Cryptocurrencies have brought many exciting possibilities, but they are also fraught with risks and dangers for the inexperienced. Follow the three main security principles outlined below to mitigate some risks associated with holding, using and trading cryptocurrencies.

Maintain your privacy

Thanks to the nature of the Internet, information can spread very quickly, and sometimes in undesirable directions.

There are plenty of people with malicious intent who employ nefarious tactics in an attempt to steal your cryptocurrencies. Most threats and attacks are generally targeted and operate like a network: they try to catch everyone naively and sufficiently distracted, but not necessarily a specific person. However, if you unintentionally become a target by revealing sensitive information, more sophisticated and targeted attacks are possible.

Is recommended:

• Consider the risks of bragging about your successful trades

• Do not share your previously used addresses.

• Be careful when mentioning your balances.

• Avoid sharing information that is connected to your identity offline

• Use encrypted communication channels.

Think long term. Those few satoshis in your addresses can be worth much more in the years to come. Or not. You can even get rid of your cryptocurrencies in the meantime. But does it matter? A potential attacker, distant relatives, or simply jealous strangers and acquaintances may not receive the memo in time.

Protect yourself

Users of both the traditional banking system and cryptocurrencies are often victims of similar scams and frauds. However, with cryptocurrencies, several factors are driving the burden of responsibility on the shoulders of the end user, primarily a lack of inherent trust and immutability of the transactions processed.

Banks, considered trustworthy entities, have full custody control of your money. Banks are regulated and communicate with each other, making it easier to prevent and combat fraud. If you are a victim or make an honest mistake when transferring money from your bank account, you can usually request a chargeback. In cryptocurrencies, once transactions propagate to the network and are confirmed, they are irreversible.

You have to be alert. Learn about common phishing tactics, find out what keyloggers are, and learn about common threats outlined in Binance Academy. Familiarizing yourself with these dangers will help you keep your coins safe.

Using strong, unique passwords and enabling 2FA protection for your online accounts should be the first step to improving your overall security.

You shouldn't forget to protect yourself against yourself too because you are (probably) human and people make mistakes. Making a typo when creating your backups, sending your tokens to the wrong address, or simply making the wrong decision can compromise your security and cause a lot of inconvenience.

'Measure twice, cut once' goes the proverb that many of us heard from our parents. When it comes to using and protecting cryptocurrencies, it is becoming more and more relevant.

Be your own bank

To ensure the availability of your coins and maximize your security, it is recommended to keep your private keys offline. Although exchanges are generally much safer than ever, it is still recommended to hold substantial amounts in exchange accounts only if you are an active trader. Also, like money in a bank account, unless you own and have exclusive access to your private keys, you cannot claim ownership of your coins and a promise remains.

For the first time in history, you have the opportunity to own a digital asset in the same way you own physical money or a piece of precious metal. Unlike these other forms of assets, you can back up your cryptocurrencies to a piece of paper and gain access to your possessions securely anywhere in the world.

Of course, maintaining and protecting these keys to your cryptocurrencies comes with many dangers, as noted in the section above. Fortunately, there are tools ready to help you keep up with these challenges and allow you to take advantage of all the benefits of these new technologies.

The types of cryptocurrency wallets designed to store your private keys vary in security, ease of use, number of use cases, and even availability. Consider your options and choose the type that best suits your needs.

Software and mobile phone wallets offer a wide variety of features and are generally very easy to use. The big disadvantage from a security point of view is that they are connected to very complex and often online environments, such as your mobile phone or a computer. These factors open many opportunities for viruses and hackers to access your coins; therefore, inexperienced users should only use them for small amounts of cryptocurrency.

Paper wallets, which contain your private keys written on a piece of paper (or etched on a metal plate) are often considered one of the most secure ways to store private keys. However, they are quite difficult to handle and are generally only viable for a single use.

Hardware wallets are usually best for balancing ease of use and high level of security. These pocket-sized devices protect private keys from malware and hackers by keeping them offline, but they'll cost you between $70 and $200, and require physical confirmation for most actions.

Remember, security is never absolute and complete. Take the time to update your knowledge base from time to time and check for potential weaknesses regularly.

This article was provided by Trezor.io