The Five Fundamental Rules of Crypto

When trading, transferring and storing cryptos there are five very basic rules everyone should follow.

The problem is, many people don’t. Here are the rules:

[1] — Don’t type the name of your exchange into Google, type it directly into your browser’s address bar.
Reason: there are a lot of phishing sites out there that buy ad space. They set up an ad that looks like one of the popular exchanges but links to a scam site. This site looks identical to the real one, but is set up to record your login details and steal your cryptos. This isn’t some obscure occurrence either. It happens all the time.

[2] — Don’t leave your coins on an exchange.
Reason: when your coins are on an exchange they aren’t really yours at all. They are in the exchange’s wallet. If the exchange gets hacked or goes bankrupt, it can take your coins with it. Again, this has happened many times in the past, with the most notable hack being Mt. Gox.

Mt. Gox: https://en.m.wikipedia.org/wiki/Mt._Gox

[3] — Backup your wallet and test the backup before transferring anything in.
Reason: a cryptocurrency wallet isn’t like an email address or a bank account. No one else controls it except you. This is both good and bad. Good because it gives you privacy and control. Bad because if you lose your backup no one can help you get it back. Your coins are lost forever.
So, when you make a new wallet, download the backup and then try restoring your wallet from the backup to check it works.

[4] —Transfer a very small amount at first to check you have all your addresses right. Only then transfer the full amount in.
Reason: it’s very easy to get addresses wrong because they are just random strings of characters. And if you send your cryptos to the wrong address, they are usually gone for good.
It’s best to find out you got your address wrong when sending £2 of cryptos than to find out when you send £2,000 worth.

[5] — Keep multiple copies of your backups at different physical locations.
Reason: you could get burgled. There could be a fire. You could get flooded. You could even just throw your backup out by mistake. Anything can and does happen to wallet backups, so you need to have more than one.

Be cautious, and happy investing!

C.J.