Every new invention comes with its own challenges, this is peculiar with new technologies, and the cryptocurrency has had its fair share of this challenge. Although many cryptocurrency companies have proved to be unhackable, it is important that investors equip themselves with the knowledge on how the cryptocurrency security works before making a move to buy Ethereum or its equivalents.
That way, they will have clues on how to protect their portfolios in case of any eventuality. Protecting your investment as an investor doesn’t necessarily mean you are guiding it against hackers, but most of the time, some investments get lost because of sheer human errors.
You can imagine a situation where you buy Ethereum and end up sending it to another wallet or using the wrong transfer method. Not just that, scammers also spend their day looking for new ways to scam naive investors. So, it is better you equip yourself with the necessary knowledge of the industry against any impending danger that might emanate from either scammers or errors. Below, we have explained ways investors can safeguard their portfolios against theft.
5 Proven Ways you can Guard your Portfolio
1. Activate a Two-factor Authentication Method
Let’s assume you are the type that normally buy Ethereum for keeps. Although these exchangers are secured, at times your login details may get compromised by a third party – it may be a friend or family member, thus, a breach. Normally, a centralized crypto exchange should work as a gatekeeper for their investors, but when the breach comes from your end, there is little or nothing they can do about it, as it will be seen as a normal login procedure, since the action came from your device. To avoid this, a two-step process is advised. A two-step verification method includes connecting your email address to request for pin code through biometric or SMS means in order to access your account. Most platforms require this same process even before you proceed to buy Ethereum or any other coin, not just for logging in.
2. Consider Cold Wallets
As much as customers are confident in the services they give, you should insure your investment through the use of a cold wallet. In other words, most companies even go as far as moving most of their major investor’s funds to a cold wallet device in case of any hack. When we say cold wallet, it means that those values in it are out of active transactions. Let’s take for example you wish to buy Ethereum, after which you move it to an entirely different wallet that is outside the exchanger you bought it from. Should anything happen to that exchanger, it won’t affect it ‘cos it is out of reach.
3. Don’t Fall for Scammers
Even when you apply all the necessary precautions mentioned above, your reaction when you are approached by scammers says a lot. Reputable companies can never send you a message requesting your personal login information, nor will they request you fill some ridiculous form before you can make your withdrawals. Again, do not go sending your coin to some unknown wallet, they hack your account using such means – this trick often happens when you want to buy Ethereum or any other performing coins.
4. Use only Secured Internet
Even when you transact with the most secured exchangers, the need to use a well-secured Internet connection is important. Hackers can penetrate your account via your internet connection. To do this, we’d recommend you use a VPN. The job of a VPN is to add extra security to your network by changing your original IP and location. Again, don’t make the mistake of using a public internet facility to access your account, it is not safe.
5. Have a Multiple Account
You must have been told not to put all your eggs in one basket. Well, that also applies to how you buy Ethereum and other performing coins and how you keep them. Here, we had advice to use either multiple cold wallet methods or hot wallet; whichever one you choose, make sure you have more in other platforms.
Finally, although hacking rarely happens, this is because companies are doing everything possible to prevent being hacked. But you need to do your bid by applying the necessary security precautions as listed above. And note, there are some other ways investors can protect their crypto portfolio, but the ones we listed above are the most recommended.