Bitcoin is a peer-to-peer digital currency that removes the middleman between you and your money. This means that you have the freedom to send money anywhere in the world without intermediaries–– and the responsibility to protect your assets.
The team here at Bitcoin.com has developed a range of tools and resources to help you keep your digital assets safe. Let’s take a look at the different ways you can secure your Bitcoins.
Cryptocurrencies accomplish the same functions that traditional currencies have always performed while removing third parties and middlemen between you and your money. Whether acting as a fast and convenient method of payment like Bitcoin Cash, or a great store of value, like Bitcoin, cryptocurrencies put you in total control of your finances.
Just like you wouldn’t leave your gold or physical cash vulnerable to theft, you need to be proactive in securing your cryptocurrency as well.
One of the most important decisions you’ll make about managing your digital assets is how you are going to store and secure them.
Here are a few ways you can store your cryptocurrency:
A custodial wallet is a wallet where a third party controls access to your coins. An example of this type of wallet would be your account on a cryptocurrency exchange, or trading platform.
This is one of the least secure places to store your cryptocurrency, because exchanges and trading platforms are managed by third party companies which can be targeted by hackers and nefarious actors either internally or externally.
Instead of leaving your precious assets in the custody of a third party, we highly recommend that you store your cryptocurrency in a non-custodial wallet– a wallet that you and only you can access.
The Bitcoin.com Wallet is just that– an easy-to-use interface that grants you exclusive control over your digital assets. Now with the ability to back up your wallet to your Google Drive and iCloud accounts, you can rest assured that your assets are secure, even in the event that you lose your device.
We highly recommend taking advantage of cloud backups, as this
To learn more about backing up your wallet, check out our step-by-step guide here.
If you’d prefer to store your coins in a physical location away from the internet, then a hardware wallet may be the right choice for you. A hardware wallet is a physical drive that stays offline in order to provide greater security and exclusive access to your assets.
When you connect to your wallet to send or receive Bitcoin, you’ll be prompted to back it up in case you ever lose access. This backup involves recording a series of words called a recovery seed. In the event that your hardware wallet becomes lost, stolen, or damaged, you’ll be able to regain access to your digital assets using your recovery seed.
Since this recovery seed is your exclusive access to your assets in the event that your drive becomes compromised, we recommend recording this phrase on a material more durable than paper, such as having it etched in metal.
Much like a hardware wallet, a paper wallet is another option for you to store your assets in a physical location away from the internet. While a hardware wallet functions similar to an offline harddrive with your coins stored digitally, a paper wallet can be generated quickly with a single piece of paper and a printer.
A paper wallet consists of two QR codes– one code for making deposits, and another which stores the private key. A simple scan of the deposit code lets you add as much Bitcoin as you’d like to your wallet. When it’s time to withdraw your assets, simply scan the private key and retrieve the contents from the wallet.
Because anyone with access to the private key can withdraw the contents of the wallet, paper wallets need to be stored in a secure location, such as a safe or lockbox. As paper can be vulnerable to natural disasters such as fire and flood, some people elect to use this same concept to store their assets on a durable metal which can withstand such instances.
You can learn more about cold storage and generate your own paper wallet by visiting paperwallet.bitcoin.com
By now, you should have a good idea of the freedom and responsibility that comes with owning cryptocurrency. Remember that these digital assets function the same as the fiat currencies and financial instruments that you’ve used in the past, so please take the necessary precautions when protecting your assets.
Never share your wallet recovery seed or any cryptocurrency-related passwords with anyone.
When using a crypto currency exchange, choose a unique password and change it regularly to prevent unauthorized access. Most exchanges offer two-factor authentication, so be sure to enable this for added security.
If you receive any suspicious emails, delete them immediately and never click on any links or images, as these may be phishing attempts at retrieving your passwords. Instead, it is always best to visit sites involving your digital assets directly from your browser.
If you’re ready to take total control of your finances, you can get started with Bitcoin today by downloading The Bitcoin.com Wallet.