If you’re buying crypto this 2023, you’re not alone; 40% of 40,000 poll participants have the same plans. That’s despite the market capitalization of cryptocurrencies plunging the year before.
One reason for that interest is that cryptocurrencies have high return potential. This is especially true for Bitcoin, the first-ever crypto with the largest market cap. As of May 2023, its total market cap sits at a staggering $528.7 billion.
Another reason is that most cryptocurrencies offer a long-term store of value. This is due to their inflation-resistant nature.
But unless you know how to store Bitcoin safely, you risk losing access to your tokens and all their value.
Fortunately, you’ve come to the right place. We’ll share the top safety tips for storing Bitcoin and other crypto, so read on.
For those keeping an eye on other cryptocurrencies, it’s useful to monitor various exchange rates, such as the xrp aud price, which provides insight into the value of Ripple against the Australian dollar.
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Use a Hardware Wallet
Cryptocurrencies exist on the blockchain. However, owned tokens are only accessible through crypto wallets.
Think of crypto wallets as the mechanism that allows you to see your digital assets. This tool lets you buy, sell, or receive Bitcoin and other cryptocurrencies.
Your crypto wallet comes with two types of keys: a public key and a private key. Your public key is like your wallet account’s address, which you can share with others. Your private key is a code that authorizes transactions you make, such as when you send or sell crypto.
Since your wallet keeps your private key, you must ensure its safety and security. This is where cold hardware wallets excel; they’re among the most secure as they’re offline.
A hardware wallet is a physical device, like a USB, S.D. memory card, or Bluetooth device. It’s a “cold” wallet because it doesn’t always have to be online. By contrast, a digital wallet is hot because it lives online.
Since you can keep a hardware wallet offline, it can be less of a target for cybercriminals.
Another feature that makes a hardware wallet secure is that it’s non-custodial. This means that no one else except you can manage the device.
But before buying a hardware wallet, check its security features first. It should have at least two security methods: a PIN code and biometric authentication. These can make it harder for criminals to tamper with and access your wallet and crypto.
Keep Devices Up-To-Date
A hardware wallet gets regular software updates like your laptop, PC, or smartphone. In the case of hardware wallets, their developers roll out firmware updates.
Firmware updates enable hardware to access and adapt to the latest innovations. An example is support for more types of crypto; currently, there are over 8,800 active ones. If not for firmware updates, a hardware wallet may be unable to support recent releases.
Firmware updates also ensure that hardware wallets continue working with other devices.
Suppose you use an Apple Mac, which receives multiple updates yearly. While they help enhance your macOS, they can cause incompatibilities with other hardware. That other device can be your hardware wallet.
To prevent such problems, hardware wallet developers must also update their products. Doing so ensures that you can keep using your wallet without issues.
Most importantly, firmware updates improve hardware security. If not for these security improvements, your wallet can be at risk of malware infection. Especially since approximately 450,000 malware and PUAs get created daily.
So to store Bitcoin and other cryptos safely, keep your hardware wallet up-to-date. Do the same with your laptop or desktop computer. If they get infected, there’s a chance they can spread the infection to your wallet.
Use a Seed Phrase Backup Tool
According to The Crypto Merchant, a seed phrase is a master key that unlocks a crypto wallet.
Also called a “recovery phrase,” a seed phrase gives you access to your wallet if you forget your private key. So if you can’t remember the seed phrase itself, then bad news, as you can no longer access your crypto.
It’s a “phrase” because it contains multiple random words in groups of 12, 18, or 24. This makes it very secure but also very difficult to remember. That’s especially true if, like 37% of people, you have at least 20 passwords.
If you create a backup, you can prevent the disastrous losses of forgetting your seed phrase.
One of the safest ways to store crypto is to create a seed phrase backup with an offline, physical tool. For example, some people write down theirs on paper sheets and keep them in a secure place like a bank vault. This can be a good idea, but remember that over a thousand bank robberies still occur in the U.S. yearly.
While robbers may be unable to use the paper on which you wrote your seed phrase, it can still get lost. So, create other backups, such as with durable, tamper-proof metal plates. Then, store each in different secure locations.
Never Share Private Keys
No matter how secure your hardware wallet is, it’s useless if you share your private keys. Likewise, having the most durable backup tool won’t matter if you tell others your seed phrase.
So, never tell anyone what your private keys and seed phrase are. Don’t share details about your backup tools’ locations, either.
The only time you’d want to divulge details about your cryptos is in your will.
For example, you can create an inventory of all your digital assets alongside your will. However, you still shouldn’t put your private keys and seed phrases into writing.
Instead, prepare separate documented instructions on how to access them. Then, have solicitors store these documents legally and securely. You can also appoint a personal representative to deal with your assets in the event of your passing.
That’s How to Store Bitcoin Safely
Here’s one last eye-opening stat: Bitcoin owners have misplaced about 20% of all tokens. Even worse, these lost assets are likely no longer recoverable.
You don’t want that to happen to your cryptos, which is why it’s so vital to learn how to store Bitcoin safely. Thankfully, you now have the know-how, so please ensure you apply it in the real world.
For more of the latest on cryptocurrencies, check out our post on converting them to cash!
