Crypto Expert (Beginner to Pro) #3 - Safety in the Crypto Ecosystem

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Introduction

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Learning about cryptocurrency, its technology and others is not enough if the technical knowledge of how to stay safe is not well understood. People have had their entire life savings drained right in front of them while they remained powerless.

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Practising safety precautions in the crypto ecosystem will enable you to enjoy what you have laboured for. In our context today, we will take a look at how to stay safe in your journey and interactions across wallets, dApps and other protocols.

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Why safety is Important?

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The crypto ecosystem is designed to be decentralized as much as possible such that you are in total control of your assets and can determine what to do with them and where to use them at any point in time, without waiting for any approval from an outsider.

Your wallets unlike the conventional bank accounts may not require the interference of an intermediary that estimates your transaction and gives approval to pass them on or reject them, except in centralized exchanges (with a central body). It is important to know that if your entire wallet security lies in your hand and an attacker has access to it, that may be the end.

In essence, you are the sole owner and protector of your crypto assets and it is required to do the job to your very best. Beginners guide here on Steemit must have guided you on security on STEEM which walks you through numerous ways to practice safety throughout your interaction with the Steem ecosystem.

Steemit is a decentralized ecosystem and the creation of your wallet comes with the generation of private keys that are the main locks to your account and wallet. These keys are meant to be kept safe to yourself and not shared with anyone. Has your recruiter after your account creation ever asked you to share your keys with him/her before? If yes, it is worth reporting such acts. On your end, never ask your friends or recruits to share their keys with you.

_{Scammers are watching | Pixabay}

Private keys to wallets in the crypto ecosystem are meant to be known by a person, the owner except in a few situations where an organization or group of friends are managing a multi-sig wallet for adequate consensus of what transaction originates from a wallet. This type, multi-sig can be operated by more than a person, 2 or 3 or even more cosigners. You can read this article for a practical example of how multi-sig works - Account Abstraction in Blockchain.

We have talked about a certain category of wallets in the crypto ecosystem to be centralized and decentralized wallets, each with a unique method of operation and security. We will look into this in the next section.

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Central Bodies and Decentralized ownership in Cryptocurrency

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In the crypto ecosystem, there is an existence of central bodies to manage transactions on some protocols, even though cryptocurrency is built on a distributed ledger technology to keep users in control and ensure transparency across chains.

The most common central bodies in cryptocurrency are the crypto exchanges. These bodies manage your accounts with them and when you initiate a transaction, they decide on what permission to give at any point in time. Some of the popular ones are Binance, CoinBase, KuCoin, ByBit, Mexc, Roqqu, Bitmart, Bittrex, HTX and so on, depending on your region.

Some of the things to know about these central bodies are:

• They have total control over your account and wallet.


• You are only permitted to use passwords to access your wallets and other security methods to enhance access.


• They hold the private keys to your wallet.


• They have customer service and may help out when there is an issue or mistake.


• They provide continuous guidance to dos and don'ts.

Decentralized ownerships are the privileges you enjoy when you own decentralized wallets and store your assets in them. We have highlighted certain decentralized wallets before, like Steemit Wallet, Metamask, Trust Wallet, TronLink, Near Wallet, Avocado Wallet, Phantom, Soflare and so on, each on its distinctive chain compatibility and some, exhibits cross-chain.

_{Representation of Bitcoin as a Decentralized asset | Pixabay}

The creation of these wallets hands over the ownership to you at the point of account creation and you remain the sole ruler over it henceforth. There are a few things to know about these types of wallets and some are:

• You are in total control of your assets.


• You own the private keys to your wallets.


• You must add personal security measures in addition to the cryptographic security attached.


• There may not be a support team to help you out when you encounter issues.


• No waiting time for permission from any central body.

The two groups discussed above have their distinctive good and bad sides, it's the duty of a user to choose ohat suits him/her the most.

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How to Stay Safe?

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It is important to know some of the ways to enhance the security of one's wallet, especially the latter wallet type discussed in the last section. Regardless of what category of wallet, these are some of the ways to protect your wallet:

• Don't share your private keys with anyone (not your keys, not your money).


• Have your keys saved in a safe place, preferably written down offline.


• Only connect your decentralized wallets to trusted dApps or protocols.


• Use two-factor authentication (2FA) keys for your exchange wallets.


• Don't store your life savings on exchange wallets, save them in a decentralized wallet (if possible, don't connect this wallet to any website, only utilize it for sending and receiving crypto).


• Don't click random links, especially those that require authorization to your wallets.


• Scan and revoke some authorizations on your wallets from time to time.


• Don't interact with strange assets that appear in your wallet. Verify the source properly.


• Consider a cold wallet if you can afford it.

The list on how to stay safe remains endless and we can go on and on. In the subsequent series, we will be looking at some of the ways scammers utilize to lure asset owners.

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Conclusion

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In conclusion, the crypto ecosystem has become one of the most targeted industries for scammers as such you should be equipped with ways to stay safe. For emphasis, you may experience a total loss ofassetst if you lose your keys to an outsider. Guard your keys and utilize some of the tips shared in this piece to safeguard your centralized and decentralized wallets. We will see in the next article. Cheers!