The recent FTX cryptocurrency collapse has thrown the industry into chaos. Some are still trying to figure out what happened and how to recover. Others are taking a step back and looking at the bigger picture: How do we protect our crypto assets moving forward?
We've all heard horror stories about crypto exchanges being hacked and disappearing with investor money. Even worse, some of us have experienced it first-hand. Unfortunately, it's true when they say, "not your keys, not your money."
The best way to protect your cryptocurrency investment is by using a cold wallet. A cold wallet is a hardware device that's completely offline. It doesn't connect to the Internet, which makes it less vulnerable to malware, viruses, hackers… you name it. Storing your crypto on a Ledger makes it near impossible for others to gain access to your funds through cyberattacks, including those that target online exchanges.
Two-factor authentication is a security method requiring you to pass two distinct tests before you can get into your account. The first test is your username and password. The second test is usually a random code generated by an app on your phone, sent via text message or the app directly.
This security measure makes it significantly harder for unauthorized parties to access your devices and accounts. Always enable two-factor authentication on any site that offers it!
Protect yourself against hackers with strong passwords. A good one should contain a mix of letters and numbers, as well as symbols. Make a unique password for every account you have. Doing this ensures your accounts remain safe if one site suffers a data breach.
Some web browsers like Google Chrome automatically save passwords to make it a breeze to access accounts on personal devices. But it's always a good practice to keep track of your login credentials in a safe place.
If there's anything that the FTX crisis has taught us—it's the fact that coins aren't safe in exchanges—no matter how reputable they may seem. Any crypto exchange is subject to hackers, and you never know which one may be next to go bankrupt!
Remember that if you store your private keys in an exchange, you don't control those funds—the exchange does. So if something happens to that exchange, you'll likely lose your money.
Investing for the long-term? Keep some of your portfolio funds on an offline ledger for increased security. You'll get peace of mind that your coins aren't going anywhere at any given time.
Protecting your cryptocurrency assets is crucial, but not always easy. AR Collective, an active community of traders and investors, will help you stay on top of crypto news. This way, you can take the necessary measures to monitor and protect your investments. Become part of the family today!