If you’ve been in crypto long enough, you probably understand how important security is. You don’t need to make unprofitable trades to lose money in this space; a few wrong clicks can easily drain your wallet.

And it does not matter whether you are a newbie or a crypto native. People from both of these categories lose money because of security negligence daily.

As crypto hackers become more sophisticated, I want to go over security fundamentals that we all need to remember.

Never store your money on centralized exchanges

I’ve been in crypto for over four years now, and I learned that lesson the hard way.

I lost over 50 ETH storing my money in a centralized exchange (after it was hacked) back in 2018. Since then, I prefer to store most of my holdings in a cold wallet. That doesn’t mean I don’t use centralized exchanges. I continue to use them. I just don’t hold most of my money there.

The funny thing is that not that long ago, AscendEX was hacked for $77 million, and I also had some money there. Although the team behind the exchange announced that it would reimburse everything, now my money is stuck there for an unknown time.

In crypto, we are responsible for our security. If you transfer that responsibility to a third party, the chance that something will go wrong is pretty high.

You cannot trust anyone, even big crypto exchanges like Binance and Coinbase. As with every other IT service, they can also get hacked, and you could lose your money.

So if you still don’t own a cold wallet yet, buy one and learn how to use it. It can help protect your funds.

Messages on telegram or discord with a “great” offer is a scam

Every day I join multiple Telegram and Discord chats related to crypto. And daily, I get multiple attempts to scam me on social media.

Most of these scammers are trying to offer a way to “easily make money.” The more sophisticated ones will pretend like they are customer support for a project and send you a link that you will need to connect your wallet.

Do you know what happens after? Your wallet will be drained.

So do not trust people that message you directly on social networks. Projects don’t offer customer support in personal messages on Telegram.

Also, be careful with websites that you connect to your Metamask. A wrong connection might be costly to your portfolio.

There is no free launch on Opensea

While many of you might think NFTs are safe, I will surprise you that they are not.

Hackers send malicious NFTs as “a free gift” to NFT collectors. When users interact with such NFT on Opensea, guess what happens? Your wallet gets drained.

Opensea has bugs that hackers continue to exploit. Read more about it here.

The best course of action, if you received such a “free” NFT, simply do not touch it.

The only free cheese is in the mousetrap.

Final thoughts…

Ideally, to feel secure, you should have a cold wallet (Ledger, Trezor, or any other) and a hot wallet. Store all the funds in your cold wallet. For all the other activities, use your hot wallet.

This way, even if you get scammed, you will not lose it all.

So, stay safe, and be mindful of your wallet security.

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Our research team at SIMETRI is also constantly sharing alpha. So feel free to follow me: Alexander Mardar, and my colleagues: Anton Tarasov, Sergey Yakovenko, and Nivesh Rustgi.