How to secure your cryptocurrencies!

Rakesh K. SinghUpdated: Thursday, March 17, 2022, 01:50 PM IST
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India experienced an unprecedented increase in the number of people investing in the crypto markets in 2021! About 20 million people have jumped onto the crypto bandwagon in 2021. Cryptocurrencies have become a part of the India Investor’s lexicon. At present, Indians hold crypto assets worth $5.3 billion! Bitcoin continues to dictate the rest of the crypto market.

Fueled by intensive advertising campaigns by prominent personalities and crypto prices touching all-time highs in April 2021, many small Indian investors put their risk capital in crypto currencies. The favourites being Bitcoin, followed by Ethereum and a lesser-known coins like Solana, Polygon, Terraluna and stable coins like Tether too. As a result, crypto platforms witnessed record growth in users and transaction volumes. The biggest Indian crypto broking platform registered a 3500% rise in transaction volumes and touched 14 million users recently.

As things progress, crypto currencies have become mainstream. Especially people from Tier II and Tier III cities stared participating in numbers and the key players also launched new products to attract a wider user base. With such a fast and exponential increase in the users, it is being increasing felt the need to secure it!

While most crypto platforms are secured enough for a longer duration, it is always advisable to know all that you can about how to ensure that you don’t get scammed or fall prey to phishing when it comes to your hard-earned cryptocurrency. With the gaining popularity we are already witnessing various crypto scams across the globe. Here are a handful of measures which one should take while managing cryptocurrencies:

- Select the right exchange

Always choose an exchange trusted by many and which has the best available security systems in place to secure your cryptocurrency.

- Safeguard your private key

All cryptocurrencies are stored on digital wallets or on exchanges, the key/password to which is given to the owner in the form of an alphanumeric code/password. It is very crucial to safeguard this private key/password at all times.

- Withdraw Money to Hardware Wallet

All crypto currencies can be withdrawn from the exchange and safely put up in your hardware wallets like Ledger or Trezor. You need to ensure proper key management so that even if the exchange gets hacked, your funds are duly protected.

- Use cold wallets and hot wallets

There are two main types of wallets to store your crypto currencies – hot and cold. Hot wallets are connected to the internet and can be accessed anytime while cold wallets store your funds offline.

- Pre-empt attacks by hackers

The best way of preventing attacks is to keep your keys safe and by keeping tabs on any news related to hacking to ensure your assets are safe.

Conclusion: In spite of following all the safety and security measures, you might still be susceptible to various attacks and frauds, but caution is the key to safeguard your crypto assets. Crypto currencies once lost or stolen are impossible to retrieve. So, stay alert at all times!

(Rakesh K. Singh is an Advocate by profession and is the Founder Head of Law firm RKS Associate. He is also the Founder Head of NGO - Bharat Utthan Sangh. All views expressed in this article are his own.)

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