The journey of bitcoin has been full of ups and downs. For the first time in 2017, its price reached its peak, but suddenly its popularity started to fade after making its price reach the sky. Bitcoin is the only cryptocurrency that has gained huge popularity because it is decentralized in nature. Because of its rising value, there have many hacking events have taken place in recent years.
This has made many investors and traders think before dealing with bitcoin. Investors must learn how to secure their investments and make bitcoins safe from hacker attacks also know about bitcoin
As fiat currencies are stored in a physical wallet that is the bank accounts, the bitcoins are stored similarly in wallets. The only difference between both wallets is that bitcoin wallets are digital. Since bitcoins are intangible, they are to be stored in digital wallets. A wallet is a program that is designed to store bitcoins and allow users to send and receive bitcoin from anywhere.
The wallets are of a wide range, including desktop, physical, mobile, paper, and more. Despite choosing the wallet, it is crucial to learn about the aspects of a digital wallet. You must be aware of three main things, which include the bitcoin address, the public key, and the private key. The bitcoin address is the wallet's address, and a transaction can only be accomplished if you know the bitcoin address of the receiver. The public key and private key are the digital keys that must be kept safe to protect the bitcoins.
Ways to store the bitcoins securely
Hardware wallets are considered one of the safest wallets. The hardware wallets are in the form of external devices that include USB sticks and more. These are the bits of hardware that can be carried easily from one place to another. A hardware wallet's main benefit is that it provides complete anonymity to users that can easy to transact. The users do not necessitate providing their personal information to the wallet, so there is no risk of data or information getting leaked.
The hardware wallets are external devices, so these are vulnerable to malware. If you mistakenly lose your device or it gets attacked, you might not recover your coins.
Another protected way of storing the bitcoins is through a paper wallet. There are least chances of a paper wallet being attacked because it is a document that can never be stolen. The users need more advanced knowledge to understand the working of digital currencies. The paper wallet is generated using the dedicated websites, and the private keys of this wallet are in the form of a QR code.
To complete the transactions, users can easily scan the QR codes and make the payment. This kind of wallet is for people who want to store a small number of bitcoins in their wallets and regularly carry out transactions.
Desktop wallets are the wallets that can only be operated on computers. These types of wallets are known as “cold storage” wallets. The desktop wallet needs to be downloaded and installed on computers. There are a plethora of advantages of using a desktop wallet. The best benefit is that these can be from any part of the world, but these are also immune to cybercriminals and theft.
The desktop wallets must be secured by protecting the private keys. Users need to protect their wallet using security measures to prevent the wallet from getting infected with viruses or malware.
Some Security Precautions
• The bitcoin wallet users must back up their wallets. It might be possible that the computer fails or anything happens to your computer. In such cases, the only way to get your bitcoins recovered is through a backup created. The users must back up all the wallet files and store them at different secured locations that are only accessible to bitcoin owners.
• The users must keep their software everything. If you want are not up-to-date and don't have antivirus software, it might be easy for hackers to attack your wallet. To ensure the safety of the wallet, it is important to keep the software updated.