Best Cryptocurrency Exchange

4 Crypto Exchanges That Keep Your Bitcoin Extra Safe

4 Crypto Exchanges That Keep Your Bitcoin Extra Safe
Written by publisher team

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All cryptocurrency exchanges say their security is top notch, but don’t just take their word for it. Read on to find out what additional security measures to look for.

When you buy cryptocurrency, it is important that you do so safely. This is because this is still a new and relatively unregulated industry. While almost all bank or brokerage accounts have insurance and other types of protection to keep your money safe, the same cannot be said for cryptocurrency exchanges.

Some notable stock exchange hacks have shown how easy it is to lose your money. One such example is Mount Gox. In 2014, about 850,000 bitcoins were stolen, valued at about $450 million at the time. Less than a third of them have since been recovered.

This is one of the main reasons why security is often a major concern when buying cryptocurrencies. If you are planning to invest in cryptocurrencies, it is a good idea to make sure that you use an out-of-the-way exchange to protect your investment.

Most of the large cryptocurrency exchanges have good security software. User-level protection such as two-factor authentication (2FA) is pretty standard. When you activate two-factor authentication (2FA), you will need to provide additional information whenever you log in, such as a code you receive via SMS.

But users should look for an exchange that will go the extra mile to keep their bitcoins and other currencies safe. Here are three additional security measures to look out for:

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  1. insurance: When you put money into a bank account, it’s usually insured by the Federal Insurance Corporation (FDIC), which protects it from theft or bank failure. Cryptocurrency exchanges do not have FDIC insurance. But exchanges that take security seriously provide additional insurance for your cryptocurrencies. This way, if it is stolen from the exchange, you may be compensated.
  2. cold storage: Exchanges need to keep some The currency is in so-called “fast storage”, which means that it is online and accessible. Security-wise, you want an exchange that keeps the majority of assets in cold storage. This means that it is offline, often broken, and physically difficult to access.
  3. Bug bounty program: The idea of ​​bug bounties is to encourage independent security experts – also called ethical hackers – to find system vulnerabilities. Exchanges offer bonuses so that people report security vulnerabilities instead of exploiting them to steal your crypto.

Here are four of the best cryptocurrency exchanges that go the extra mile:

exchange

insurance

cold storage

bug bonus

Twins

Gemini says it has $200 million in crypto insurance coverage. It also secures coins in cold storage and allows customers to purchase additional crypto insurance.

Most coins are kept in cold storage

Yes

Queen Piece

Coinbase says it secures all coins in hot storage.

98% of coins are kept in cold storage

Yes

Robinhood

Robinhood says its assets are insured by Lloyd against losses, including theft.

Most coins are kept in cold storage

Yes

Crypto.com

Crypto.com says it has secured a total of $360 million in cold storage insurance against physical damage or destruction and third-party theft.

100% of the user’s cryptocurrency is kept offline in cold storage

Yes

Sources: Gemini, Coinbase, Robinhood, Crypto.com

For more security, use cryptocurrency wallets

Keep in mind that even if you are using a super-secure exchange, for extra protection, you should look into cryptocurrency wallets.

If your cryptocurrency private keys are stolen, it will be nearly impossible to recover your money. The safest way to protect your digital currency is to use a cold wallet. This is a piece of hardware that you buy and keep offline, so it’s nearly impossible to hack.

Since cold wallets are offline, you will not be able to easily access your crypto. On the other hand, a hot wallet is a web, mobile or desktop based wallet. It is a good choice for the currency that you want to access more easily. It’s not as safe as a cold wallet, so you only want to store a small amount that you plan to use regularly.

There are a lot of risks involved in buying Bitcoin or any other digital currency. This is why it is a good idea to protect yourself and look for an exchange with insurance programs, cold storage, and bug bounty. If you do, you can be absolutely confident that you are doing everything to keep your assets safe.

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