary, if you want to ensure the safety of your crypto, hardware wallets are the way to go.
Software wallets
Software or online wallets help you manage cryptocurrencies quickly. You can install them on your computer or phone. With a software wallet, you control your private keys and don't need to share them with anyone else. Online wallets are convenient because you can access them from any device with an internet connection. However, software wallets are still connected to the internet, which can make them vulnerable to hackers. Even if your private key seems hidden, someone could have accessed it through your connection. This is not what you want from a crypto wallet.
Exchange wallets
Most people start using cryptocurrency by buying it on an exchange platform and leaving it there, particularly if they plan to keep trading. However, a significant concern with using an exchange wallet is ownership; you will never have control over the private keys of your assets on this type of wallet. Instead, you must rely on a third party (the exchange) to handle these private keys and act as a safeguard, essentially trusting a stranger with your funds. This approach has several issues.
Exchanges have vulnerabilities that hackers can exploit. Although exchanges put some security measures in place, most do not specialize in security. As a result, you trust them with the responsibility of keeping your private keys safe, using whatever methods they deem appropriate. If a hack happens, your funds are at risk of being stolen. The increasing number of high-profile hacks on significant crypto exchange platforms and the constant news of individual crypto attacks make it clear that every crypto investor should prioritize security regardless of the size of their assets.
You have to rely on the exchange platform to not engage in malicious activities with your assets or mishandle them. In either scenario, you could lose your crypto since it does not technically belong to you while it's in the exchange wallet. Exchange wallets can be useful for trading and ease the burden of managing your private keys. Still, they come with a significant cost - relinquishing control of your crypto.
Other tips for keeping your bitcoin safe in a bull season
1. Review your security measures
With the increased value of Bitcoin, the importance of robust security measures cannot be overstated. Ensure your wallet is well-protected with features such as two-factor authentication (2FA) and strong, unique passwords. Consider hardware wallets like Tangem for an extra layer of offline security.
2. Stay informed on updates
Cryptocurrency landscapes are ever-evolving, and so are potential security threats. Keep abreast of updates and patches for your wallet software. Regularly check for firmware updates on hardware wallets to stay protected against emerging vulnerabilities.
3. Diversify your storage solutions
Consider diversifying your storage solutions. While hardware wallets provide excellent security for long-term storage, having a small portion of your crypto in easily accessible wallets or exchanges for liquidity might be prudent. Strike a balance between security and accessibility based on your usage patterns.
4. Implement cold storage
Cold storage solutions, like hardware wallets, keep your private keys offline, significantly reducing the risk of hacking. Tangem's cold Wallet offers a user-friendly and secure way to store your Bitcoin and other cryptocurrencies.
5. Backup your recovery phrases
Ensure you have securely backed up your recovery phrases or seed words in multiple locations. This is crucial for regaining access to your funds in case of device loss or failure. Store these backups in physically secure places, considering the sensitivity of the information.
Conclusion
As Bitcoin reaches new heights, the security of your crypto assets becomes paramount. By adopting a proactive approach and implementing robust security measures, you can enjoy the benefits of this digital revolution with confidence. Tangem's commitment to secure and user-friendly solutions aligns with these principles, providing a reliable option to safeguard your crypto asset. Stay informed, stay secure, and confidently navigate the evolving crypto industry.