Nov 9, 2021 | Updated Dec 16, 2022
Lizzie Armanto : Hi Ian, simple question : I just bought my first crypto. Now, how do I keep it safe ?
Good question… And this stuff is confusing… With crypto, there are no dumb questions…
It takes a long time to get your head around this stuff, but I’ve yet to meet an intelligent person who has poked their head in this rabbit hole and come out un-changed…
So you’ve just bought some Crypto, how do you keep it secure?
Here’s the deal — The keys to security are… your keeeeeeyyyyyys……
It’s worth understanding a bit about how this works, technically, so you understand how to stay secure. As a Crypto owner, you have a wallet. Your value isn’t actually inside this wallet.
But when you create that wallet, it creates a pair of keys, a public key and a private key. The public key is like your mailbox address — anyone can send value to this address. Your private key is like your mailbox key, ONLY YOU should have this key to access your value.
Your private key is needed to sign any transaction that would move this value that’s assigned to you, which is why PROTECTING your private key and making sure ONLY YOU can sign a transaction is so important.
How do you store these private keys in the most secure way? There are a few popular ways people store crypto, and they are not all created equal… One way is to keep your value at an online exchange. While there are a few good exchanges, there is always a danger of your account being hacked, the exchange being hacked, or as has unfortunately happened a number of times, the owners of the exchange being dishonest and making off with the loot.
In short: IF YOU DON’T HOLD YOUR KEYS, YOU DON’T HOLD YOUR COINS.
Then why is a hardware wallet better for you to properly hold your coins ?
Because using a software wallet is like locking your house and then leaving the key under a potted plant on your front porch. That’s very cute. But if someone wants in, they will find a way in.
So, to answer your question directly: the safest way to store your crypto is on a Ledger device. But you need to be sure to do it correctly, with a backup device and to keep your recovery phrase in a VERY SAFE place!
So keep watching and I’ll tell you all I can about how to take every security precaution. And keep the questions coming.
FAQs
The safest place to store crypto is in a hardware wallet, which is a physical device that stores your private keys offline and keeps them solely under your control. A cold wallet is the most secure for long-term crypto storage. It protects against online attacks and unauthorized access.
How to keep your seed phrase safe? ›
Here are the best ways to securely store your crypto wallet's recovery phrase:
- Store it offline. If you keep your recovery phrase on any device that connects to the internet, there is a high chance that hackers can gain access to it. ...
- Splitting your seed phrase. ...
- Using a hard drive. ...
- Solid steel backup. ...
- Stonebook notebook.
The most secure option would be to use a metal card or a “paper wallet.” It's also preferable to store a private key rather than a seed phrase on the paper wallet.
What makes crypto safe? ›
They are secured by cryptographic systems and can be used to make safe online transactions without any mediators. The word “crypto” refers to cryptographic techniques and several encryption algorithms that help secure these records, such as hashing functions, elliptical curve encryption and public-private key pairs.
Where is the best place to keep crypto safe? ›
To prioritize security, storing the majority of funds in cold storage on a hardware wallet would be the best option. A small balance could still be held in a hot wallet for making transactions quickly and easily. Managing multiple wallets for different purposes is a popular choice for seasoned crypto users and whale.
What is the safest crypto to hold? ›
The world's first cryptocurrency, Bitcoin, has the largest market capitalization. Its established network, limited supply, and growing institutional adoption make it a relatively safe haven in the volatile crypto market.
What is a safe wallet to keep crypto? ›
Summary - 3 Best Cold Wallets of August 2024
| Company | Forbes Advisor Rating | Crypto Assets Supported |
|---|
| Ledger Crypto Wallet | 4.9 | 1,600+ |
| Ellipal Titan Crypto Wallet | 4.8 | 10,000+ tokens |
| SafePal Crypto Wallet | 4.5 | 30,000+ |
Jul 29, 2024
Which cryptocurrency is most secure? Ethereum is considered to be the most secure cryptocurrency as compared to other digital assets. This is largely because its platform uses the blockchain technology, which is one of the most robust technologies for digital transactions.
Is a 12-word seed phrase safe enough? ›
In practice, it is highly unlikely that an attacker could guess or brute-force a 12-word recovery seed with 128 bits of entropy in a feasible amount of time. Thus, a 12-word seed offers a high level of security that is sufficient for most users, striking a balance between security and ease of use.
What is the secret phrase in crypto? ›
Your secret recovery phrase is the key to your wallet and controls access to all your crypto. A secret recovery phrase is a set of words that correspond to numbers. These numbers make up a seed integer that generates all of the private keys in your wallet. Each address for every crypto has its own private key.
To sum up. Ledger doesn't have access to users' Secret Recovery Phrases, whether or not they subscribe to Ledger Recover. The OS update runs on the Secure Element. Downloading the latest OS update for your Ledger Nano X does not mean that your Secret Recovery Phrase can be extracted.
How do I make my crypto more secure? ›
Use 2-factor authentication (2FA)
And always use the strongest type of 2FA the platform allows, ideally a Yubikey or similar hardware security key. If a service provider doesn't allow Yubikey, use an authentication app like Google Authenticator or Duo Security instead of SMS-based 2FA if possible.
How do I lock my crypto? ›
How to enable the crypto withdrawals lock
- Navigate to Security: Go to the Security section on the Bitvavo website.
- Click on "Enable Lock": Find the option to enable the crypto withdrawals lock.
- Read the Explanation Carefully: ...
- Swipe the lock or type "Confirm": ...
- Lock Enabled:
Within self-custody, there are three main types of crypto wallets: software wallets, hardware wallets, and paper wallets. Bitcoin Software Wallets: A software wallet is a web-based, desktop, or mobile crypto wallet. Web-based wallets can be accessed via a browser from any phone or computer.
Is keeping money in crypto safe? ›
Storing most of your crypto in a secure wallet should give you some protection from theft. Using a hardware “cold” wallet can mitigate the risk of losing your crypto to an online hack.
How do I cash out crypto safely? ›
How to cash out your crypto or Bitcoin
- Use an exchange to sell crypto. One of the easiest ways to cash out your cryptocurrency or Bitcoin is to use a centralized exchange such as Coinbase. ...
- Use your broker to sell crypto. ...
- Go with a peer-to-peer trade. ...
- Cash out at a Bitcoin ATM. ...
- Trade one crypto for another and then cash out.
Pick a Broker or Cryptocurrency Exchange
Cryptocurrency brokers simplify buying crypto but may charge higher fees or restrict moving holdings off-platform. Examples include Robinhood and SoFi. Some investors prefer holding coins in crypto wallets offered by these platforms for added security.
How do I safely receive crypto? ›
In order to receive crypto, you must:
- Open your wallet and select Receive.
- Share your public key or address. This can be a QR code or a string of numbers and letters. You can send your QR code as a picture or allow someone to scan it in person.
