yBitcoin - Volume 5, Issue 1

Page 86

Five Security Habits for a More

Anyone riding the cryptocurrency wave is likely enjoying once-ina-lifetime returns. But the longterm benefits of those returns are dependent on the way you manage your crypto portfolio. Where and how are you managing it? Investing in cryptocurrencies is not as easy as buying stock in an existing brokerage account. One day this will change, but in the meantime, you have to do some extra work and guide yourself into safe, smart cryptocurrency investing. Identical crypto portfolios may not necessarily have the same current or future value when

viewed through the lens of security. Some people choose to be 100 percent responsible for their own crypto assets, while others let someone else take responsibility. Decisions about who secures your cryptocurrencies and how will ultimately dictate how valuable those assets will be. A less secure portfolio has a higher risk of loss and is, therefore, less valuable. To give you a better sense of how to protect your crypto assets and make sure that your portfolio will be as valuable as possible, here are five habits that ensure optimum cryptocurrency security.

Valuable Cryptocurrency Portfolio

1

By Kirk Phillips, CPA, CMA, CFE, CBP

ABOUT THE AUTHOR Kirk Phillips is an entrepreneur, a Certified Public Accountant (CPA) and a Certified Bitcoin Professional (CBP) obsessed with Bitcoin as a tool to disrupt existing business models and transform accounting. Author of The Ultimate Bitcoin Business Guide, an inspirational reference for entrepreneurs and small- to medium-sized businesses, he weaves risk management into business process outsourcing, crypto-business consulting and education. He can be reached at TheBitcoinCPA.com.

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UTILIZE A

KEEP A

PASSWORD MANAGER

MASTER LIST

Using a password manager like LastPass to blend ease of use and security for accessing and using cryptocurrency exchanges, online wallets and other platforms is critical. Buying cryptocurrency on an exchange and sending it to a wallet could require simultaneously using two, three or even more platforms at the same time. A password manager is the only way to do this with speed and efficiency.

Keep an inventory or a master list of all of your exchanges, wallets and coins. A simple portfolio, for instance, would be a Coinbase account with ether, bitcoin and litecoin. However, someone with 67 coins who uses 11 exchanges and 23 wallets has a more complex crypto portfolio. What happens if you back up your passphrases and always follow best practices but forget you actually own a coin or the wallet where it’s stored? This can happen faster than you think as your portfolio grows more complex. A master inventory list works as a cross-check with your portfolio apps which may not provide that level of detail.

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