Storing cryptocurrency has become a common topic of conversation lately.
A lot of people are storing coins in wallets that they don’t control, which is dangerous because there’s no way to recover lost funds if something goes wrong with the wallet service provider.
There are many different ways to store cryptocurrencies, so it can be hard to know where you should put your money.
This guide will explain how to store cryptocurrency securely and what types of services exist so you can make an educated decision about where your money will be safest.
What Kind of Accessibility are You Looking For?
There are several different ways to store your cryptocurrency, especially if you find bitcoin atm near me.
Some people prefer storing their coins themselves on hardware or paper wallets, while others choose to use a wallet service that stores the private keys for them.
And then there’s storing cryptocurrency in an exchange, which can be dangerous because you don’t have access to your private key if something goes wrong with the exchange company.
The good news is that it doesn’t matter what kind of storage method you use as long as you do so responsibly and take measures to protect yourself against hackers and computer failures (which we’ll get into later).
First, let’s go over some basic definitions: hot storage refers to any type of cryptocurrency storage where the currency is active and can be spent.
Cold storage, on the other hand, refers to any type of cryptocurrency storage where the currency isn’t active and can’t be spent (it’s basically just being saved).
Hardware wallets are considered cold storage since you have to connect them before they’ll work. Paper wallets are also a form of cold storage because they contain your public key only, not your private key.
This means that you won’t actually be storing crypto until it has been transferred there first.
Are You Looking for a Wallet That Can Be Used on Your Smartphone or Tablet?
Desktop wallets are the safest option to store cryptocurrency.
The good news is that storing crypto on your desktop wallet doesn’t require much effort or technical knowledge since most of these programs sync with hardware and paper wallets directly.
Of course, there’s always a chance you’ll need to access it from another device if your computer breaks down which requires storing an extra copy of the wallet somewhere safe (like in a fireproof safety deposit box).
You can also use software called “hot storage” wallets that let you keep money actively spending but synced at all times so you don’t have to go through too many hoops when trying to spend funds.
They’re basically just like any normal app where you sign up for an account, make a purchase, and leave the wallet running in the background.
The only downside is storing cryptocurrency on your smartphone means it’s susceptible to hackers breaking into your phone (which could happen if you’re using an Android or iOS device).
There are some mobile wallets that give you access to both hot storage features as well as cold storage for added security but they come with higher fees.
What Sort of Backup Options Does Your Wallet Provide?
It’s a good idea to create backups of any wallet you’re storing cryptocurrency in just in case something goes wrong with your computer or if hackers try breaking into the system.
Most desktop wallets use “seed phrases” which are long sets of random words that store all the information needed for access.
What this means is even if someone broke into your computer and stole your seed phrase, they still wouldn’t be able to steal your money because it needs both pieces (the seed phrase + private key) to unlock funds from storage.
Any type of paper wallet should also come with a way to generate a new public address each time you go online, but there might not be an option for creating multiple addresses since some wallets are designed to keep your funds in one spot.
If you’re storing cryptocurrency on an exchange, make sure there are options for adding extra security and creating backups if anything goes wrong with the system.
It’s also a good idea to store only small amounts of currency at any given time since exchanges attract hackers looking to pull off large-scale heists.
What Kind of Reputation Does the Wallet Have?
There are a lot of wallets out there that have been known to steal funds from their users, so make sure you do your research before storing cryptocurrency in any wallet.
You can always check the history of complaints against them online using Google Reviews or looking at forums where people discuss open issues with products and services.
Is There Any Customer Service Available?
Customer service can make or break your wallet, especially if you’re storing large amounts of cryptocurrency and need help recovering funds.
Some wallets offer live chat support while others have phone numbers that customers can call during regular business hours to get quick answers made by professionals who know the ins and outs of storing crypto safely.
What Fees Does a Wallet Charge For Using It?
You should always look at any fees associated with storing cryptocurrency in a wallet since they might be eating away at your profits without you even knowing it.
Most desktop wallets don’t charge any fees but some mobile apps do require small charges every time you sign up for an account which may not seem like much on its own but could add up over time depending on how often you use them.
What Are the Fees for Making Purchases On a Mobile Wallet?
There are some mobile wallets that come with really high fees attached to transactions like TenX (which charges users up to 50% of what they spend) or Monero (which requires fiat conversions before letting customers buy crypto).
You should always check out forums online where people post their experience using these types of apps since it’s likely other wallet providers offer better rates and more affordable ways of storing cryptocurrency on your phone without paying outrageous transaction fees.
Does the Wallet Allow You to Store Multiple Copies in Different Secure Places?
