Keeping your Cryptocurrency coins safe

With cryptocurrency being more and more popular, securing your coins has become a hot topic. Cryptocurrency being decentralized has the one downfall that there isn’t another entity, a bank for instance, that can be held accountable if something happens to your money. A lot of the security of your investments falls to you, and is determined by the choices you make.

Layer of protection

According to an article in Forbes.com cryptocurrency has three layers: Coins or tokens, Exchanges and Wallets (hot or cold). The security of a coin or token is the biggest threat to security. If there is a flaw in the coin, that can be exploited, it won’t matter how good your wallet is. If the coin is centralized, it’s security is also weaker. The second biggest threat is the exchange sites where coin trading takes place. Some of these websites in the past have not had proper security measures in place, and millions of dollars have been stolen by hackers. Just this february, 2018, BitGrail claimed 195 million dollars were lost to hackers (http://fortune.com/2018/02/11/bitgrail-cryptocurrency-claims-hack/). The last layer of defense you have is your wallet. There are two kinds of wallets, hot or cold. A hot wallet is a wallet on an exchange site, or a website. A cold wallet is software, hardware or even can be a piece of paper. With a hot wallet, the wallet is on an exchange site, so all the problems stated with exchange sites earlier also applies here. Most exchange sites that offer wallets give you lengthy passwords to remember (Though I would always suggest writing that down or keeping that information elsewhere and not actually remembering it) A cold wallet gives you a bit more say in the security of your coins. Cold wallets are getting more advanced all the time and come in many forms, from a USB stick to engraving your private keys on a stainless steel card (as on https://cryptokeystack.com/). Keeping your computer’s security up to date also helps your cold wallet security. If it is hard for a hacker to attack your computer then it will be hard to get into your cold wallet.https://cdn.steemitimages.com/DQmcYfZymBth8EDoM7bMFHdUt4whYwjCHSGpePN5k1sRSj9/1.jpg

In conclusion

Both, hot and cold, wallets can keep your coins safe, and it is more a matter of preference. Do some research on the coins you would like to buy, as well as the exchange site you want to use. If there have been noted security flaws in either of those it is something to keep in mind. Just because there has been some hacker attacks in the past doesn’t mean you have to stop investing. Keep up to date on security news and technology.