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Cryptocurrency’s global value is now over $160 billion . Growing from a movement on the fringes of the tech community, it’s now become a serious rival for the hard currencies of the world. And with all the economic instability these days, it’s no surprise there is now more investment in crypto than ever.
Unfortunately, though crypto-currency is safer by-design than traditional currency thanks to the blockchain and other tools, there are still plenty of criminals out there trying to part people from their precious coins. Like everywhere else in the world, they take advantage of inexperience and security vulnerabilities to rob their victims.
So, if you have billions in Bitcoin or just purchased your first Litecoin, take some time to review these essential cryptocurrency risk management strategies.
1. Account Security
Your account or wallet is the primary way you buy, sell, and manage crypto. Using registration keys and passcodes, you access these accounts.
All you need for access is a password. This can create all kinds of issues if a key is stolen or copies. Once funds are stolen, there’s no way to track it. And since the currency isn’t insured, there’s no way to get your money back.
Often enough, hackers leverage access to personal devices to break into account and change settings to block them out. Or sometimes, it can be as simple as losing the passcode. Either way, it’s a major risk.
2. Vulnerable Exchanges
Crypto exchanges are essential for the buying/selling of crypto. They truly are an indispensable part of the ecosystem. But since the industry is new, it can be hard to tell the difference between legitimate and illegitimate platforms.
The USI scam really opened up everybody’s eyes to how dangerous phony exchanges can be. Even if the platform is legitimate, it can still suffer a data breach that puts you at risk.
3. Hackers Capitalize on a Lack of Understanding
Imagine if you had never used a bank before, and you didn’t even have a very good idea of how even standart currency really works. This is the equivalent of many people who have just entered the world of crypto.
The world is complex, and even after large amounts of research, it can be difficult for non-coders to understand crypto, the blockchain, and everything else. This is doubly true since the crypto functions very differently from stock markets and hard currencies.
This lack of understanding is a risk in itself. But it also contributes to heightening the danger for everybody in the community.
4. Scams
Scams are everywhere in the crypto world. There are scam currencies, scam websites, emails, and more.
Even to those experienced in crypto, they can be hard to detect. OneCoin continues to be one such huge scandal. From the outside, everything about it looked excellent. The founder had a doctorate in international law, there were many tech community members in favor of it, and it
received widespread acclaim.
OneCoin raked in over $4 billion before people finally recognized it as a scam. To this day, some newbies in the community still think it’s the real deal.
How to Manage Risk and Secure Your Investments
A lot of people consider crypto to be a gold-rush type sector. This is far from the truth. Like any emerging trend, especially one that involves currency, it has some risk and a lot of opportunities.
It is such a promising technology and really is revolutionizing the world. But just as you keep your cash in the bank or a secure vault, you also need to safeguard your crypto.
Above all, you need a VPN . With a VPN, you hide your IP address and encrypt your internet connection making everything you do online much safer. It’s a good way to connect to exchange, manage your account, and generally enhance your digital safety.
If you do anything with crypto, then you need one enabled at all times. In addition, protect your accounts with unique, complex, and lengthy passwords. Keep them safe, too in somewhere like a password manager.
Finally, train yourself to recognize scams, particularly suspicious emails and websites. Hackers can create imitation versions of real crypto exchanges. Being proactive about the emails and messages you receive, and spotting fakes is the best way to avoid this trap.
Crypto is changing the world we live in. So, keep your investment safe and start integrating these strategies and tools into everything you do online now.
