How To Hold Cryptocurrency Safely, With Ledger

Welcome to the third guide in a series of four that have been written and produced in partnership with Ledger. These guides will lay out the things you should consider as you enter the world of cryptocurrency investing – including how to buy and store your crypto and, importantly, how to safely take action today.

This guide will focus on how to hold your cryptocurrency safely – including the best storage solutions and a checklist to avoid common pitfalls. If you missed the first and second parts of this series, check them out below.

Part 1️⃣: An Introduction to Cryptocurrency

Part 2️⃣: Storing Cryptocurrency: Digital vs Hardware Wallets

Part 4️⃣: The Most Popular Cryptocurrencies

What’s the best wallet to store cryptocurrency safely?

Using a hardware wallet – sometimes called “cold storage” – is widely accepted as the most secure method for storing cryptocurrency. It’s backed by security experts and keeps your private keys offline – so your crypto is inaccessible to anyone but the holder of specific access codes.

As you’ll recall from part two of this series, hardware wallets work by generating a set of private keys, which you ought to keep safely offline. The wallet itself is secured by a 4-to-8-digit PIN – and the device will erase after several failed access attempts, preventing physical theft.

It’s worth noting that not all hardware wallets are the same. The precise level of security you get from a hardware wallet will depend on its features, so it’s worth digging into your provider to make sure that you’re comfortable with the level of security and control on offer.

A few things to look for in a quality hardware wallet:

• A recovery phrase: This is a code (up to 24 words) that stores all the information needed to recover your wallet. If your hardware wallet is lost, stolen, or damaged, you haven’t necessarily lost access to your crypto: a recovery phrase will let you get to your coins, via a digital wallet or a new hardware wallet.
• A PIN
• Security level: By now, you’ll appreciate the importance of security, so look out for a high-quality security chip in your wallet – ideally one that’s certified as such.
• Ease of use: You’ll naturally want a hardware wallet that’s easy to use, offers direct control over your crypto, and gives you broad access to the crypto services you’re after.

How to be safe when storing cryptocurrency?

Information security is a hot topic encompassing everything you do online – from social media to emails, usernames, and passwords. There are several best practices for any kind of information security – and they’re of paramount importance for safely storing cryptocurrencies.

Regardless of which method you use to store your crypto…

• Use two-factor authentication (2FA) on all accounts. Don’t rely solely on SMS verification – your phone number can be ported to another device.
• Store sensitive information (such as your recovery phrase) in a secure offline location, like a safety deposit box.
• Use a password manager and/or different passwords for different sites.
• Make sure your email accounts are secure – especially your linked “forgot-my-password” backup accounts.

All of these security practices are meaningless, though, if you get tricked into giving up the goods willingly.

Social engineering

Social engineering is when you’re tricked into exposing personal information that allows a hacker to steal your identity. This could be your email address, your phone number, or anything else that can be used to prove you’re you. A successful hacker can pretend to be you, reset your passwords, and log in to your accounts to steal your funds.

Phishing attacks

Hackers are also famed for their “phishing attacks”. That’s where they get you to enter your password or private key on a fake version of a real website. To avoid falling victim, always check URLs to make sure you’re on the correct site. And keep your software – especially anything crypto-related, like that of your hardware wallet – up to date.

That’s a wrap for now! You’re officially au fait on the best way to store your crypto safely. Check out the fourth and final part of this series for more.

Part 4️⃣: Introduction To The Most Popular Cryptocurrencies

This guide was produced in partnership with *Ledger**.*

Check out Ledger’s mini-website at finimize.com.