An Introduction -Bitcoin
Bitcoin has revived its peak time and more so in 2019 and 2020 as it witnessed in 2017, soon after which it saw a fade. As Bitcoins have become popular, they have attracted hacking attempts, and many investors are unaware of how to secure their investments from being stolen. The hacks take place blatantly when the tokens meant for one wallet are rerouted to other wallets. The victims see it happen before their own eyes, helpless. Owners and wallet users can lose their bitcoin and other cryptocurrencies due to computer failure, theft, loss or stolen access keys, and more. Bitcoin is the most widely used decentralized virtual currency, and it is volatile too. As 2021 started, the price of Bitcoin reached its all-time high & which continues its upward trek till now. Today, the current trading price of Bitcoin is $58,328.60 with a market capitalization of $1,088,255,971,727. Some crypto experts predicted that the price of Bitcoin will rise more in the coming future & may reach $100,000 soon. Several investors plan to invest or trade in Bitcoin as the price goes up every day. If you are planning to invest or trade in Bitcoin. The Bitcoin Future is an automated trading platform for Bitcoin & cryptocurrency, which uses a smart trading robot program with an AI-based algorithm & comes with a high rate of accuracy. To know more about this, you can check reviews on Bitcoin Future. But, here in this article, you’ll get to know how you can keep safe and secure your Bitcoin.
How to Secure Bitcoin?
To keep cash or credit cards safe, we maintain a physical wallet; similarly, we store bitcoins in a digital wallet. There are different types of digital wallets. It can be based on hardware or the web. The wallet may be kept on a mobile device, computer desktop, or printing or writing down the addresses and private keys on paper. The only question is are these digital wallets safe? The biggest threat in securing bitcoin is losing or misplacing the private key or theft. Losing private keys means never seeing bitcoins again. When a user loses one’s private keys, one may also lose bitcoin due to crashing of a computer’s hard drive or any type of malfunction, or if someone hacks the system, or if the computer itself is stolen or lost.
Yet, many companies are accepting bitcoin and altcoins. Merchants benefit from much lower transaction fees than any credit card, at 2 to 3 percent. Customers also are protected while making bitcoin payments as they leave no data behind, and their ID cannot be misused or stolen.
Besides offering financial benefits, Bitcoin is protected from theft owing to many factors: Cryptography manages the generation and transfer of a token. The protocols managing Bitcoin has been proven to be robust. Bitcoin uses blockchain, a distributed ledger, and provides all records of a tamper-proof transaction as it does not have a single point that can be failed.
What Are the Ways to Keep Your Bitcoin Safe & Secure?
Even with robust Bitcoin protocols, hackers have not been discouraged to mess with the bitcoin exchanges and wallets, which is software stored in smartphones and computers. The government does not regulate Bitcoin, and therefore it does not give that type of security or insurance like a bank does. For instance, in the past, the two cases of Flexcoin and Mt. Gox shut down after hundreds and thousands of bitcoins were stolen by hackers in different attacks. Let us discuss the different ways to maintain one’s Bitcoins.
Online wallets are referred to as Hot Wallets. Hot wallets run on devices that connect with the internet, like phones, computers, or tablets. This creates insecurity as the wallet stored on these devices generates the private keys for the owner’s bitcoins. Hot wallets provide convenience for fast access to your assets and making a transaction; they have a higher risk from attackers. When people do not use adequate security, their funds get stolen, which happens frequently. When we save money in a bank, we keep major reserves in the savings, and only what we need to spend on the checkings. In the case of hot wallets, it makes no sense to store the bulk in devices like desktop, mobile, web, exchange custody wallets. Exchange wallets like Binance, Coinbase, Gemini are not the same as personal wallets. They are custodial wallets that the exchange provides. But during a hack on the custodial wallet, the owner’s cryptocurrencies are stolen, the exchange will not reimburse them as they do not have FDIC or SIPC insurance. Instead, it is a better idea to withdraw the larger number of the coins and put them in a cold wallet.
Cold wallets are the safest option. It is not connected to the internet; therefore, it is less risky. They are also called hardware wallets or offline wallets. They store users’ addresses and private keys offline and provide software that users may operate to see their accounts without risking the private keys.
Some services allow owners to buy physical Bitcoins that come with a tamper-proof sticker covering an encoded amount of Bitcoin. These physical Bitcoins are sold with a slight premium.
What Is the Safest Way to Store Bitcoin?
The safest is a paper wallet, a type of cold storage. The owner prints out public and private keys on a piece of paper. Most owners laminate the paper and keep them in safe deposits in a bank or at home. A hardware wallet is a USB drive on which the owner stores the keys. It stays safe from viruses and malicious software as it never comes in contact with the internet.
Owners and wallet users can lose their bitcoin and altcoins due to computer failure, theft, loss, or stolen access key. Some people store their private keys and bitcoin in hot wallets like smartphones, tablets, or computers. But cold wallets like maintaining bitcoin in a USB drive and the private keys on a printed piece of laminated paper is the best and the safest option.