How to protect your cryptocurrency wallet
4,87
02-10-2025
3944
8 min.
Learn how to protect your crypto wallet and keep it safe. The article covers in detail the main threats to cryptocurrency wallets, protection methods including two-factor authentication, hardware wallets and protection against phishing. Practical tips and recommendations from AML Crypto.
→ Introduction
→ Main Threats to Crypto Wallets
→ Choosing a Reliable Crypto Wallet
→ Secure Storage of Private Keys and SEED Phrases
→ Two-Factor Authentication and Hardware Wallets
→ How to Protect Yourself from Phishing and Fraud
→ Security with DeFi and Web3 Applications
→ What to Do if Your Wallet is Compromised
→ Main Threats to Crypto Wallets
→ Choosing a Reliable Crypto Wallet
→ Secure Storage of Private Keys and SEED Phrases
→ Two-Factor Authentication and Hardware Wallets
→ How to Protect Yourself from Phishing and Fraud
→ Security with DeFi and Web3 Applications
→ What to Do if Your Wallet is Compromised
Get advice from AML Crypto experts
Introduction
With the development of cryptocurrencies and blockchain technologies, securing crypto wallets has become one of the most important topics for users. Since cryptocurrencies are inherently decentralized and not under the control of traditional financial institutions, each user bears full responsibility for the security of their assets when it comes to non-custodial wallets.
A non-custodial wallet is a method of storing cryptocurrencies that gives the user full control over their digital assets. The user has access to the private keys — the secret codes required to confirm transactions. This approach eliminates the need to interact with intermediaries.
In this article, we will discuss in detail how to protect your crypto wallet from potential threats and fraudulent activities. Proper wallet protection includes a range of practices, from understanding the basic principles of blockchain and cryptocurrencies to using specialized tools to defend against phishing and other risks. By reading this material, you will gain practical recommendations to ensure the highest level of security for your crypto assets.
Main Threats to Crypto Wallets
Despite their security features, crypto wallets can still be vulnerable to various threats. The risks listed below should be taken into account by every wallet holder.
Fraud and Phishing. Fraudsters create fake websites and apps that mimic real services. If you connect your wallet to such a site, they may steal your funds by gaining access to your private keys. To avoid this, always check website URLs and use only official sources.
Malware. Viruses and Trojans can infect your computer or mobile device, requesting personal data or even taking control of your wallet. Ensure that antivirus software and security updates are installed on your device, and do not open untrusted files or links.
Improper SEED Phrase Storage. The SEED phrase is the key to wallet recovery. If it is stored carelessly, such as in an unencrypted file on your computer or in the cloud, it can be stolen. It is recommended to write down the SEED phrase and store it in a secure location where it cannot be accessed by unauthorized individuals.
Hacker Attacks. Crypto exchanges and wallets can become targets for hackers. If the service has security vulnerabilities, fraudsters can steal your funds. Use platforms with two-factor authentication and always verify their security.
Pump-and-Dump Schemes and Scam Platforms. Fraudsters can create fake cryptocurrency projects with promises of high returns to deceive users. Always conduct thorough due diligence before investing in any platform.
Fake Mobile Wallet Apps. Mobile wallets are also vulnerable to attacks. Fraudsters may create a fake mobile app that looks like a popular cryptocurrency wallet but is actually a tool for stealing your funds.
The number of threats is large, but most of them can be avoided by improving your awareness of blockchain technologies and cryptocurrencies. Gain basic knowledge and continuously update it with the latest news from the crypto world. This way, you will protect your crypto funds as well as your peace of mind and time.
Choosing a Reliable Crypto Wallet
When it comes to selecting a crypto wallet, it is essential to understand that there are several types of wallets, each suited for different purposes and levels of security.
Custodial Wallets. These are wallets where a third party, such as a cryptocurrency exchange or platform, manages your private keys.
This is convenient as you don’t have to worry about key storage, but the risk lies in the fact that if the service is compromised, your funds may be stolen. Therefore, when choosing a custodial wallet, always check the platform’s reputation and its security system. Pay attention to the option for data recovery in case of data loss and ensure that two-factor authentication (2FA) is available.