It’s always a good idea to store multiple copies of your seed phrases or private keys in different safe places since storing cryptocurrency is all about protecting your funds from hackers, thieves, and other issues that might pop up.
Most wallets allow you to print off paper backups so it’s easy to keep them at home but some also offer additional options like storing them on encrypted cloud storage (like Dropbox) which will prevent anyone without the password from accessing this information online.
If there are any extra fees associated with storing wallet backups, make sure they’re clearly stated and don’t cost too much for how many times you plan to use the option.
Does the Wallet Allow You to Protect Your Private Keys?
Some wallets make it difficult to protect your private keys and storing cryptocurrency becomes a serious pain when you can’t access this information in an emergency.
You shouldn’t store any type of currency on mobile apps that won’t let you secure the wallet with your own password since anyone who gets their hands on these types of backups will be able to recover all funds connected to them without worrying about anything else.
There are also hardware wallets like KeepKey which allow users to add passwords for extra security but most desktop and web-based applications do not offer this feature so always read up before trusting one with storing cryptocurrency long term.
Does the Wallet Offer Two Factor Authentication?
A lot of wallets let users add additional security by setting up two-factor authentication which means you’ll be asked for another key or confirmation code before accessing funds.
This is one way to make storing cryptocurrency more secure but it’s always good to look at what types of methods are available since some only use basic codes sent through SMS messages while others offer newer options like Google Authenticator, Authy, and Duo Security using push notifications on your phone instead.
Is Your Software Being Kept Up-to-Date?
One of the worst things that can happen when storing cryptocurrency in a wallet is being hacked because your software isn’t up-to-date which makes it easier for cybercriminals to access your funds.
Make sure you take advantage of any updates offered by wallets whenever they come out since these types of patches are often created with security vulnerabilities in mind and will make storing cryptocurrency more secure long term.
You should also look into how quickly new versions get released (or if there’s an app versus desktop version) before storing cryptocurrency on anything that takes longer than usual to update every time one becomes available.
Does Your Wallet Require a Multi-Signature?
If you’re storing cryptocurrency on your own, it’s important to look for wallets that require multi-signature access since this is one of the best ways to increase security and prevent hackers from stealing funds.
Multi-sig basically means multiple people have their signature keys before money can be transferred which makes storing cryptocurrency much safer than just having someone else hold all information needed to complete transactions with your digital assets.
Are You Putting All Your Eggs in One Basket?
It can be a good idea to store cryptocurrency on your mobile device for easy access but storing large amounts of digital currency in one place is never a great idea since it makes it much easier for hackers to take over.
Be careful not to keep anything connected with storing cryptocurrency online (like an email address) unless you trust the service completely and always make sure storing cryptocurrency on a desktop is as safe as possible by using two-factor authentication and strong passwords.
Even if you put security first when storing cryptocurrency, it’s important to always have extra backups in the form of digital copies or paper wallets so there are alternatives available for recovering funds whenever something goes wrong.
Are You Being Provided Customer Support?
Storing cryptocurrency on a wallet is effective as long as you’re fully supported throughout the process so it’s important to look at customer support options before deciding what type of storage method will work best for your needs.
You should also look into how quickly support gets back to users if there are any issues making storing cryptocurrency on a wallet much easier.
Are You Aware of Any Phishing Scams?
One of the most common mistakes made by storing cryptocurrency on a wallet is falling for phishing scams so it’s important to look into what measures are being taken to prevent these types of attacks from happening.
If there have been any major issues with storing cryptocurrency in the past, you should think twice before trusting your investment with anyone who isn’t fully committed to storing cryptocurrency safely.
Does Your Wallet Require a Private Key?
If you’re storing cryptocurrency on your own, it’s important to look for wallets that require private keys since this is one of the best ways to increase security and prevent hackers from stealing funds.
Private key basically means having complete access to digital assets which makes storing cryptocurrency much safer than something that requires a third party.
Are You the Only One Who Can Make Transactions?
It can be a good idea to store cryptocurrency on your mobile device for easy access but storing large amounts of digital currency in one place is never a great idea since it makes it much easier for hackers to take over.
Be careful not to keep anything connected with storing cryptocurrency online (like an email address) unless you trust the service completely and always make sure storing cryptocurrency on a desktop is as safe as possible by using two-factor authentication and strong passwords.
Even if you put security first when storing cryptocurrency, it’s important to always have extra backups in the form of digital copies or paper wallets so there are alternatives available for recovering funds whenever something goes wrong.
Ready to Start Storing Cryptocurrency?
As you can see, there are many different methods for storing cryptocurrency properly. To learn more about this subject, continue reading this blog for more helpful articles.
