7 Ways to Make Your Digital Wallet More Secure
Coincover has some top tips for keeping your crypto safe. Seven, in fact. So read on to find out how to keep your digital currency secure.
When it comes to keeping your digital wallet secure, you can’t be too careful. Although the recommended level of security you should employ might appear to be bordering on paranoid, there’s a very good reason for this.
When you keep fiat currency in a bank, there are certain safeguards protecting your money. If the bank gets hacked, as holder of your money it will assume responsibility. And if fraudulent transactions are made (or even if transactions are made in error), they can be reversed.
With cryptocurrency, the responsibility is all yours. Proof of ownership is stored on the blockchain, and ownership is verified with a private key. If someone else gets hold of your private key, they could effectively take ownership of your currency. Or if you lose it there is usually no way of getting into your wallet and your currency will be lost.
So here are some essential steps for keeping your wallet secure, and your private key inaccessible to anybody who may wish to exploit it.
1. Tighten up your email security
One of the most common ways to fall foul of a scam is via a phishing email. Usually users are lured to a fake site where they’ll enter a password. These emails and sites can be very convincing, even to savvy internet users. This is why you should only open emails from trusted sources, and check security certificates of any website you’re directed to.
It’s always best to exercise sensible caution with emails, regardless of whether you have cryptocurrency. Be doubly cautious when emails concern your finances, and make sure that financial service providers are who they say they are before you part with any personal information.
2. Keep your devices clean
Keeping your devices malware-free is also essential if you have digital currency.
Don’t install any software that you know is a bit dodgy on your devices, such as torrent clients or anything that enables practices which could be legally questionable. Even legitimate software sometimes comes bundled with additional software and plug-ins, so don’t accept additional bundled software on install. If you’re in any doubt as to whether software is secure, don’t install it on the same device you use for your crypto trading.
And make sure you have a reputable antivirus program installed too, as well as a malware scanner.
3. Use two-factor authentication
Despite being a very standard security feature, passwords are actually problematic. People habitually create hackable passwords, forget them, use the same ones for multiple sites and accounts… They’re subideal, frankly.
This is why it’s smart to use two-factor authentication (2FA) where possible. This creates a fallback layer of security, which should hopefully keep hackers out if they gain access to your password. It’s becoming more commonplace for companies to use PINs and set security questions, although these may still be susceptible to security fatigue. Installing an authenticator app which produces a time-limited code unique to you is the standard among reputable wallet service providers (WSPs).
4. Be wary of public wifi
Public wifi is handy in lots of ways, but you should avoid connecting devices containing sensitive information. At best, the provider will be privy to the data you’re sending and receiving over the network. At worst, malicious software could be used to steal your information.
If you absolutely have to use public wifi, make sure you use a VPN to keep your data encrypted. And it should go without saying, but don’t use wifi you don’t trust to access your wallets.
5. Don’t store tokens on exchanges
Exchanges are an obvious target for hackers, and attacks are common. You’re far better off using a reputable Wallet Service Provider that offers cold storage. This is especially true if you’re thinking of your digital currency as an investment, and aren’t looking to trade that frequently.
Top tip: Getting a BitGo wallet means you have the option of protecting it with Coincover, the first service to guarantee that digital currency won’t be lost or stolen. This gives you the convenience of a hot wallet combined with the security of cold storage.
6. Keep your private key secure
On creation of your wallet, you’re provided with a unique key to download. A private key is a unique randomly generated 256-bit long alphanumeric password that enables you to transfer your crypto. So it’s critical that you take the utmost care of it. Don’t store the key using any of the following:
- Note-taking app
- Cloud storage, such as Google Drive or Dropbox
- In a file on your computer
Unless you have a photographic memory - which most of us don’t - you’re unlikely to remember the keycard in full yourself. Best practice is to download the key to an encrypted USB drive, printing out one hard copy and keeping it somewhere secure. If you want to keep a digital copy as backup, an encrypted USB stick that’s not kept plugged in is recommended. USB sticks can be lost and occasionally fail, so please make sure that this digital version isn’t your only copy of the keycard.
Top Tip: Use a multisig WSP for extra security. Whatever precautions you take you may still lose your key and in turn access to your funds. A multisig BitGo wallet with a third key held by Coincover removes this risk and allows you - or a member of your family should something happen to you - to recover your wallet without your key.
7. Get Coincover protection
Well, we were bound to say this, weren’t we? All the same, having a Coincover-protected wallet gives you the peace of mind of knowing that:
- Your digital currency is protected against theft or loss
- You have 24/7 wallet monitoring with early-warning alerts
- Your currency can be recovered if you lose your digital key