crypto safely store

How to store cryptocurrency safely

Trading digital assets comes with the task of properly storing them in a safe place. This is why it’s every crypto trader’s priority to protect their digital assets.

Whether you’re a first-time or a long-time trader in the crypto market, everyone needs to take the necessary steps in storing funds properly. This will also ensure your digital assets’ security and lower the chances of them getting hacked or stolen.

Keep reading to learn more about it where and how you can store cryptocurrency safely!

Where can you store cryptocurrency?

Storing cryptocurrency is easy because all you need is a crypto wallet. With it, you can store and keep your digital assets safe. This can come in the form of a hot or cold crypto wallet.

Crypto wallets have a unique wallet address that is available for public viewing. The address linked to your wallet is similar to that of a bank account number. Whenever someone needs to transfer funds to your account, they need your wallet address to do so.

A crypto wallet also has public and private keys. Public keys are connected to your wallet address and feature a hashed function to protect your wallet. Private keys are composed of a series of numbers and letters, that work to protect your account and keep your digital assets safe.

Types of crypto wallets

There are two main types of crypto wallets: hot and cold. Hot wallets are connected to the internet and can be accessed whenever you want whereas cold wallets are stored offline using physical devices.

To learn more about this and the other kinds of crypto wallets, continue reading below:

Online crypto wallet

One way to store your digital assets is through an online crypto wallet that is external from crypto exchange sites. Programs like Exodus or Mycelium can be accessed on your desktop or phone and can serve as a great way to store cryptocurrencies online.

As the market develops, so do platforms such as crypto wallets. Many have gone through hacking attacks and other incidents but with the online crypto wallets, they have improved their security systems. Before signing up for an online crypto wallet, make sure to do your research on the most reliable platforms available before entrusting them with your digital assets.

Hardware wallet

If you want to go for the best and safest way to store cryptocurrency, then a hardware wallet is the best way to go. This type of cold wallet looks like a USB flash drive that you can access by plugging it into a device. Best for long-term storage and investing, hardware wallets keep your digital assets secure and away from the internet where there is a possibility to be hacked. Some of the most popular options include Ledger and Trezor.

Paper wallets

Another way of storing cryptocurrency offline is through a paper wallet. This is also a type of cold wallet and works by printing all of the necessary information like private and public keys or QR codes on paper. The only thing you have to do is keep that piece of paper safe at all costs.

Cold wallets in general are best for those who are HODLing or looking for long term investments. If you want to make sure that your digital assets stay safe and away from hackers, then physical wallets are the way to go.

Cryptocurrency exchange platforms

One way you can store cryptocurrency is through an exchange platform. Some crypto exchanges such as Coinbase and Binance have a built-in wallet feature that enables users to directly store traded digital assets.

When you choose to store your cryptocurrencies this way, your funds will be partially managed by the platform. For example, custodial wallets are commonly used in crypto exchanges. These are wallets where your private keys are stored by a third party, which is usually the crypto exchange being used.

Financial applications

You can also opt for financial applications instead of exchange sites for a crypto wallet. When keeping digital assets this way, your private key will also be controlled by the app.

Before signing up, remember to check the app’s rules and regulations to make sure it’s suited to your trading behaviour and preferences. For example, if you store cryptocurrencies in PayPal, you can only withdraw or deposit them in PayPal accounts.

Some examples of financial applications that support crypto wallets are Robinhood and Paypal. You can buy and sell cryptocurrencies freely on their platforms and explore the application’s features as well.

Tips to store cryptocurrency safely

When it comes to storing your digital assets safely, it’s important that you take the necessary steps to ensure that all goes well. To learn more, take a look at some tips on how to store cryptocurrency safely:

Don’t store all of your digital assets in one wallet

Make sure you keep your digital assets in different crypto wallets. You can try using a crypto exchange, an online wallet, or a cold wallet all at the same time! This way, your funds are well-distributed and protected from hackers and other threats.

Don’t forget necessary security measures

One way to keep your funds secure is through a two-factor authentication, which can be linked to your phone number, email, or fingerprint.

Before allowing access to your accounts, you will be asked to enter a one-time PIN or verify that you’re trying to log in first. Make sure to change your password frequently and that you’re using strong, undecipherable combinations.

Do your research and use reliable platforms

Before using any kind of crypto wallet, read the reviews and see if it’s a good choice for you. Moreover, make sure you’re using reputable wallets to decrease your chances of getting hacked or experiencing any problems.

Don’t fall victim to phishing scams

One of the reasons crypto wallets are hacked is because of phishing scams that can grant hackers access to your account. They may lure you with an instant payout or get rich quick schemes to catch your attention.

These are situations where you could receive a pop-up ad on your laptop or a text on your phone asking for personal information. Remember to never give any sensitive data online, and immediately block or delete these messages as soon as you get them.

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