Crypto wallets are a favorite target for cyber criminals and scammers everywhere. This is because fund transfers made with cryptocurrencies are almost impossible to track.
And because cryptos are such high value assets, this makes crypto wallets a low-risk, high reward target for cybercriminals.
So, the question is, how can you protect your coins and prevent them from being stolen by hackers.
How To Protect Your Crypto Wallet?
Here’s a selection of the 5 best ways you can protect your crypto wallet.
1. Keep an eye out for the latest scams and cyber attack trends
Hackers and scammers are constantly developing new ways to exploit weaknesses and trick their victims. That is why, according to Tezro, it is very important to invest in the safest crypto wallet available.
Staying up-to-date with the latest cybercrime trends is one of the most effective ways to stay safe. By remaining alert and constantly suspicious, you make it that much more difficult to become a victim.
2. Watch out for social engineering
Being aware of social engineering techniques is also especially important. Oftentimes, criminals will use social engineering to try and trick an individual into revealing sensitive information.
These range from pretending to be someone in authority or disguising themselves as staff from your crypto wallet.
Scammers will often use scare tactics to confuse and disorientate victims, thus making it easier to trick them. Keep the following rules in mind:
- The authorities or any financial institutions will never ask you for your password or any other sensitive information.
- Never transfer tokens to someone you don’t know.
- Always keep your seed phrase to yourself — never reveal it to anyone, even wallet support staff.
3. Take a look at the wallet provider’s past history
With so many crypto wallets available on the market, finding the right one can get overwhelming at times. A good way of assessing how reliable your wallet provider is by checking out its past security record.
Given how often hot wallets are targeted by criminals, it’s next to impossible to find one that hasn’t been hacked. This is why I recommend choosing a wallet that is upfront about security breaches.
Top wallet providers like Binance, Coinbase, and Gemini have a solid record of being open with their users. Whenever a security breach is detected, these companies notify users and keep them abreast of any changes.
This transparent approach helps you stay updated and minimizes the risk of the wallet collapsing or disappearing overnight.
4. Avoid performing transactions on public wi-fi
While free, public wi-fi is great, you should avoid using it at all costs. That’s because it’s a favorite target of hackers looking to perform man-in-the-middle attacks.
A compromised wi-fi connection allows hackers to steal and intercept data streamed. Meaning that if you happen to input your wallet password or other details, chances are the hacker can steal said data. And from here, use it to empty out your wallets and siphon funds out.
5. Invest in a cold wallet
Cold wallets are one of the best ways to protect your cryptocurrency by storing it offline. Unlike hot wallets, cold wallets do not require an internet connection, and this is what makes them inaccessible to hackers.
While cold wallets are not free-to-use, the protection they offer is undeniable. In fact, top crypto wallets often store the bulk of their holdings in offline storage for better security.
6. Change your passwords regularly
Regularly changing your passwords makes it harder for a hacker to access your crypto wallet. When you’re creating a password, make sure that it contains a capital letters, symbols, and numbers.
Also, avoid particularly obvious clues such as birth dates, social security numbers, or the names of loved ones. Some people choose to use random password generators, which use complex algorithms to come up with something that’s 100% unrelated to the user.
Cryptocurrencies are one of the most important fintech developments to come about in recent times. But if you intend to use them, keep the following in mind:
Cryptocurrencies are highly volatile. Because digital currencies are 100% unregulated and totally decentralized, there are often little-to-no regulations with regard to how they are being traded.
While this has allowed investors to enjoy phenomenal rates of return in the past, there are also a few problems that decentralization brings.
For one, this makes cryptos extremely volatile, and prices can often suddenly change with no warning. And you can just as easily go broke overnight when prices crash. This also makes cryptos highly vulnerable to market manipulation and sudden price changes.
I highly recommend that you first understand the risks involved with these assets before jumping in. As a rule of thumb, only invest what you’re prepared to lose.
Using cryptocurrencies may be illegal in your country. Remember: cryptos are not backed by any governments or financial institutions. Because of this, these coins are often not recognized as legal tender.
Some governments barely tolerate the usage of such assets, while others outlaw its use entirely. So, be sure to check with local regulations to ensure that you’re not breaking any laws using cryptocurrencies.