Register to chat with like-minded investors on our interactive forums.
3 Reasons to Keep Funds in a Crypto Wallet
The issue of keeping money has always caused a lot of controversies. Gone are the days when people kept money in a safe at home. Also, cash payments are gradually leaving the market due to their inconvenience. They are replaced by non-cash payments – using a bank card or online wallet.
Most of the planet’s inhabitants claim that they keep most of their income on cards because they believe banks provide strong protection for customer data. But is it really so? We found the principal risks of storing money on a card and provided three benefits of keeping money in a crypto wallet.
Risks of Keeping Money on a Bank Card
Financial security experts warn that it is not worth keeping large amounts on the card, as they are more susceptible to hacking than accounts on crypto wallets. When using cards in online purchases or outlets, card payment data (card number, CVV code, PIN code) can be easily spied on by fraudsters, who have almost no difficulty debiting available amounts. Returning the money stolen in such ways is subsequently quite tricky because the cardholder will have to prove to the bank that it was not his fault that the funds were debited. However, these are far from the only risks.
The main dangers of storing large amounts on the card:
- Bank cards are constantly used and may become known to unauthorized persons.
- When connected to free Wi-Fi, your bank cards, financial transactions, and personal data become visible to people connected to the same network.
- The card has a physical form so that it can be stolen.
- If a card with a large amount of money is hacked, the losses will be significant.
- It is difficult for a bank to prove that the money was debited without the malicious intent of the cardholder.
Now banks offer a card protection service in the form of insurance. The risks will include fraudulent activities, attacks at an ATM, card theft, etc. If an insured event occurs, the insurance company promises to pay the amount specified in the contract. However, the insurance companies are so insidious that it is impossible to get a refund. Crypto wallets are an excellent alternative to bank cards, and we found three facts confirming this.
3 Benefits of Crypto Wallets
Before we get to the main topic of our article, let’s find out what a cryptocurrency wallet means. A crypto wallet is a special high-tech program that makes it possible to receive, send and store cryptocurrency. Why is a crypto wallet much safer than a bank card? Why is cryptocurrency more secure than traditional money? You will find answers to these questions below.
Highly Secure Blockchain
The central monetary units of any cryptocurrency are lines of computer code. Cryptocurrency authors encrypt this code to manage electronic money and protect it from counterfeiting. The code for each currency is stored in multiple copies of a programmable digital ledger, a blockchain that runs on hundreds and thousands of individual computers. The common name of monetary units is tokens, and the top of the most common cryptocurrencies are Bitcoin, Ethereum, Ripple, Bitcoin Cash, and Cardano.
Blockchain software is a bank vault that stores tokens and a ledger with transaction records. Blockchain is a series of records containing data and links, with the help of which each block is linked to the previous one. It is a distributed software system, meaning that exact copies of the blockchain software and its data are located on many computers connected through a peer-to-peer network.
All computers in this network use a consensus algorithm to confirm the registration of verified transactions and verify new transactions on the blockchain. In other words, to steal tokens or modify the distributed ledger in another way, cybercriminals will have to infect hundreds of thousands of computers on the network at the same time. Decentralization and encryption protect secret information and cryptocurrencies from hacking.
Ability to Connect to VPN
Despite improvements in security in the crypto industry, there are still many risks and issues associated with hacking and anonymity. When entering cryptocurrency exchange transactions, you most likely want to remain anonymous. Fortunately, cryptocurrency platforms allow users to connect to VPNs, unlike banking apps, which block entirely access to finances when customers use this tool.
VPN allows you to trade on the cryptocurrency exchange with complete confidence in your safety. The tool encrypts your connection so that hackers or your ISP cannot track your traffic. This is very important to know for your specific needs and you can read more about the many benefits for your needs on the blog. A VPN also hides your IP address – this makes it impossible to trace the connection between your personal information and the history of your actions on the Internet.
As for Android and iPhone VPN settings, it is pretty simple: download a verified VPN on your device; register in the system; connect to any available server. Then you can enjoy safer web browsing and cryptocurrency exchange.
No Malware In Tokens
Unlike banking apps, it is impossible to hide malware in tokens. To infect tokens, a hacker would have to inject malicious code into blockchain software updates, hack the consensus algorithm that governs transactions, or even issue their cryptocurrency with pre-compromised tokens.
These actions will require hackers a lot of time and resources. In other words, such a powerful invasion can cost significantly more than the profit they can make from your crypto wallets. Thus, the introduction of malware into tokens is unlikely, reinforcing the high security of cryptocurrency exchanges.
