Although trading Crypto is now commonplace there are still people wondering whether it trading Crypto is safe. It is worth reading up and doing some research, possibly reading up on a Crypto buying and trading guide to give you an idea how of how to buy Bitcoin and what trading it means.
In the meantime, here is a quick look at Cryptocurrency and just how safe it is to trade.
Crypto’s are always in the news with their highs and lows – although recently there have been much greater gains than losses. It is worth keeping in mind that digital currency does in general remain volatile high risk investments; heavily influenced and affected by the media and the general mood of the market.
To date, Crypto’s are unregulated. This means they are not controlled by banks or regulated by governments. They are not a mainstream currency yet. There have been discussions as to what they might be classified as – possibly as virtual commodities rather than a currency. But as yet, they remain unregulated and that is something to be aware of.
The answer to whether trading Crypto’s is safe will often come from what you are expecting from Crypto’s. If you are sensible, take the time to fully research and understand the risks of trading Crypto’s. Take professional financial advice before starting to trade. Only invest what you are prepared to lose and then only if you feel you have the experience and skill to manage your trades and investments. Cryptocurrency trading may not be safe for everyone but is a valuable tool in an investor’s armoury.
Can I hold my own Crypto?
Crypto is generally stored in electronic wallets. Within the wallets are stored the electronic keys to your Crypto’s. There have been a number of news stories in recent years over the security of these wallets. In reality the number of issues is small compared to the volumes of trading being passed through these wallets.
Nevertheless, the safest wallet for Crypto remains one that is described as a cold wallet and is disconnected from the internet. These cold wallets, though less easily accessed remotely by the user are by the same token, disconnected from hacking threats. Usually these wallets take the form of a USB flash memory stick
Most Crypto that is being traded is held in hot wallets. As this is connected to the internet this does bring a weakness and owners of Crypto’s can store their Crypto’s safer in other ways when not currently being traded.
A final type of Crypto wallet is the paper wallet. This is a very secure system where you use a web service to generate your wallet and keys in a printable form. This printed wallet and keys may then be stored conventionally, in a home safe or safety deposit box at a bank or building society. This system, though of increased security, has the most involved of all methods of releasing your Crypto’s for trading.
You should regularly back up your wallet to a number of separate locations. For example, a couple of USB sticks stored away from each other and also a backup copy on the hard drive. Whatever you do, make sure you use a password protected computer for your Crypto trading!