It is very easy to lose your Bitcoin and unfortunately, Bitcoin is a major target for hackers. You probably worked very hard to get your Bitcoin, so it is worth taking a few simple steps to ensure that you protect it so you can hold onto it.
Encrypt your wallet
Whether your wallet is your own crypto wallet, or via a third-party website, always ensure that you have
Make sure you can easily remember the password for years to come.
If you are using an established hardware wallet such as a Trezor or Ledger, you will be walked through best security practices when you set up the device.
If you are using a third-party service such as an exchange, always use two-factor authentication (2FA). If the website does not offer this function when you sign up, you should probably question whether storing funds on their site is a good idea. This is especially true considering the fact that you can easily just sign up for a site like Coinbase or Gemini, where you can definitely get 2FA protection.
Two-factor authentication acts as another layer of security that makes it harder for hackers to access your account.
How to use Two-Factor Authentication (2FA) for extra security:
- Download the free authenticator app such as Google Authenticator or Authy on your mobile phone.
- Login to your exchange.
- Go to the security settings and select “Two-Factor Authentication”. The exchange will show you a QR code.
- Open the authenticator app on your phone to scan the given QR code.
- Once you’ve successfully linked your exchange with the authenticator app, it will automatically generate a 6-digit code every 30 seconds.
- This is your 2FA verification code that you will need to enter when you log in to your exchange or wallet.
- Enter the code and press Verify Code.
Never share your private keys
Private keys are the code that allows you to move your coins, sign off transactions and generally manage your funds. It is very important that you do not share your private keys with anybody. Keep them somewhere safe that only you can access. If someone has your private keys, they can take all of your funds.
Do not keep your private keys on any online device that can potentially be accessed by hackers or via malware.
If you have control over your private keys, then you have control over your coins. If you do not have control over your private keys, then you do not have control over your coins.
The major hardware wallets such as Trezor and Ledger allow you to generate your own private keys in a very simple way, and store them securely. This is extremely convenient, and it is also good for security.
Backup your wallet
When you set up a hardware wallet such as a Trezor or Ledger, you will be asked to write down a recovery phrase.
This is important should your wallet ever be damaged, lost or stolen. You will still be able to access your funds by inputting your recovery phrase onto a new device.
Once you write down the series of words presented to you by the device, you will then need to store them offline, in a safe place. Do not keep a record of them on your phone or computer.
You can store the recovery phrase in a safe in your home, or in another secure location. Wherever you store it, just make sure that it is both secure, and accessible to you. If you do end up losing your wallet, you will want to be able to access the recovery phrase quickly in order to preserve your coins and prevent them from being stolen.
Update your wallet software
Always make sure you install the latest software updates for your Bitcoin wallet to ensure that your wallet is not vulnerable to bugs or attacks. The wallet companies periodically upgrade their software to account for new developments and positive changes. By installing these software updates, you can benefit from these changes and upgrades.
If you make sure that you update your wallet software regularly, it will also ensure your wallet has the latest features and best functionality.