How to not lose your cryptocurrency

Image for post
Image for post

The potential problems with exchanges

If we want to learn how best to keep our cryptocurrency safe, then the first step is to understand how investors have lost their coins to theft or fraud or misplacement. Cryptocurrency has only officially been around since 2009, but we already have some examples that should help us better understand how to protect our investments.

Understanding public and private keys

Every wallet has two kinds of keys. One is your public key. This is the ‘address’ you can email to people or the QR code in your wallet app that you can show to other people so you can receive cryptocurrency into your wallet. Your public key does not allow people to withdraw currency from your wallet. If you want to send cryptocurrency to someone else, they will have to send you their own public key or let you scan their QR code.

Should you be scared of buying cryptocurrency?

I don’t think so. Until six years ago I operated a fin-tech company that combined customer financial data with securities prices to create online accessible financial analysis reports. Sometimes new customer would ask if I thought it was risky to have investor data stored in ‘the cloud’, I would always reply – “Nothing is 100% safe, but our platform is safer than the paper files you have in your office.”

Some basic rules to keep your cryptocurrency safe

Rule number 1 – If you aren’t actually trading your cryptocurrency, get in the habit of moving your money to a wallet in which you control the private keys.

Use common sense when handling cryptocurrency

Hot wallets, cold wallets, online, offline – it all sounds like a lot of information and you might be confused about how much security is right for you. So let’s go over a list of common sense suggestions we can use and modify to suit your personal financial situation.

Written by

Edward Iftody is a Communication Coach, author of Surviving Work, a veteran of the Canadian fin-tech industry and a blockchain enthusiast.

Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store