Keeping Bitcoins Safe
Keeping Bitcoins Safe – With cryptocurrency’s increasing popularity and legitimacy as a form of payment, there are now many different ways to keep and store Bitcoins. Apart from the now widespread web wallets, where an online provider stores Bitcoins for you, there are many other ways to store the digital currency.
For example, it’s possible to set up a wallet on specialized hardware, such as a USB stick. Yet, there is no wallet variant in which there is no risk of loss; a web wallet could be hacked and a hardware wallet could be destroyed.
For this reason, you should choose a wallet based on your own personal requirements for Keeping Bitcoins Safe. At the same time, you should determine whether you are prepared to take the respective risk of loss. One solution to this would be to split your Bitcoins and store them across several wallets, so you don’t suffer a total loss if one wallet is compromised.
Probably the most popular form of wallet for Bitcoins is a web wallet. This is a wallet in which one stores cryptocurrency through an online provider. This takes care of the setting up of the wallet and sending individual transfers.
It is particularly important to select a reputable and proven provider to minimize the risk of loss. Although web wallets are generally considered to be relatively secure, there is, of course, some risk involved. For instance, the operator could freeze the managed Bitcoins and claim them.
Similarly, the account attached to the web wallet could also be hacked. However, there are many vendors offering security measures, like 2-factor authentication, for example, which should be set up to minimize damage from hacker attacks to keep Bitcoin secure.
Desktop wallets have mainly been used in the first years after the development of Bitcoin. These are wallets that store the data on a hard drive. But even with this type of wallet, you are still exposed to the risk of loss.
Again, such wallets should be reputable, otherwise, there is a risk that the program itself contains a virus and may be programmed to grant the developer access to your Bitcoins, which is a direct threat to your balance.
In addition, there is a risk of destruction of the desktop; the storage medium on which the wallet is located. In this case, there is no way to recover the Bitcoins. Thus, this type of storage is quite risky overall, as hard drives have a relatively high failure rate – one of many possibilities of Keeping Bitcoins Safe.
Of course, there are many more wallets that can be used to keep Bitcoin safe. For example, there are many different providers of wallets for smartphones. Features such as fingerprint approval or facial recognition provide a high level of security.
However, one should always keep in mind whether the respective app is a mobile web wallet application or a wallet that stores Bitcoins on the smartphone. This should be considered since wallets that store cryptocurrency on smartphones would run the risk of losing Bitcoins if the device was lost, but an application would not.
There are also “hardware wallets” in which the Bitcoin can be stored safely. Hardware wallets are mostly USB sticks on which Bitcoins can be stored and encrypted. There is no danger that the Bitcoins will be stolen, but a risk that occurs with hardware wallets is the possible loss of the wallet.
It could happen that the USB stick is lost or destroyed by external influences – instead of Keeping Bitcoins Safe. Overall, however, it’s one of the best ways to keep your Bitcoin safe.
Keeping Bitcoins Safe – the conclusion
It’s easy to see that it’s almost impossible to keep Bitcoins 100% safe. Nevertheless, there are some ways to minimize the risk of partial or total loss of Bitcoins. First, you should always check how reputable the provider of the preferred wallet is. User reviews can be helpful for Keeping Bitcoins Safe.
It can never be ruled out that a wallet will fail along with the Bitcoins kept therein. Therefore, the entire amount of Bitcoins in your possession should be spread across several different wallets. By doing this, the failure of one wallet would not incur a complete loss of your funds. This strategy also increases anonymity, since not all transactions are performed from the same address.
Alexander Weipprecht is the managing partner of Provimedia GmbH. As a trained IT specialist for application development, he has been advising leading companies on the following topics for more than 10 years: online marketing, SEO and software. Cryptocurrency is becoming increasingly important to businesses and investors. Through Coin Report and Krypto Magazin Germany, Alexander wants to give all people easy access to the subject matter.