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The 8 Best Ways to Protect Your Crypto Investment

Do you love investing in crypto? If so, you have likely accumulated a nice little nest egg for yourself and for your family. But as you know, with every nest egg comes the worries of how to protect it.

No matter where you are in your crypto journey, there are some things you need to know about keeping your investment safe. Keep reading to learn 8 ways to best protect your cryptocurrency.

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1. Get a Cold Wallet

While software, aka hot wallets attached to platforms, are convenient and easy to use, they are also much riskier than a cold wallet. Cold wallets are safer as they aren’t associated with a particular platform, and your crypto is stored offline, making it much more difficult to hack. Plus, you won’t lose your investment if the website goes under.

The best cold wallets are Trezor and Ledger, neither of which will cost you an arm or a leg.

Related: Cryptocurrency Storage Safety Basics in 4 Minutes

2. Don’t Share Your Password

Continuing on that thought, all cold wallets come with a seed phrase that is used to access your cryptocurrency on the device. Because that seed phrase is the only password, you need to make sure you don’t share it with anyone, as it will give them the power to access your crypto.

3. Save Your Password Somewhere Safe

That being said, while you shouldn’t share your seed phrase, you do need to come up with some way to keep it safe. Writing it down can leave it liable to be stolen or lost, and keeping it stored in an online account can leave you vulnerable to hacks.

We recommend, if you do write down your seed phrase, that you store it somewhere safe, like a safe deposit box or an actual safe, where it is password protected from intruders.

While we don’t recommend storing it online, storing it in an open-source offline password storage app where it is password protected can add an extra layer of security for those who can’t afford a safe deposit box.

4. Approach Crypto Opportunities With Caution

Once you own some crypto, it is likely you will be approached with investment ideas by various parties. While some of these are legit opportunities, most are not, and they are simply individuals who are trying to steal your cryptocurrency.

First and foremost, if an opportunity seems too good to be true, it is, just walk away. Additionally, any viable opportunity should allow you to invest on your own without the individual who told you about the opportunity being involved. If they insist they are the only ones who can invest your money for you—run.

Beyond the above, always vet any opportunity you are presented with. Just because you can invest your money on your own on a platform doesn’t mean it’s safe. The platform itself may have vulnerabilities, or it could be a rug-pull scheme—meaning the creators will disappear with your money once they have your investment.

Related: How to Avoid the Social Media Fake Crypto Scam

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5. Avoid Common Investor Pitfalls

A lot of anxiety and uncertainty comes with holding cryptocurrency. It can be tempting to sell your crypto the minute it drops a little bit, or scary when it drops a lot, and it feels too late to sell.

Much of these dips and peaks are normal in the investing world, and you need to educate yourself so you know when to ride something out or when to abandon a hopeless endeavor. Specifically, learn about the day-trader mentality and some of the pitfalls major traders like George Soros and Richard Dennis are able to avoid.

It can help to find a mentor who also invests in crypto, and to listen to their advice and suggestions. But remember, unless they are Satoshi Nakamoto, they don’t know everything and anything they advise you to do should be researched before you act on it.

6. Have a Zero Day Plan

Of course, we hope that everything is going well in your life and that your crypto can continue to grow undisturbed, but there may come an emergency someday when you need to withdraw it.

Withdrawal of a cryptocurrency investment isn’t as easy as a fiat investment. You need to have a plan for paying any capital gains taxes you owe, as well as a platform where you can exchange your crypto for fiat for divestment.

Many of the exchanges that allow this sort of thing, require waiting periods for signup and KYC verification. As such, they should be set up far before you think you’ll need them, so you can avoid a delay if a true emergency arises.

7. Hold Multiple Cryptocurrencies

There is an old saying that you shouldn’t keep all your eggs in one basket, and the same goes for crypto. While you should choose a favorite cryptocurrency, it is a good idea to invest in one or two others. That way, if your preferred cryptocurrency platform goes under, you’ll still have something left.

That being said, you don’t want to diversify too much either, because then you won’t reap the rewards of investing. Most seasoned investors suggest multiple investments,  but focusing on only two or three until you are a seasoned investor.

8. Keep Your Cold Wallet Safe

Last but not least, once you have a cold wallet set up and the password stored safely, you need to store the cold wallet safely, too. The last thing you want to do is lose the small device with all of your investments on it.

We recommend investing in an in-home safe, in order to keep your cold wallet and password safe. Of course, a safe deposit box could also work, but don’t store your cold wallet and password in the same safe deposit box, because if you forget a payment one month, the bank could auction it off to the highest bidder—causing you to lose everything.

Overall, we hope these tips and tricks have helped you to learn how to protect your cryptocurrency investment. Be sure to follow our blog here on to learn more about cryptocurrency, investing, and gaming, all in one convenient place!

You May Also Enjoy: 10 Essential Security Tips for Safeguarding Your Crypto

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