Protecting a Crypto Wallet

Protecting anything on a computer is difficult, especially a crypto wallet. You will need to think about it in two parts:

1. Source Phrase. The original phrase should never be stored digitally as an image or text on a computer or mobile device. The phrase is equivalent to your wallet and anyone with it has full control of your wallet. It is best to write it down on paper (or metal) and keep it in a safe place in the real world.

2. Private Key: You will never need direct access to your private key. Your private key is stored in your wallet app, and your best defense is to choose a well-known key. MetaMask is a popular browser extension app and Trezor is a popular hardware wallet app.

Recommended approach to protecting your wallet:

The risk of wallet theft increases the more you use it. For this reason, we recommend using at least a dual wallet system, with a hot wallet used for day-to-day transactions and a cold wallet for long-term storage of your cryptocurrencies.

Hot Wallet

Your hot wallet should not contain a lot of cryptocurrencies. Therefore, you should only have enough cryptocurrencies for purchases and only cryptocurrencies that you recently purchased or plan to sell. This is your everyday wallet that you can afford to lose.

Cold wallet

A cold wallet is one that you don't have easy access to. It could be a hardware wallet, but it could also be a software wallet that is stored on paper in a safe deposit box, or a laptop that is only used when you need to interact with your cold wallet. This wallet should hold all of your valuable items and any significant amounts of cryptocurrency.