The main attraction amongst investors for investing in cryptocurrencies through exchanges like Bitcoin Code was because these were decentralized and not regulated by third parties like banks or financial institutions. Bitcoin, which made its first appearance in 2009, slowly ascended to the highest levels of popularity because of its digitalized nature, decentralized system and high prices. But, at the same time, it caught the attention of miscreants and soon became the target of cyber thieves and hackers. Regardless of how technologically savvy you are, your Bitcoins are vulnerable and you need to follow some effective tips to make sure they stay secure and private:
- It is a fact that nearly everything that you have online can be safeguarded from prying eyes and unauthorized access with a carefully-worded password. You must also keep changing the password every few months. For additional protection, it is better to choose dual-factor authentication which implies that you have another key piece of information besides the password, like a code to be sent to your phone, before you can log in.
- If you store your Bitcoins offline it is a cold storage wallet. These are not linked to the Internet and therefore less prone to hacking. So, it is best to reserve a few Bitcoins for daily trading in an online wallet and the remaining in a cold storage wallet.
- You need to back up the wallet from time to time. When there is a hardware problem this history of routine backups will be the only way to get back the money in your digital wallet. Besides backing up the wallet files, these should ideally be stored in multiple places and password-protected.
- The software needs to be updated routinely. When a wallet runs on outdated software hackers can target it easily. Latest software versions will have advanced security systems and this in turn keeps your Bitcoins secure.
- Encryption helps to add an extra layer of security for your file, folder, or messages so that these cannot be accessed by people who do not have authorization. When you are using a hardware, mobile, or desktop wallet, this encryption is very important to save the data from online criminals. No simply should your password be a mix of letters, special character and numbers, these must be either memorized or stored in secure locations because password-recovery mechanism is extremely weak in case of crypto coins like the Bitcoin.
- It is best not to access your wallet from public computers. Even if you may need to access funds right away you should never use a public machine which many others have used during the day. Instead, you must only use your own laptop or personal computer and ensure that the account is well-protected with password and you have advanced malware protection.
- When multi-signature has been enabled, users have access to more than one wallet key for processing a transaction. This is similar to dual-factor authentication, and it implies that even if the hacker manages to get your private key, he will need an extra key to conduct the transaction successfully.