Learn how to best protect your investment and yourself.
Since about 2017, the world has burst with bitcoin excitement. Whether it’s joy or fear, support or contention, just about everyone has an opinion when it comes to bitcoin. Even the least tech-savvy person you can think of has at minimum heard of bitcoin and cryptocurrency.
Because of this mass adoption and widespread curiosity surrounding bitcoin and associated cryptocurrencies, even the founding principles of bitcoin has seen forks. Agencies and platforms designed to help anyone gain access to the fiat alternative have cropped up. https://bitvavo.com/en/, a trading platform designed for just such a purpose offers newbs and seasoned traders alike better options for storing, purchasing, and trading bitcoin.
But even though you’ve chosen to use a fantastic intermediary to help guide you into making the best possible choices for your bitcoin- there are still a number of security measures that you should be aware of. Almost all of which you can do yourself.
Crucial Differences Between Fiat and Crypto
Fiat currencies are private, centrally controlled storage devices designed to store, trade and use monetary values. Whether that value is represented by gold, paper currency, or credit scores, the idea is the same. You store your valuables in a bank or vault, designed to keep your assets safe. Often times what you own is disclosed solely to you, your financial institution, and the government. Money is held in wallets, credit on cards, and goods on deeds and titles.
Bitcoin and other cryptocurrencies are decentralized and public. What you own, store, and trade- while not being controlled by a centralized authority, is part of a public domain ledger. Making your finances fully viewable to anyone who understands how blockchain– the underlying technology of crypto- works.
Anytime you purchase, trade, or otherwise transact with bitcoin and cryptocurrency, your wallet address is tied directly to that transaction. Making it simple for anyone who cares to look to see just how much bitcoin you own and largely what you do with it. This is similar to making your bank statements publicly viewable.
Perhaps the greatest safety measure you can take for securing your bitcoin and your peace of mind is setting yourself up with a minimum of two wallets. Bitcoin wallets work similarly to ordinary wallets, as it’s a place that you use to store your money. With bitcoin wallets, they aren’t a physical storage space so much as they are a computer program.
At a minimum, it’s suggested that any owner of bitcoin have at least two wallets: one offline and one online.
Offline wallets, or cold storage, function more similarly to a savings account. These wallets are designed to store bitcoin and other cryptocurrencies that you don’t plan on using immediately. These wallets are not connected to the internet in any way and generally exist within your home computer or a USB drive. Keeping the bulk of your finances disconnected from the online world, and keeping hackers and other crypto predators at bay.
Online wallets, or hot storage, are designed to keep your crypto that you plan on using. These wallets are connected to the internet and are used to store the currency that you plan on using or trading. Depending on how active you are with bitcoin trading, these wallets usually hold around $200 worth of bitcoin, or just enough to play around with. As any hot wallet address is connected with any crypto transactions you make, anyone who knows how to read blockchain ledgers can follow your wallets address to find out how much bitcoin you own and even some types of personally identifiable information. Which is why it’s important not to store the bulk of your worth in any wallet that you use regularly.
Especially if you’re new to bitcoin, choosing a widely respected and secure trading platform is an ideal way to begin understanding how crypto markets function. Good trading platforms will offer up to date market information as well as a secure place to purchase, store, or trade your cryptocurrency.
Because of the wildly different nature of cryptocurrency trade and fiat trade, anyone who is new to the world of bitcoin should definitely consider choosing a reliable trading platform when you get started. This can starkly reduce the risk of falling prey to cleverly designed scams and hackers.
Most bitcoin trading platforms have high-level security features that it would be next to impossible to duplicate on your own. They also have seasoned professionals navigating the marketplace, and giving you expert insight into trends and forecasts.