Last Updated on 1 hour by cryptoevent

Crypto wallets are digital wallets used to store, send and receive cryptocurrencies like Bitcoin. They are similar in concept to a physical wallet – they store funds securely – but instead of storing cash or credit cards, they only exist online and store digital currencies.

There are many different types of crypto wallets, and each has its own pros and cons. Different wallets also have different security levels and features that you can use to ensure your funds are as safe as possible. Here are five tips for securing your crypto wallets in 2022:

1. Use a strong password and two-factor authentication (2FA)

As with any other online account, it is important to use a strong and unique password for your crypto wallet. It should be a strong password at least 8 characters long and contain a mix of upper and lower case letters, numbers and symbols.

In addition to a strong password, you should also enable two-factor authentication (2FA) on your crypto wallet. 2FA adds an extra layer of security by requiring you to enter a code from your phone or other device in addition to your regular password. With 2FA enabled, you must provide both your password and a one-time code generated by an app on your phone to access your account.

2. Hardware wallets are the way to go

If you are serious about protecting your cryptos, you should also consider using a hardware wallet – they are offline and this serves an important purpose.

As physical devices, hardware wallets store your private keys offline, meaning your coins are safe even if your computer is hacked or infected with malware. Using a hardware wallet is not only a great practice when it comes to investments, but also when it comes to security. Hardware wallets are the most secure way to store your private keys and therefore your cryptos. They became popular after the Mt. Gox hack when hundreds of thousands of Bitcoin were stolen from the online exchange.

Ledger and Trezor are two of the most popular hardware wallets out there.

3. Backup your wallet

Keeping private keys offline means hackers can’t gain access across networks to get to them – and then your crypto wallet. However, it is important to ensure that the key is secured – if something happens to it, you will lose access to your wallet and any funds in the account. To avoid this, you should make sure you have a backup copy of the private keys stored in a safe place. This protects your wallet in an emergency.

4. Beware of phishing scams

Phishing scams are a dime a dozen in the crypto world. These scams usually come in the form of a text message, email, social media message, or even a phone call. In the scams, a person poses as a reputable figure or organization to try to gain access to your private keys. Phishing scams have grown in popularity in recent years; With the rise of crypto adoption, malicious entities have risen.

Some of the most popular phishing scam methods are:

• Creating a fake website that looks identical to a legitimate crypto exchange or wallet provider. Once you enter your credentials on the fake website, the hacker gets access to your account.
• By using malicious links or attachments. These can often be difficult to spot as they appear to come from a legitimate source. Be careful when clicking on links, even if they appear to be from a trusted site or person.
• Creating a fake mobile app that looks like a legitimate crypto wallet provider. Once you enter your credentials, the hacker will have access to your account.

The best way to combat these scams is to be vigilant and always double check the authenticity of every message you receive before taking any action. To avoid becoming a victim of a phishing scam, carefully read the URL of the website you are on before entering any sensitive information.

A good rule of thumb is to never click on links sent to you via email or social media unless you are absolutely sure they are legitimate. If in doubt, contact the organization or person directly through the official channels to confirm the validity of the message.

5. Avoid storing a large portion of your crypto on exchanges

Storing crypto assets on exchanges is a staple, especially among crypto newbies. After all, it’s much easier to buy, sell, and trade crypto when it’s stored on an exchange. However, this convenience comes at a price, as exchanges have been known to be hacked in the past.

Although most reputable exchanges have implemented robust security measures to protect their users’ assets, it is still not advisable to store a large portion of crypto on these wallets. If you must, save only an amount that you are happy to lose on the exchange wallets. Aside from exchanges being hacked, one risk is that your crypto could be at risk if the company running the platform is subject to law enforcement regulations. This is what happened to popular exchange Mt. Gox in 2014 when it was shut down by the US government. Many users of the platform lost access to their crypto wallets and were unable to retrieve their funds.

Why buy a crypto wallet?

Cryptocurrency wallets are essential for anyone looking to own or trade cryptocurrency. With so many different types of wallets to choose from, it’s important to choose one that best suits your needs.

When it comes to security, always remember to never store your passwords or private keys on an exchange or online wallet. Finally, don’t forget to backup your wallets in case you lose access to them.

The 5 Tips for Securing Your Cryptocurrency Wallet post appeared first on Coin Insider.