Is cryptocurrency safe?

In this article, we share 3 tips from Binance Australia’s risk officer to keep your cryptocurrency safe.

There are many articles on this wide web explaining the basics of blockchain and cryptocurrencies; this article is not one of those. Whilst it is crucial to know the foundations, learning how to keep your cryptocurrencies and account safe is equally important.

Is it safe to invest in crypto?

A little under a year ago, I worked for a leading financial institution trying to crack a Financial Crime Syndicate. Think Ozarks or Breaking Bad, but much, much bigger. The “bad guys” found a way to bypass different banks’ security identification requirements. They then used this hack to move large sums of money across banks, secure six-figure loans, and at one point even treated themselves to Lamborghini. A little money laundering and fraud, all before lunch. Whilst my job sounded like a plot to a Hollywood blockbuster (and let’s face it, it is – contact me any time, Paramount), I have now gathered over 10 years of experience investigating how people’s financial assets can be vulnerable to these “bad guys” or in crypto terms – bad actors. Now, it’s my job to teach you everything I have learned. I have broken it down into three key areas which have been borrowed a little from the Ancient Greek aphorism; Know Thyself, Know Thy-digital asset platform and Know My rules.

Can you lose money in cryptocurrency?

1. Know Thyself

Understanding your limits is essential when it comes to any financial investments. How much are you willing to invest? When is it the right time to cash out? What is your investment time horizon? All these questions can only be answered by yourself. Understanding your risk tolerance is essential because, after all, cryptocurrencies are high-risk assets.

What are the risks of cryptocurrency?

2. Know Thy-Digital Asset Platform

When you sign up for a Binance Australia account, the first thing we want to do is make sure you are who you say you are. We will usually ask for proof of this through forms of different identifications, such as your driver’s licence. We are required to do this through laws in Australia, and my team makes sure we meet those requirements. Just as we do due diligence on you, you should do due diligence on us. Before signing up to any platform, please check the licence conditions, Terms and Conditions and Privacy Policy. You can also check things like traffic, liquidity and trading volumes levels here for different platforms – after all, you don’t want to be stuck trying to sell an asset with no buyers. The smaller the platform, the likely the higher risk you will be taking.

3. Know My Rules

Once you understand your own risk tolerances and have picked the suitable digital asset exchanges (hopefully one with a black and gold logo), it’s time to start securing your account and implementing best-practice going forward. Here are my top tips to keep your assets safe.

• Ensure you have enabled multi-factor authentication. We will ask for your email and mobile number and recommend you download and sync the Google Auth app. This way, we can identify your trades and withdrawals through different devices. Confused? There is a guide here.
• We love our Binancians, but we will never text you a link to click on. Please never click on the link sent via a text message from anyone.
• Sorry, we aren’t going to call you either. If you receive a call from anyone from any platform out of the blue, hang up and report it straight to the chat desk.
• This one seems simple, but if you use the website to trade, always type in the full address (or bookmark). There are many dodgy websites out there trying to be us. What’s the saying about flattery again?
• Follow your gut. It doesn’t feel right? Most likely, it isn’t right. Contact the exchange or provider directly.
• Feeling exceptionally experienced and wanting to transfer your assets away from us? Then you will need to know the difference between custodial vs. non-custodial wallets – choose wisely.
• Finally, you are ultimately responsible for your financial security, so please take it seriously. If you believe you have fallen victim to a scam and/or criminal activity, be sure to report it to Law Enforcement in the first instance. You can report the incident to Scamwatch Australia.

Stay Safe Folks

Whether you are a crypto beginner or a certified degen, you should continue to expand your knowledge of this crypto world. Understand your time horizon, risk tolerance, and do your due diligence before investing in cryptocurrency.

Cover image source: Hantiuke/Shutterstock.com