Bitcoin is the most popular cryptocurrency as it allows users to make transactions at an affordable rate without involving any financial intermediary. It is a decentralized currency, so there are no regulations or laws imposed on it. It offers great freedom to the users but also increases the risk of fraud and scams. So, you need to take all the precautions to avoid scammers and frauds. There are some useful security tips mentioned below that you must follow to ensure that you are safe from all kind of threats while using bitcoins.
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Stay away from scams
Bitcoin is a cryptocurrency with minimum laws and regulations, which makes it an easy target for hackers and scammers. One of the common ways used by people to do frauds with bitcoin is phishing. Phishing is a way to steal crucial information from people by making them click on a malicious link or disguising themselves as a fake entity. Hackers create a fake bitcoin exchange or web page and send an e-mail on its behalf to bitcoin users. Bitcoin users trust the e-mail and click on the link provided in it; once they click on it, the scammer gets access to the information stored on the bitcoin system.
So, you must be careful about such scams and try to store private keys offline. But if you have stored the private keys on a computer that is connected to the Internet, you must avoid clicking on any suspicious link as it can be a phishing scam. To avoid the risk, you must match the link with the one in your exchange.
Never store bitcoins with exchanges
Bitcoin exchange is an online platform used by several bitcoin users as it allows them to buy and sell bitcoins with great convenience. Online bitcoin exchanges are also used for bitcoin trading, and it offers an option to the traders with which they can store the bitcoins with the exchange for better accessibility. It seems to be a good idea, but you must avoid it at all costs. First of all, bitcoins are irrecoverable, so in case your bitcoins get stolen or lost, you won’t be able to recover them.
Secondly, it is a decentralized currency, so if the exchange freezes or uses your funds, you won’t be able to do anything about it. Moreover, online bitcoin exchanges are highly prone to cyberattacks, and if the exchange gets hacked, you may lose all your stored bitcoins forever. So, you must avoid storing bitcoins with online exchanges, and if you want to do it, you must do proper research and choose a well-reputed, secure and reliable option.
Use hardware wallets
When it comes to the security of bitcoins, wallets play an important role. A bitcoin wallet is a digital locker in which you can store bitcoin safely and make transactions too. There are several types of wallets that you can use, but when it comes to security, hardware wallets are the best. A hardware wallet is a USB device in which you can store private keys and keep them safe from hackers, thefts, and malware.
Hardware wallets are considered to be the safest as they cannot be hacked and allows users to sign in easily. The only risk with it is that the hardware wallet gets stolen, but there is a solution to it too. These wallets come with a seed, which is a paper that you can use to transfer the private keys to any other bitcoin wallet.
Don’t use public WiFi networks
It is obvious that being a digital currency; you will need an internet connection to make a bitcoin transaction. The WiFi network used by you to make transactions can affect the security of your bitcoins to a great extent. There are two types of WiFi networks; private and public. Public networks collect all the data transferred over it, so you must avoid using that. It can leak your wallet password or any other crucial information that can create issues for you.
If you want to enjoy excellent security and privacy, you must use private WiFi networks as they are more secure and keep all the information hidden. For additional security, you can use VPN as it will hide your IP address.
