You will need a cryptocurrency wallet to be able to store, send, and receive bitcoin However, this wallet is to be as secure as possible to avoid your funds being vulnerable to fraudsters or falling prey to online scammers.
Online scams are constantly on the rise and for digital currencies, there is an even higher risk of vulnerability. Ponzi schemes are the latest form of bitcoin fraud and in 2019, it was reported that cryptocurrency scams took more than $4 billion. In the past four years, scammers have stolen over $38 million worth of Bitcoin (BTC).
While these scams might be on the rise, you can take active steps in ensuring your wallet is secure, and here are a few tips to guide you:
1. Choose the Right Online Service
It is easier to get scammed when you use a digital wallet, which is what most people use today due to the improvement in technology. However, you can avoid being scammed by choosing the right online service. There are several exchanges and online wallets today to trade crypto, including the bitcoin system wallet but you must also take proper precautions to ensure the wallet is legit and you can trust that your funds are safe in it.
Key things to look out for include the reputation of the company behind the wallet, transparency, reviews from existing users so far, and most importantly, the security measures that are in place, including two-factor authentication.
2. Tight Security of Your Wallet
Wallet security involves several factors, including the app itself and the measures you take to ensure you keep your wallet safe. Start by ensuring that the wallet has two-factor authentication which you must enable, then take extra steps to ensure your funds aren’t vulnerable to fraudulent attacks.
This includes creating a strong password and storing it where no one or app can have access to it. Avoid using phone numbers, birth names, birthdays, and any other thing that frauds could easily figure out. You can go for an alphanumeric combination and store it somewhere safe for easy remembrance. If you’re fond of using the same password across several accounts, you might want to keep that of your bitcoin wallet unique.
Always keep your private key with you, as that is how anyone can have access to your account easily. The public key is for public use while the private key stays with you who owns the account.
If you have to make transactions, always crosscheck bitcoin addresses, so you don’t end up making a wrong transaction. Crypto transactions are irreversible, so you might want to be extra careful with that.
3. Backup Your Wallet
A backup of your crypto wallet can be the bridge between you and a technical failure that could make you lose all your money. Backup your entire wallet and not just your private keys and ensure you encrypt online backups to ensure they aren’t vulnerable to fraudulent attacks. Most importantly, ensure you do this regularly.
Online scams or fraudulent acts do not seem to be going away anytime soon but you can protect your money at all cost by securing your wallet with the tips shared here.