Dangers of Not Securing Your Digital Wallet Details

March 21, 2018 by Adrian Thorpe

As soon as you have made up your mind that you do wish to start using, investing in and buying and selling cryptocurrencies, then you need to ensure you are aware of the security aspects of doing so.

The one main thing that you are going to have to get for yourself, irrespective of just which cryptocurrency you have chosen to start using, is a digital wallet, and there are plenty of them that are compatible with different digital currencies.

I would urge you to be very wary of simply using a digital wallet that is part of any digital currency exchange, for there is always the risk when leaving your finds in a digital wallet linked up to a third party you could lose the cryptocurrencies you have in them if anything does happen to that digital currency exchange.

Therefore, you should select a digital wallet that is not held or controlled in any way by a third party, and ideally a digital wallet that is simply being used as the way to access digital assets that are held on a blockchain.

Jeep in mind though that some digital currency wallets are compatible with a range of different cryptocurrencies, and the obvious benefit of using such a wallet is that you can and will be able to store a wide and often very varied range of cryptocurrencies coins and tokens in those wallets, which will make getting access to hem much easier via one single log in of course.

Storing Log-In Details Offline

When you do active a new digital wallet you are going to be prompted to make note of a wide range of different log in details, and it is important that you physically write those details down and do not simply copy and paste them for example into a note pad file and store them on your computer.

If you were to simply store them on your computer then if anything did happen to it, such as it being stolen or having a fatal break down then your funds held in your digital wallet will not be accessible and will be lost for ever.

Also, if you do store your log in details on your computer, fi that device was to ever get hacked you could lose the entire contents of your digital wallet, and there will be no way what so ever for you to retrieve those cryptocurrencies.

So, make sure you do write down things such as your digital wallet address, your private and public keys and the seed words that will allow you to restore your account if for any reason you need to gain access to your account form a different computer.

Obviously, you will need to store those details somewhere safe and where there is no risk of anyone else gaining access to them so choose where you store them carefully and put them somewhere you will remember where they are too of course!

Moving Your Cryptocurrencies Around

As there are going to be lots of different things you can buy using any digital currencies and plenty of service you can pay for or even thing you can invest in, you will need to also ensure that you are never going to get ripped off when moving your cryptocurrencies around.

Therefore, you must treat them as cash always, and make sure for example when you are transferring any coins or tokens or cryptocurrencies to any other digital wallet you have the correct digital address for that wallet, of there is the chance you could send them to someone else by mistake and never get them back.

There are also going to be risks if you intend to use your cryptocurrency holdings to buy into  initial coin offerings and token generation events for there is a constant stream of fraudulent and outright scam and dodgy one’s going live all the time, and sending cryptocurrencies via your digital wallet does not allow you to charge back those transactions which is something you can do when paying with a debit or credit card.

If you are not fully conversant with all of the security aspects of using a digital wallet, and buying selling and using cryptocurrencies, then you should make sure you are, long before you set about using and buying cryptocurrencies, if you don’t then there is going to be the very real chance that you will put your cryptocurrency holdings at risk which something you should never do.