The cryptocurrency market has become one of the largest markets in the world and certainly one of the fastest growing. Bitcoin has been an integral part of the cryptocurrency market’s rise. What started as a “fake currency’ that didn’t even have a value of a complete dollar is now one of the most valuable commodities with its market value going as high as $60k.
Bitcoin has proven to be one of the most amazing investment ventures for many investors who invested in Bitcoin in its early stages. Now, these investors are now relishing their rewards as “bitcoin billionaires”. Inspired by their success, legions of crypto investors have started investing in Bitcoin in hopes that they too will get a piece of the bitcoin pie. If you too want to be a part of these investors, you can visit this site to do so.
However, the newer investors that have just joined the bitcoin world are not used to it. Consequently, these new investors make a lot of mistakes that an experienced investor wouldn’t. While normally most of these mistakes are okay, since they are harmless and provide the investor with valuable experience, there is an aspect where all kinds of mistakes should be avoided at all costs.
This aspect is your cryptocurrency wallet. There are several common mistakes that many investors are guilty of making and these mistakes can cost a lot later on – to the point where you can even lose your entire wallet along with the contents inside it. To avoid this from happening, we have written this article pointing out the common mistakes people make when using their crypto wallets. Read the article till the end so you don’t end up missing out on crucial details.
1. Not keeping your keys safe
Crypto wallets have two forms of keys – public and private. The prior acts as your address on the crypto market and allows you the ability to conduct transactions with other users. The latter is more important and it acts as a password to your account. Forgetting this key means permanently losing all access to your crypto wallet.
That’s why it is essential that you keep this key safe with you all the time. Memorizing won’t do at all. Relying on your memory for something as valuable as access to your crypto wallet is just not practical. The best action that should be done is to take your public key, write them down somewhere and keep that note secured in a safe or locker that only you have access to.
Alternatively, if you have a system that hasn’t been connected to the internet and has no form of virus or malware on it, then you can put your keys in there. Ensure that the hard drive in the system is reliable or it might end up crashing and you will lose all access to your crypto wallet. Remember, keys are one of the most essential aspects of using your crypto wallet and it is your job to ensure you don’t forget them.
2. Storing too much currency in online wallets
Let us clarify one thing right away – your online bitcoin wallet, or hot wallet as it’s popularly known, is vulnerable to numerous security risks and dangers. Hackers can easily access your online wallets and put all your bitcoins into their own wallet and you won’t even know what happened.
That’s why it is essential that you only use online wallets for keeping short increments of your bitcoin assets which you will need for trading and investing in cryptocurrency. You can consider using multiple exchange platforms and keeping short increments of your cryptocurrency in all of them. This way even if your account gets hacked, you don’t stand to lose much.
3. Not checking your transactions for typos
One of the silliest mistakes many crypto investors, even the experienced ones, are guilty of is mistyping an incorrect amount in the wrong field and not checking it before doing the transaction. Many cryptocurrency exchanges ask you to verify the fields you have typed before you proceed with the transaction.
It has just so happened that many players, finding the verifications tedious, didn’t bother to check them and allowed a transaction to happen that cost them large amounts of money. In one such case, a trader paid almost 10x the transaction amount in transaction fees. That’s why it is essential that you always check the address you are sending your cryptocurrency to, check the various fields you have filled thrice not twice, and ensure that there are no typos or value errors.
4. Using online wallets as your main wallet
Many beginners who invest in cryptocurrency keep all their currency stored in their online wallets. As we discussed just in the second point, it is extremely unsafe to do so. However, these investors often don’t know the alternatives to hot online wallets which is why they keep using their online wallet as their main wallet.
We strongly recommend against doing this because of the security vulnerabilities online wallets are riddled with. Instead, we suggest using a cold wallet like a paper wallet or a hardware wallet. These wallets are offline in nature and are much more secure than hot wallets. Only use your online wallets as a secondary wallet for trading and instant access, nothing else.
5. Not taking proper security measures
Having a crypto wallet of your own means having a lot of responsibility. This responsibility consists of keeping your wallet secure and away from the hands of hackers. There are some basic safety measures all crypto wallet owners should follow like – not connecting to unsecured public networks and WiFi, not telling anyone about your crypto wallet, and keeping your keys safe with you so that only you can access and others can’t.
If you have hot wallets, then diversify your investments and diversify the number of exchanges you use. If you have cold wallets, don’t let them get damaged in any way possible – especially your paper wallets.
There are several mistakes people make when using a cryptocurrency wallet and we hope this article helped you avoid them. If this article was helpful for you, please consider following our website for regular updates as it will help us out immensely.