Like on social media platforms, people can encounter various cybercrimes in the crypto market. Due to this situation, people who are investing in cryptocurrencies or any other digital assets must know some tactics to protect their crypto investments from cybercrimes.
According to experts in this field, there are a lot of ways for tricking people investing in NFTs and cryptocurrencies. For example, we can mention rug pull or phishing in the NFT space, they are generally called NFT scams. Because of the existence of different trick methods, everyone must consider the below tactics for saving their investment in the crypto world.
The usage of hot or cold crypto wallet
There are different platforms to buy cryptocurrencies, and some of them are very popular in the space. However, the popularity of these platforms cannot sometimes avoid cybercrimes.
If you do not want to lose your crypto or NFT to scammers and hackers, you can move your crypto or NFT to your digital wallet in a short time when you buy them. Scammers and hackers can access the exchange floor and wipe it clean, so making your investment wait in a crypto platform is not logical.
In the virtual space, you can utilize hot and cold wallets for protecting your investment. In brief, hot wallets are connected to the internet via computers, tablets, and smartphones. On the other hand, cold wallets are specific hardware devices which keep users’ data offline. According to some experts, using cold wallets is better than using hot wallets, but each wallet type has different advantages and disadvantages.
Creating strong passwords
We think that creating strong passwords is a common and traditional method, but we want to emphasize the importance of strong passwords in terms of crypto investments.
Unfortunately, there are a lot of talented hackers and scammers in terms of their horrible ‘tasks’, so every person must use strong passwords for their crypto wallets. Also, users should create passwords that they can remember. Otherwise, crypto wallets can be locked up when the correct combination is not entered.
In addition to the usage of strong passwords, we want to mention that using a public network can create a risk for users. Hackers and scammers can collect cryptocurrencies or other digital assets in hot wallets easily and quickly when users utilize a public network.
Conducting research into crypto exchange platforms
As indicated in an old news, the popular cryptocurrency exchange, FTX, went bankrupt, and its users were alarmed about their investments. This circumstance can be the most proper example for conducting research into crypto exchanges to protect crypto investments.
When the popularity of NFTs, blockchain technology, and cryptocurrencies started to increase, lots of crypto exchange platforms are opened. Some of them, like FTX, encountered bankruptcy due to the crypto winter or other reasons. Because of the current situation in terms of crypto exchanges, you must focus on crypto exchanges in which you will invest.
Crypto exchanges do not guarantee the safety of their users’ investments, so users must consider this situation. For instance, you can research your preferred crypto exchange’s community and look for its social media accounts. You can utilize popular crypto exchange platforms, such as Coinbase and Binance, but you should also consider their advantages and disadvantages before making an investment.
Keeping private keys secret
A private key is a secret number, like a password, which is used in cryptography. For cryptocurrencies, private keys are also used; these keys are utilized for signing transactions and proving the ownership of a blockchain address. Because of this situation, these keys are vital in the field.
If you share your private keys with others, you can get risk in terms of your crypto transactions. Like your social media accounts’ passwords, you must keep your private keys to yourself. Sometimes, scammers and hackers can introduce themselves as experts in the field and request private keys, but do not forget that no one has the right to ask for your private key because it is not secure.
The above mentioning tactics are for protecting the existing crypto investments, but we want also to mention the process before investing in a cryptocurrency briefly. Before making investments, you must research the market capitalization and trading volume of digital assets. Moreover, you should not follow every hype in the crypto world because some hypes direct users to the wrong digital assets.