If you had told the masses that a digital currency would cause havoc in the world a decade ago, no one would have believed you. And here we are, in 2021, with cryptocurrency revolutionizing the world of investing and assets.
To put things into perspective, as of February 2021, the market capitalization of bitcoin alone stands at a whopping 1072 billion USD, as per Tech Jury! Another currency, Ethereum, witnessed a million transactions last year, as reported by Statista.
With digital currency slowly being adopted to mainstream usage, one might wonder if it is truly safe to utilize cryptocurrency, store it and purchase items through it. To keep it short, it is still complicated. However, you can put your cryptocurrency to good use with the right actions without worrying about its security.
Here are five tips that might come in handy.
Convert it to fiat currency before conducting transactions
One of the safest ways to utilize cryptocurrency is to convert it into fiat currency when issues related to uses of digital asset arises. After all, at the end of the day, there is nothing safer than fiat money. Not only is its value stable, but it is accepted globally, without any hiccups.
tIt has become increasingly easier to convert cryptocurrency into fiat money, which has also made utilizing digital assets very lucrative. Now, you will find a plethora of Bitcoin ATMs worldwide, which can aid in converting for a nominal fee.
As per Statista, every year since 2015, the number of Bitcoin ATMs worldwide has grown, owing to the increase in popularity of the asset. As of 2021, there are approximately 14,000 such ATMs globally.
If you can easily access one, this is an excellent way to get your hands on hard cash for conducting a transaction.
Use trusted platforms
As cryptocurrency has entered mainstream usage, various companies and platforms now accept it as a viable form of payment.
For starters, you can now buy used cars with cryptocurrency! Can you imagine doing so a few years ago? Probably not! Even popular companies like Starbucks, Tesla, PayPal, and Sotheby’s accept digital currency as a payment option.
If you are transacting with such platforms, you don’t have to worry about the safety of your investment. This is because such platforms have enhanced security, thereby ensuring that the payment channel is safe enough for you to complete the payment process.
When utilizing cryptocurrency directly with a website, make sure to do your research and gauge whether the platform is trustworthy. For purchases as big as cars, you will find P2P selling platforms worthy of your attention. Your job is to find them.
Use a hybrid approach
Did you know that there are over 70 million cryptocurrency wallet users in the world? As more and more cryptocurrencies are being introduced in the market, the number of online wallet users is also steadily rising.
This has made the online solution a lucrative platform for hackers. In fact, in 2019, BITpoint, a Japanese exchange service, discovered a fraudulent withdrawal of a whopping 32 million USD from an online wallet, from a cumulative of 50,000 users!
To minimize the loss in case of a hack, it is best to use a hybrid approach when safekeeping cryptocurrency. In other words, you should use a physical or offline wallet along with an online wallet. Offline wallets are not connected to the internet and hence are safe from cyberattacks.
Only keep a nominal amount in the online wallet while keeping most of your assets in the offline wallet. Think of the latter as a safety deposit box. Also, keep public and private keys for both wallets, with strong passwords and authentication if possible.
Use reputable services
The best way to ensure the safety of your digital asset and hence be able to utilize it safely, you must seek out the right cryptocurrency exchanges, wallets, mobile apps, and brokerages.
Regardless of which of the mentioned platform you use, make a point of carefully researching their security feature. Dig deeper into exactly how the given platform protects your data.
For starters, make sure you only choose services that require multifactor authentication. This will make sure that no one will be able to access your currency without your authorization. Additionally, look out for SSL and TLS encryption for solid protection.
As cliché as the adage is, truly try never to put all your eggs in one basket! If you have accumulated a significant amount of cryptocurrency, try to use multiple platforms for storing or exchanging it. While you are at it, never use the same password for two platforms.
By doing so, you will minimize the risk of loss in case one of your accounts gets compromised.
Be cautious of phishing scams
Malicious ads, as well as emails, are quite rampant in the world of cryptocurrency! Unless a given link or message comes from a trustworthy source, think twice before clicking on it.
In fact, be suspicious of seemingly authoritative links as well. The scams of today are quite sophisticated and hence can go unnoticed.
The key to utilizing cryptocurrency safely is to ensure that you don’t lose your earned asset in such scams. So, keep an eye out. Report any malicious link to the cyber cell of your country.
Use a combination of these five tips to secure your cryptocurrency from the moment you obtain it to the point of transaction. There are various pitfalls to avoid throughout the process since cryptocurrency is still new and hence developing.
It might take a few years for the technology to be secure enough to be synonymous with fiat currency. Until then, take the necessary precautions to safely use it for carrying out transactions.
Are there any other tips that have helped you when using cryptocurrency? Let us all know!