If you’re just getting into using Bitcoin or other cryptocurrencies, a digital wallet is a “must have.” A cryptocurrency wallet is a software program that stores your public and private keys. The wallet also communicates with various blockchain so you can monitor your balance, send money, and perform other tasks related to cryptocurrency.
Even though cryptocurrency wallets don’t hold any of your currency, the information stored in your wallet (such as your private keys) is vulnerable to theft so a secure wallet should be a priority. Many assume that digital wallets are all the same and although they share some of the same functions, some are more secure than others.
A cryptocurrency cold storage wallet is kind of a happy medium between hardware and hot wallets. While hardware wallets are the most secure, they might be a little more than what you need and can cost more than you want to spend. A hot wallet is no doubt convenient but always connected to the Internet so it’s the most vulnerable.
Keeping Your Cold Wallet Secure
A big plus about the cold wallet, also known as cold storage or offline wallet, is that it’s not connected to the web. Depending on the type of cold wallet you have, you may need to connect to the Internet so you can make transactions.
Your other option is to allow your transactions to be authorized offline and broadcasting to the bitcoin network without using the private keys (which remain secure). While your cold wallet is significantly more secure than a hot wallet, here are some steps you can take to ensure your wallet stays safe and you don’t lose your money.
Amp Up The Security On Your Device
Whether you have a mobile, desktop, or online wallet, security is essential. Even if you opt for a wallet that stays offline and rarely connects to the web, you aren’t completely immune to threats. While a cold wallet is tough to hack, it’s only a matter of time before someone figures out a way into your wallet. Boosting the security on your device can help a lot.
Most PCs and mobile devices like smartphones have security features and software that do a good job of keeping your information secure. Adding a little extra security to your device can make it even more difficult to gain access to your information.
When you read the Scanguard review, you’ll see a great option for making your security even better (and your cold wallet more secure, too).
Recovery Seeds Belong Offline At All Times
If you lose your wallet (regardless of the type), your recovery seed can help you recover your funds and the wallet. When you set up a wallet you are given a recovery seed code; always write this down and put it in a safe place, offline. Write the code down on a piece of paper and store it in a safety box or even store it on a flash drive (which you use for nothing else).
Even if you’re relatively new to cryptocurrency and it’s hard to imagine digital wallets being the same as other assets, it’s important to treat your cold wallet like any other confidential document. Once it’s gone, it can be hard to get back and your information may be made public or at risk.