Top 5 Mistakes to Avoid to Protect Your Crypto Assets in the UAE:
Written by: Dr. Zayed Al-Hamri
With the growing interest in digital currencies in the UAE and the world, it has become imperative for investors and cryptocurrency owners to take the necessary precautions to protect their assets. Using digital wallets (Crypto Wallets) is the primary means of storing and managing digital currencies, but there are common mistakes that can put your assets at risk. In this article, we will highlight the top 5 mistakes to avoid to protect your digital currencies.
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1. No Backup
This is one of the most common mistakes that can lead to the permanent loss of your digital assets. When you set up a digital wallet, you are given a recovery phrase or private key that is usually 12-24 words long.
Failure to keep this phrase secure may mean that you will lose access to your wallet if your device is damaged or stolen.
How to avoid this mistake?
• Store your recovery phrase on a written piece of paper and put it in a safe place away from the Internet.
• Do not take pictures of your recovery phrase or save it on your internet-connected devices, as this makes it vulnerable to hacking.
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2. Sharing Private Keys
Your private key is the “secret door” to your digital wallet. Sharing it with anyone means giving them full access to your assets.
Unfortunately, many new users fall victim to scams due to unknowingly sharing their private key.
How to avoid this mistake?
• Do not share your private key with anyone under any circumstances.
• If someone asks you for your key under the pretext of helping, consider this a warning sign of a scam.
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3. Full reliance on hot wallets
Hot wallets are those that are connected to the internet, such as apps or online platforms. Although they are easy to use, they are more vulnerable to hacking because they are constantly connected to the network.
How to avoid this mistake?
• Use cold wallets to store your long-term assets. These wallets are not connected to the internet and provide a higher level of security.
• Only keep small amounts of cryptocurrencies on hot wallets that you use for day trading.
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4. Falling for Phishing Attacks
Phishing attacks are one of the most common ways to steal cryptocurrencies. This is done by sending fake links that appear to be from trusted platforms or wallet providers.
How to avoid this mistake?
• Always check the validity of links before clicking on them.
• Use two-factor authentication (2FA) to protect your accounts on digital platforms.
• Do not enter your personal data or private key on any untrusted site.
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5. Ignoring Security Updates
The technology used in digital wallets is constantly evolving, and companies often release security updates to plug holes and protect users from new threats.
How to avoid this mistake?
• Update digital wallet apps regularly.
• If you are using hardware wallets, check for firmware updates.
• Make sure to download updates only from official sources.
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Additional tips:
• Diversify portfolios: Don't put all your assets in one portfolio. Use more than one portfolio to reduce risk.
• Beware of untrusted platforms: Only deal with well-known platforms and wallets that have a reliable track record in the market.
• Learn more: Take the time to understand the basics of cryptocurrencies and how to manage portfolios safely.
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conclusion
Protecting cryptocurrencies requires full awareness and avoiding common mistakes that can put your assets at risk. It is important to treat your digital wallet as you would your traditional money or even with more care.
By following the tips above and avoiding common mistakes, you can keep your digital assets safe and avoid potentially catastrophic losses.
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