Store your cryptocurrency safely to avoid headaches down the line

As cryptocurrencies become more popular by the day, the risk of losing the password for your wallet can sink long-term investments overnight. By 2021, it was estimated that about a quarter of bitcoin in circulation were lost and therefore unusable.

Can you recover cryptocurrency wallets when you’ve lost your password or so-called private key? The answer, in 99% of cases, is no. There are countless stories of people losing their cryptocurrency wallet passwords.

Perhaps the best-known and most extraordinary story dates back to 2009. At the time, a computer engineer called James Howells had 7,500 bitcoin in his crypto wallet – about US$292mil (RM1.22bil) at today’s price – but the value of his assets at the time did not lead him to worry too much about securing his investment.

In 2013, he mistakenly threw his external hard drive, on which his entire stake was stored, into a dumpster. The disk then ended up in a waste landfill site, and despite Howells’ requests, the city of Newport, south Wales, refused to help him recover his precious disk because the cost of the operation was too high.

A hardware wallet, the best solution

So, while password recovery solutions rarely work, how can you best protect your precious crypto assets?

The most basic solution is to write down your password on a piece of paper and to save it carefully. But other possibilities exist, notably thanks to a French startup, Ledger, which designs and markets physical hardware wallets, to which it is possible to save one or more cryptocurrency private keys. And it could be a good option to spare you from expensive headaches.

It is also possible to store your cryptocurrencies on connected solutions thanks to specialised applications like the exchange platforms Binance or Coinbase.

Finally, your computer can be used as a storage space thanks to open source desktop wallets. Be careful though, this solution is a bit more risky since if your computer gets infected by a virus, a hacker could recover your data.

Depending on the size of your wallet, various solutions are available. However, according to the majority of crypto experts, the best idea is to invest in a physical hardware wallet like the Ledger device to store your cryptocurrencies safely. – AFP Relaxnews

Author: Traciwininger

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