What You Should Know About Bitcoin’s Security
Many people on hearing about Bitcoin for the first time are concerned about its safety. Since there is no government regulatory agency or company to ensure the functioning of the Bitcoin network, how to know that things are done correctly and what security measures should we take? Analyzing the Bitcoin from the security point of view, there are some important issues that we must address. In this article, we will list the items that you should observe when you are with your Bitcoins in your Bitcoin wallet. We'll also take a closer look at your account in a Bitcoin Exchange which is used to buy and sell Bitcoins.
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Security in Bitcoin conversion to other currencies (exchanges)
To sell Bitcoin in other currencies or to buy Bitcoins, the most common way is to use an Exchange. These exchanges are sites where you create an account. The next step could be a Bitcoin transfer from your wallet to its wallet. You could also make a transfer from your bank account to the Exchange bank account. Like any account anywhere, you must create long and complex passwords to increase your security. When the funds are transferred and loaded into the Exchange, you can make the trades you want. Because there are sites that have a lot of money stored, these exchanges are always targets of hacker attacks. Although they are protected against these attacks, this makes money there more vulnerable than within your Bitcoin wallet. Thus the recommendation is that you shouldn’t keep your money (or Bitcoin) too long in this Exchange. Make your trade and then transfer the money to your own Bitcoin wallet or bank account in a traditional bank.
Security of your Bitcoin wallet
When you store the Bitcoins you have, there are procedures that must be taken into account to ensure your safety. All Bitcoin that you have is on your hands only when it is in your Bitcoin wallet. There are online wallets which rely on central servers, so be careful with them. If you keep your Bitcoins in your account in Exchange, they are in Exchange wallet and they may be at risk of any attacks or malpractice mentioned above.
When you create a wallet, it usually has a backup file. It is important to save this file in a safe place and always create passwords for access, whether to that file, as for your own wallet. Most wallets have mobile apps. If your phone is stolen, you must act quickly to load up your wallet in another location and change all passwords. Do this to ensure the security of your Bitcoins.
There are also offline wallets. They are usually some kind of hardware and look like a pen drive, or they come in a paper form. They are the best fit to store your Bitcoins in a way totally disconnected from the Bitcoin network. Be careful where you keep them and make sure to create passwords that you can remember, otherwise, you can lose access to Bitcoins. They will continue inside these wallets, but you'll not be able to use them because you do not know the wallet password or address.
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