This post will guide you on the best practices for holding multiple cryptocurrencies.
The Cryptocurrency world is riveted with high volatility as it sometimes suffers from a prolonged bearish market, as witnessed all through 2018 and the early parts of 2019.
In preparing for the next cycle of a bullish market trend, you might want to store multiple cryptocurrencies in the hope that they make a massive jump in value when the market begins showing a strong bullish trend.
Best Practices For Holding Multiple Cryptocurrencies
Use different Wallets to store multiple cryptocurrencies
Hardware or paper Wallets are cold (offline) wallets best for storing cryptocurrencies for an extremely long duration of time.
Paper wallets store your private keys on paper. If you’re using paper wallets, keep your printout in a safe and secure place accessible to you only.
Hardware wallets store private keys in USB devices. If you’re using a hardware wallet, you should buy hardware wallets that support multiple cryptocurrencies only from the manufacturer because buying from third-parties is unsafe. Also, you should initialize and reset your hardware wallet yourself. Examples of hardware wallets are Keepkey, Nano, Trezor, etc.
Use two-factor authentication (2FA) to protect your hot (online) wallets
2FA uses an additional security layer to protect your online wallet from cybercriminals who might want to gain forcible access to your online wallets. A 2FA authentication will require that you provide a code sent to your phone number in addition to providing the right password before gaining access to your wallet.
Use strong passwords for your cryptocurrency wallets
For your cryptocurrency wallets, you should use different passwords for different wallets. Also, your passwords should be strong, consisting of upper and lowercase letters, numerals, and special symbols to make it extremely difficult for hackers who might want to hack your account using intelligent hacking tools.
Use the ‘copy’ option to copy your public keys when sending or receiving cryptocurrencies from wallet to wallet
Copying your private keys manually increases your chances of making typographical errors. This can cause you to lose your cryptocurrency. Therefore, always use the copy and paste option to avoid typo errors. Also, verify that you’re copying the right private key before proceeding with your transaction.
Avoid holding your cryptocurrencies on exchange wallets for long
Exchange sites are frequent targets for hackers. More than $11bn worth of cryptocurrencies have been lost to hackers. For this reason, you shouldn’t hold your coins for long on exchange sites. Instead, it would be best if you had different wallet types for holding your cryptocurrencies.
Likewise, avoid holding a large number of cryptocurrencies online. A bulk of your cryptocurrencies should be stored in cold, hardware wallets for safekeeping. If you must hold a large number of crypto coins online, you should consider spreading your assets in multiple online wallets that require you to perform KYC for extra security measures.
Permit login only from authorized devices
Enabling this setting alerts you and your wallet provider to suspicious login activities from unauthorized devices. Hence, your wallet provider can take appropriate steps to keep your wallet safe and secure from hackers.
In the wake of a bullish market trend for cryptocurrencies, you should take extra security measures to keep your cryptocurrencies safe. Remember, the safety of your cryptocurrency remains your sole responsibility.