How to Keep Your Bitcoin Safe and Secure

There are so many ways through which you can lose your Bitcoin, as well as other cryptocurrency tokens. The main one includes theft, which can happen anonymously online. You can also lose your Bitcoin through computer failure or if you lose your keys.

Below, we show you how to keep your Bitcoin safe and secure.

Best Ways to Store Bitcoin Safely

Fortunately for Bitcoin users, there are so many ways that you can store your Bitcoin safely. These methods ensure that your wallet is safe all the time.

1. Desktop Wallet

This method of securing your wallet is also known as cold storage. With desktop wallets, it means that they are not connected to the internet, which makes them offline.

There are so many advantages of using an offline storage method for your Bitcoin wallet. One great advantage of this method is that your wallet is not accessible from anywhere in the world since they are not online. This means they are protected from potential hacking.

You can only access your wallet from your local private computer. Your personal security keys are stored only on that machine. That minimizes the risk of your security key being exposed online by mistake.

If you decide to use this option, we suggest that you invest in a strong antivirus so that you can protect your computer from any malware that is designed to steal Bitcoins or root out keys.

2. Hardware Wallet

This method is more secure than the one mentioned above. With this option, the wallets are bits of hardware, which are external devices that you can carry around on your person.

One biggest advantage of this method is that you are able to transact in complete anonymity. In fact, no identifying information can be licked because the hardware is not linked to any personal information.

Another great advantage of this method is that you can actually recover your funds using a seed phrase in the event that you lose your wallet. On top of that, your wallet cannot be attacked by malware.

We only suggest that you keep your hardware wallet safe because if you lose it, you will not be able to recover your bitcoin.

3. Paper Wallet

In order to use this method for securing your Bitcoin, you will need to have a clear understanding of how digital currencies work.

To get started, you must first of all make sure that you generate a paper wallet online. This is achieved by using a number of dedicated websites. You will also be able to achieve it by generating the wallet offline, which is more secure.

Paper wallets are just a Bitcoin seed that is written in a unique way on a piece of paper. Because of that, you'll be able to store them quite easily as they do not require a great deal of space. On top of that, you can transact anonymously.

4. Physical Coins

Now, Bitcoin users are actually able to buy physical Bitcoins. The coins you will buy come with a tamper-proof sticker card, which covers a predetermined amount of Bitcoin.

If you decide to go this route, be prepared to pay extra money in order to cover the cost of manufacturing, as well as for the shipment of the coin. Typically, you will be required to pay a premium that is slightly over the value of the Bitcoin that you intend to buy.

Other Security Precautions

Backup

We strongly recommend that you regularly backup your entire Bitcoin wallet. This will come in handy in the event that your computer fails. If you've already backed up your wallet, you will be able to recover the currency in the digital wallet.

When backing up, make sure that you backup all wallet.dat files. When you have done that, in order to make sure the files are not lost, store them at multiple locations such as USB sticks, CDs, or hard drives. You will also need to set a very strong password for all your backups.

Software Updates

Outdated Bitcoin software can easily be hacked. This is why we suggest that you always update your software. Updated wallet software versions have better security systems in place.

Multi-Signature

This concept has gained a lot of popularity as it ensures better security. With multi-signature, it means that a number of people will have to approve a transaction. This can be anywhere between three and five people at a time. That means one person will not be able to process a transaction without the approval of all the other people in the group.

Because of that, threats of theft are greatly reduced. The people that have to approve all transactions have to be decided in the beginning, and if anyone of them wants to spend the Bitcoins, they will have to get approval from the rest of the people in the group.