10 Ways to Protect Your Cryptocurrency Wallet Recovery Seed
As cryptocurrencies become more and more popular, there’s one big question on everyone’s mind – how do I store my coins safely? Whether you’re storing Bitcoin, Litecoin, Ethereum, or some other form of cryptocurrency, you’ll want to keep your coins safe from both cybercriminals and natural disaster.
If you’re careful about how you store your wallet recovery seed, you can rest easy knowing that your coins are as safe as possible.
Here are 10 tips for protecting your wallet recovery seed and your cryptocurrency in general.
1) Create offline backups
If you’re not storing your crypto wallet recovery seed online, make sure that it’s somewhere safe and is protected from harm.
Whether you keep your recovery seed in a fireproof box or save it on a cloud-based backup service, never store it in an obvious location where someone could find it.
Remember, if someone has access to your recovery seed, they have access to everything contained within your wallet. If you lose control of your recovery seed, you won’t be able to do anything with any coins contained in that wallet. So, whatever you do—keep those backups safe!
2) Store offline backups in several safe places
It’s always a good idea to keep an offline backup of your crypto wallet recovery seed in a safe place—ideally, one that’s outside your home.
A safety deposit box or fireproof safe would work perfectly. (Note: if you have less than $5,000 in cryptocurrency holdings, it may not be worth buying one just for that purpose.)
You could also store them with your lawyer, who can store them in a bank vault or safe; with another family member or friend who lives far away; or even on an encrypted thumb drive and stored at two different banks.
Of course, for larger amounts of cryptocurrency, you may want multiple copies stored across several physical locations as well as online backup services.
3) Keep a hard copy
Keeping a physical backup of your recovery seed is one of the safest ways to protect your cryptocurrency.
This can be something as simple as writing it down on a piece of paper and tucking it away in a drawer.
If you’re extra cautious, store your recovery seeds in multiple locations so they are not all destroyed at once.
Remember that cryptocurrency wallets are available on just about every device imaginable—meaning that thieves can steal them if they gain access to your phone or computer—so make sure that you don’t store them in these locations if possible.
If no devices have access to your recovery seed, then thieves won’t be able to steal it either.
4) Use an encrypted USB flash drive
One of your best ways to safely store a cryptocurrency wallet recovery seed is by storing it on an encrypted USB flash drive.
An encrypted flash drive helps protect you against common computer threats such as keyloggers and other malware that can steal your information.
There are many easy-to-use encryption programs available, such as VeraCrypt (available for Windows, Mac OS X, and Linux) or Veeam (for Windows). When in doubt, seek out software that’s been around for a while—it’ll likely have undergone rigorous testing and address known security flaws or issues.
Also consider that just because a program encrypts your data doesn’t mean it keeps out other people with physical access to your computer or device; always safeguard your devices in public places!
5) Do it for other valuable information as well
You should also make sure that your crypto wallet recovery seed is stored in a safe place. In many cases, you’ll be able to find it on a piece of paper or on some type of plastic card that contains all of your important crypto wallet information.
It’s important to protect that document so nobody can get access to it and steal your money. Be very careful with what you put inside of a safe-deposit box.
There are some inexpensive locks that are easy to pick, and people don’t always make sure their boxes are secure enough before putting something valuable inside.
If you store something in a bank vault, use a combination lock instead of one where you have to use an actual key—those keys can get stolen pretty easily as well.
6) Generate a passphrase instead of word sequence
if a hacker finds your crypto wallet recovery seed, he or she will have your private key and be able to withdraw funds from your account.
This can make cryptocurrency wallets much safer than bank accounts because even if a bank password is stolen, thieves still can’t access an account without its corresponding security token (e.g., card). But it’s not foolproof.
Hackers could gain access to a crypto wallet passphrase by using malware on an end user’s computer, for example.
If that happens, you might as well forget about your crypto wallet—it won’t have any money in it!
7) Maintain good cyber hygiene
It’s easy for bad actors on a website to record your typing rhythm and hack into your account. Take precautions when entering sensitive information, especially on a public or shared computer.
Use different passwords for each of your accounts and create strong passwords by including upper-case letters, lower-case letters, symbols and numbers (not just words).
Make sure you have enabled two-factor authentication (2FA) on all of your accounts, so that even if someone gets their hands on one password, they cannot access your account without another piece of information (such as a code sent to you via SMS message or email).
Some sites like Google even give you backup codes in case you lose access to other means of 2FA verification.
8) Use secure passwords and PINs
It’s a common misconception that PIN codes are more secure than passwords. In reality, a hacker can easily access your data using brute force methods—all it takes is time and effort.
The safest way to protect your cryptocurrency wallet recovery seed is with a long, complicated password and by avoiding relying on PIN codes.
Instead of entering your password or passphrase, which could leave you vulnerable if someone else sees it, use biometric security options such as voice or facial recognition technology instead.
These methods can also make it easier for you to access your wallet when your hands are full or when you’re on-the-go.
9) Set up two-factor authentication (2FA)
2FA helps prevent your account from being hacked. When you have 2FA enabled, any suspicious login attempts are usually met with a prompt to enter a special code that’s been texted or emailed to you (depending on which platform you use).
This way, even if someone gets hold of your password, they still won’t be able to get into your account without also having access to your phone.
Because cryptocurrency is so valuable, it can be particularly important for users with lots of money invested in crypto assets or transactions taking place.
10) Don’t lose your phone!
This is a simple one, but a very important one. Once you’ve logged into your crypto wallet, write down your wallet recovery seed on a piece of paper (not digitally) and store it in multiple locations so you’ll have access to it in case your phone goes missing or breaks.
This way you can log back into your crypto wallet even if your phone is damaged or lost.
You can also store your recovery seed offline by writing it on a piece of paper that never touches any network connected devices, then storing that piece of paper securely (e.g., in a fireproof safe).
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