Non-Custodial Wallets. Here, you alone have full control over your private keys.
This is a more secure option since no third party can access your funds. There are two types of non-custodial wallets:
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Hot Wallets. These wallets are connected to the internet, making them convenient for daily transactions. However, because they are constantly online, they are more vulnerable to hackers and viruses. Hot wallets are recommended for small amounts or for day-to-day transactions.
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Cold or Hardware Wallets. These devices are not connected to the internet (e.g., USB devices). They provide a high level of security since your keys cannot be stolen remotely. Cold wallets are ideal for long-term storage of large amounts. However, they need to be stored in a safe location to avoid losing access.
When choosing a non-custodial wallet, always consider the following factors:
1
Availability of multiple recovery options (e.g., through the SEED phrase).
2
Support for various cryptocurrencies and blockchains if you plan to work with multiple tokens.
3
Security — data encryption, two-factor authentication, open-source software (for security review).
4
Reliability and reputation of the service provider.
The choice between these wallet types depends on your goals, but in any case, always remember the importance of proper private key storage and additional protection through modern security measures.
Secure Storage of Private Keys and SEED Phrases
Private keys and SEED phrases are the foundation of your crypto wallet's security. If someone gains access to this data, they can fully control your funds. Therefore, it is essential to follow a few key recommendations for storing them:
Do not store private keys in plain sight. Write them down on paper and store them in a secure location.
Never share your keys with untrusted parties. If a fraudster learns your SEED phrase, they will gain full access to your wallet and its funds.
Use multi-factor authentication for accessing wallets and services.
Encrypt your data on devices used for key storage.
Create backup copies of your SEED phrases, storing them in different locations to ensure wallet access in case of device loss or damage.
Wallet security is impossible without proper storage of these critical pieces of data.
Two-Factor Authentication and Hardware Wallets
Two-factor authentication (2FA) is an important part of securing crypto wallets. It adds an additional layer of security, requiring the user to provide not only a password but also an additional code, usually sent to a mobile device.
Another effective protection method is the use of hardware wallets. These devices store private keys in an isolated environment and are not connected to the internet, making them resistant to hacks and viruses. With hardware wallets, even if your device or browser is compromised, your funds remain secure.
Another effective protection method is the use of hardware wallets. These devices store private keys in an isolated environment and are not connected to the internet, making them resistant to hacks and viruses. With hardware wallets, even if your device or browser is compromised, your funds remain secure.
How to Protect Yourself from Phishing and Fraud
Phishing and fraud are the most common methods used by criminals to access crypto assets. To protect your crypto wallet, it is important to follow a few simple but effective rules:
Do not click on links from suspicious sources. Always use official websites and verified apps.
Verify email addresses and domain names. Fraudsters often create fake addresses that look similar to the original ones.
Be cautious with requests for personal information. No one, including your cryptocurrency platform, will ask for your private keys or SEED phrases.
Regularly update your device and wallet software to protect against new threats.
Security with DeFi and Web3 Applications
Decentralized Finance (DeFi) and Web3 applications offer new opportunities but also carry specific risks. The application of KYT (Know Your Transaction) helps track suspicious activities within these systems, minimizing the chance of falling into fraudulent schemes. Using smart contracts and participating in decentralized applications requires extra caution.
Check the reputation of platforms and projects before investing funds.
Avoid using platforms with low-security standards. Read reviews carefully, check company contacts and documentation, and analyze the risks.
Check the reputation of platforms and projects before investing funds.
Avoid using platforms with low-security standards. Read reviews carefully, check company contacts and documentation, and analyze the risks.
What to Do if Your Wallet is Compromised
If your crypto wallet has been compromised, the first step is to immediately block access to the wallet and transfer funds to a new address. It is also important to notify your platform and contact law enforcement for an investigation.
In case of compromised transactions, you can contact AML Crypto specialists for an investigation and tracing of the funds. We perform detailed blockchain transaction analysis and can assist in identifying fraudsters and recovering funds.
Contact us via Telegram or email us at info@amlcrypto.io.
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