This is the first of my series in Bitcoin and Cryptocoin safety and security. I see a lot of people are new in the Cryptocurrency sphere so I want to put together everything I know about using Cryptocoins safely and securely. Hope this is useful for some of you. Enjoy!
Bitcoin Safety and Security Primer - Part One
By the end of 2017 almost every Internet user had heard about Bitcoin in one form or another. The price increases that usually attract people had been all the rage last year alone as Bitcoin zoomed past the $10,000 price. However there are also some negative news that have scared people away from adopting this technology/investment. There have been news and reports of negative experiences of people getting their funds lost or stolen. Since Bitcoin is a valuable digital commodity it is to be expected that there are going to be bad actors who will attempt to exploit software security vulnerabilities for Bitcoin services and most especially the exploitation of unwary Bitcoin users.
One thing that every new comer to Bitcoin must fully grasp and understand is that the actual Bitcoin code itself is very sophisticated and nearly impossible to hack. There have been false claims in the past that Bitcoin, the technology itself, is vulnerable to hacking but as we can now witness, with the price of Bitcoin being at $10,000 per digital coin, that argument goes out the window. The markets have agreed that Bitcoin is a very safe and secure form of value that has worked very successfully in the last 9 years, since it was created, as a form of exchange in today's digital currency landscape.
This primer won't be covering how Bitcoin's code works to secure your actual coins. The technology behind Bitcoin has proven with time that it is very secure and nearly 100% hack proof but we recommend you take the time to read how Bitcoin really works under the hood so that you can see and understand for yourself how secure Bitcoin as a currency really is. (Hint: encryption, distributed ledger, etc)
Recommended reading: Read the top Bitcoin Myths and Misconceptions
Protect Your Crypto Coins like Cash!
As with any new technology, early adoption can result in unmitigated risks and losses. Those of us who followed Bitcoin very early on witnessed the early problems with Bitcoin related services where people lost a lot of their money due to fraud, scams, hacks, and so on. (see MtGox)
Bitcoin was designed to act like a physical currency. Think like holding actual Gold or physical cash in your hand. That money is solely under your responsibility and yours alone, since Bitcoin doesn't have a bank or banking system it is your responsibility to secure it. If you wanted to secure your physical gold or cash you would most likely put it in a safe somewhere in your house right? That would make the most sense after all. Bitcoin is a Libertarian's dream and with it comes the realization that if anybody tried to rob you, having a self defense weapon is equally important in further protecting your personal wealth. But it seems that with Bitcoin, and other Cryptocurrencies, a lot of people aren't fully aware on how to go about protecting this newfound digital gold.
Treating it like Cash is King!
Unfortunately most people still do not know how to begin using Bitcoin safely and securely. Bitcoin isn't just another form of currency, it is a new financial technology that allows every individual to become his or her own bank. So in a sense, the responsibility of securing your crypto currency relies on yourself and only yourself as there is no organization, bank, institution, or government agency that will safeguard your Bitcoin to prevent theft, loss, accidental erasure, etc. This is perhaps the most important thing for anybody that is new to Bitcoin to understand. It is wise to treat your Bitcoin's like physical cash and that at any moment it can be subject to loss or theft if the user isn't taking the necessary precautions. It is your responsibility to find ways to safely and securely store your bitcoin either on your smart phone, computer, or through other mechanisms such as "paper wallets" or "hardware wallets" and even "brain wallets". Don't worry if you do not understand some of these terms as we will cover them in detail in the future but it is my goal to help you understand how to go about protecting your Bitcoins safely and securely using any of the methods available.
In the next article I will explain in more detail some basic Bitcoin terminology before we start plunging in.