How a hot wallet differs from a cold wallet, how not to lose funds when sending, and why you should not send seed phrases in messages. The answers to these and other questions are in this article.
What is a crypto wallet?
A crypto wallet is an electronic device, a physical medium, or a program or service where keys for cryptocurrency transactions are stored. It must be understood that the cryptocurrency itself is not stored on the wallet. It is stored on the blockchain, and crypto wallets are just a way to interact with it.
Differentiating Storage Methods
It is important to distribute your cryptocurrency assets between cold and hot wallets. Use hot ones when working with various web services, cold ones – for the most secure storage.
Attentiveness
For all their advantages, cryptocurrencies do not forgive mistakes when entering transaction data. By sending cryptocurrency to the wrong address, you lose it forever. There is no service that can return your funds or stop the transaction.
Protected environment
It is very important to monitor how you interact with the blockchain and how you store private keys. For transactions with significant amounts, try to avoid public networks, connect only from “clean” devices that you use solely for the purpose of making cryptocurrency transactions.
Fake websites and phishing
Fraudsters send out emails that contain a link to an app or website that imitates the design of well-known crypto services. Thus, attackers can gain access to user accounts and withdraw their cryptocurrency.
Fake crypto wallets
Fake crypto wallet apps for smartphones are common. After creating an account, the application generates a fictitious private key, while the real one remains with the attackers. If you send your funds to the address of this wallet, you lose control over them, which is tantamount to losing them.
How to secure your account on the exchange?
- Use a strong password and change it periodically;
- Start a new mailbox for cryptocurrency-related activities;
- Turn on two-factor authentication;
- Subscribe to notifications from the exchange;
- Add the exchange support service to your contacts for quick access.
Get professional advice
Cryptocurrency chats and forums are often sources of false or incomplete information about the principles of operation of the blockchain, Web3 and cryptocurrency exchange services. Always carefully check the information, you may be deliberately misled by scammers.
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