Crypto Security: How to Protect Your Digital Assets

Security is paramount in cryptocurrency. Unlike traditional banking, you're responsible for protecting your assets. This guide covers essential security practices.

The Golden Rules

Not your keys, not your coins - Self-custody is true ownership

Never share your seed phrase - No legitimate service will ever ask

Verify everything - URLs, addresses, contracts

Assume you're a target - Practice defense in depth

Wallet Security

Wallet Types

Type

Security

Convenience

Best For

Hardware	Highest	Low	Long-term storage
Desktop	High	Medium	Active trading
Mobile	Medium	High	Daily spending
Exchange	Varies	Highest	Frequent trading

Hardware Wallets

The gold standard for security:

Recommended Devices:

• Ledger Nano X: Bluetooth, wide coin support
• Trezor Model T: Touchscreen, open-source
• Coldcard Mk4: Bitcoin-only, airgapped
• Foundation Passport: Open-source, elegant

Best Practices:

• Buy directly from manufacturer
• Verify package seals
• Never enter seed phrase online
• Update firmware regularly
• Use a passphrase for extra security

Seed Phrase Protection

Your 12 or 24-word seed phrase is the master key:

DO:

• Write on metal plate (fire/water resistant)
• Store in multiple secure locations
• Consider splitting (Shamir's Secret Sharing)
• Use a passphrase (25th word)
• Keep offline permanently

DON'T:

• Store digitally (no photos, no cloud)
• Share with anyone ever
• Enter on websites
• Store with hardware wallet
• Use pre-generated seeds

Metal Backup Options

Product

Type

Price

Cryptosteel	Tiles	$80
Billfodl	Tiles	$70
Blockplate	Stamp	$60
SeedSigner	DIY	$50

Exchange Security

If you use exchanges, minimize risk:

Account Protection

• Strong password: 20+ characters, unique
• 2FA: Hardware key (YubiKey) > Authenticator app > SMS
• Whitelisted addresses: Only allow withdrawals to known addresses
• API restrictions: Limit permissions, use IP whitelist

Choosing an Exchange

• Proof of Reserves (audited)
• Long track record
• Insurance funds
• Regulatory compliance
• Security history

Common Scams

Phishing

What: Fake websites, emails, DMs asking for credentials Defense:

• Bookmark official sites
• Never click links in DMs
• Verify URLs character by character
• Use browser extensions like PhishFort

Fake Support

What: Impersonators offering "help" in Discord/Telegram Defense:

• Support will NEVER DM first
• Never share screens
• Never share seed phrases

Approval Scams

What: Malicious contracts drain your wallet Defense:

• Review all approvals before signing
• Use revoke.cash to check existing approvals
• Revoke unused approvals

Airdrop Scams

What: Fake tokens in your wallet lead to phishing sites Defense:

• Don't interact with unknown tokens
• Never "claim" unsolicited airdrops
• Hide spam tokens in wallet

Rug Pulls

What: Developers abandon project with investor funds Defense:

• Research team (doxxed?)
• Verify liquidity is locked
• Avoid new/unaudited tokens
• Never FOMO

SIM Swapping

What: Attackers port your phone number to steal SMS 2FA Defense:

• Use authenticator apps, not SMS
• Set carrier PIN
• Consider Google Voice for crypto accounts

Transaction Safety

Address Verification

• Always copy/paste addresses
• Verify first AND last 6 characters
• Send test transaction first for large amounts
• Use address book features

Contract Interactions

Before signing any transaction:

Read what you're approving

Check the contract address

Verify on block explorer

Use simulation tools (Tenderly, Fire)

Revoke Approvals

Regularly clean up token approvals:

• revoke.cash
• Etherscan Token Approvals

OpSec (Operational Security)

Digital Hygiene

• Dedicated device for crypto
• Separate email for exchanges
• Password manager (1Password, Bitwarden)
• VPN for public networks
• Keep software updated

Physical Security

• Don't discuss holdings publicly
• Use a PO Box for hardware wallet delivery
• Secure your home if holding significant amounts
• Consider decoy wallets

Social Engineering Resistance

• Assume all DMs are scams
• Verify identities through official channels
• Don't discuss holdings publicly
• Be skeptical of "urgent" requests

Recovery Planning

What If You're Incapacitated?

Create a plan for inheritance:

Document your setup (without exposing secrets)

Create instructions for trusted parties

Consider multi-sig (2-of-3 with family members)

Use inheritance services (Casa, Unchained)

If You're Compromised

Act immediately:

Transfer assets to new wallet

Revoke all approvals

Change passwords everywhere

Enable additional security

Document for potential investigation

Security Checklist

Basic (Everyone)

• [ ] Hardware wallet for significant holdings
• [ ] Seed phrase on metal, stored safely
• [ ] Authenticator app 2FA on all accounts
• [ ] Unique passwords for every service
• [ ] Verified bookmarks for all crypto sites

Intermediate

• [ ] Hardware security key (YubiKey)
• [ ] Dedicated device for crypto
• [ ] Multi-signature setup
• [ ] Regular approval revocations
• [ ] Passphrase (25th word) enabled

Advanced

• [ ] Air-gapped signing device
• [ ] Geographic distribution of backups
• [ ] Corporate structure for large holdings
• [ ] Regular security audits
• [ ] Formal inheritance plan

Conclusion

Security is not a product but a process. Start with the basics, build good habits, and continuously improve. The crypto space is adversarial - assume attackers are sophisticated and patient.

The peace of mind from proper security is worth the effort.

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