Cryptocurrency trading can be profitable, but it also has the potential to lose you money quickly. When you first get started, it might not seem like it, but every trade you make is a major risk. This is why traders keep a trading portfolio separate from their primary assets and investments. The primary assets should only be used for day-to-day expenses and normal spending.
Crypto trading is still new enough that many people aren’t ready to fully expose their finances to the risks of trading. For example, most banks are hesitant to offer cryptocurrency services because they aren’t sure how it will affect their customers’ balances in the long run. This means that you shouldn’t expect your bank or other financial institutions to trust you with their money either. That being said, there are still plenty of precautions people can take when planning on getting into cryptocurrency investing. Here are some basic ways to protect your cryptocurrency investment portfolio:
Create an offline cryptocurrency wallet
This is by far the most important thing you can do to protect your trading portfolio. For one thing, you don’t want to accidentally lose access to your wallet by losing your computer or phone. Also, many major Cryptocurrencies are now recommended to be stored offline. This means that hackers can’t steal your coins by breaking into your online wallet. So, the best thing you can do is create an offline wallet. There are a variety of ways to do this, but the most important thing is to always store your keys offline. This means that there’s no way for hackers to access your coins.
Report suspicious activity to your exchange
When you first start trading Cryptocurrencies, you might be tempted to try to earn a little extra cash by manipulating the market. Unfortunately, this is a major red flag that can get reported to your exchange. Many exchanges are now partnered with cyber-security companies that can detect this type of manipulation. So, if you see suspicious activity on your Bitcoin Smarter exchange, report it. This might cause your exchange to suspend your account until they can investigate.
Always back up your computer
This is one of the most obvious things you can do to protect your investment portfolio. Backing up your wallet is essential. It’s one of the only ways you can guarantee that you’ll have access to your coins if something happens to your computer or phone. You can back up your wallet on any computer or an external hard drive. You can also use a cloud storage service like Google Drive, OneDrive, or Dropbox. Make sure to back up the wallet file and the private keys.
Don’t share your wallet address with anyone
This is another very important tip that everyone should follow. When you want to receive cryptocurrency, you need to share your wallet address with the person you want to send coins. This is also very important because it means that if someone were to steal your coins, they’d need access to your wallet address to transfer it. With this address, there’s no way to track them down. There are a few ways that you can share your address without worrying about anyone stealing your coins. You can create a Paper wallet with a private key. You can also use a cryptocurrency exchange’s external wallet.
Sandbox your trading account
When you first start trading Cryptocurrencies, it’s a very good idea to keep your trading portfolio in a “sandbox” account. A sandbox account is a new account that has a small amount of Bitcoin or Ethereum in it. This way, if you lose money, it won’t be too hard for you to lose more money. This is why most people start with a small amount in a sandbox account. It’s a good idea to start small with a $10–$20 trading account and gradually increase the amount you trade as you continue to learn. There are a few different ways to do this. Some people like to use sites like Coinbase or LocalBitcoins to find people willing to trade small amounts.
Cryptocurrency investing can be exciting, but it comes with a lot of risks. This is why it’s essential to create an investment portfolio that’s protected from those risks. The best way to do this is to create an offline cryptocurrency wallet. This will keep your coins safe from anyone who might try to steal your laptop. Most importantly, you should never share your wallet address with anyone. Now that you know how to protect your investment portfolio, it’s time to start investing in cryptocurrency!