How to Protect Your Cryptocurrency Investment
The number of crypto traders in Australia and around the world is growing exponentially. According to one report, by January 2021, the number of crypto users around the world had grown to 106 million, with a 15.7% increase documented during the month of January alone. While this is exciting news for cryptocurrency brokers in Australia, it is also a timely reminder that cryptocurrency (like any valuable asset) can attract the attention of scammers. And when it comes to cryptocurrency and cybercrimes, the targets are often those who are new to crypto trading. Fortunately, there are simple steps that you can take to protect your cryptocurrency investment.
Crypto Traders in Australia Should Stay Informed
Scammers are constantly coming up with new online posts, scam trades and fake emails, but the methods they use have remained more or less unchanged since cryptocurrency started gaining popularity. This makes it easier for well-informed first-time crypto traders in Australia to identify and avoid potential scams. The three most commonly used cryptocurrency scams are:
- Fraudulent emails: Also known as phishing scams, this is when cybercriminals send legitimate-looking emails on behalf of real companies in an effort to steal information. To prevent getting caught in a phishing scam, avoid clicking on unverified links. Take time to confirm that all emails are from a verified email address (if you’re unsure, contact the Customer Support Team via the official website) and refuse to share any sensitive information (including user names and passwords) online.
- Fake trading bot schemes: This kind of scam targets investors with the promise of significant financial returns in a short space of time. Once a crypto trader has made an initial investment, they start to receive great returns. This inspires them to invest even more money and to encourage others to sign up. What they don’t realise is that their “returns” are actually just the funds that new investors are contributing and that once the scammer has made enough money, they’ll disappear into cyberspace (along with all of your investment). Be wary of any investment opportunity that offers high returns with minimal supporting information or insufficient details about who is running the operation.
- Elaborate crypto giveaways: Crypto giveaways ask people to deposit cryptocurrency with the promise they’ll get back more than what they put in (often double). This kind of scam will usually involve a well-known celebrity endorsement via social media, making it seem more legitimate. To avoid getting caught, never deposit cryptocurrency into unverified platforms and be cautious of social media endorsements (which can be easily hacked or faked).
Best Practice Tips for Crypto Traders in Australia
In addition to staying informed about the various scams circulating online, there are some basic things you can do which will serve to protect your cryptocurrency investment. These include:
- No digital copies: Don’t make any digital copies of your crypto trading details. It’s almost second nature to take a screenshot or make a digital note of important details that we need to remember. But digital records are susceptible to hackers, so if you need to write something down, do it the old-fashioned way (with a pen and paper) and then store it somewhere secure.
- Use two-factor authentication: Cryptocurrency brokers in Australia will often encourage users to enable two-factor authentication when they’re logging in to the platform. While this may seem like just another annoying detail (particularly if you’re in a hurry), two-factor authentication is designed to protect your investment, so it’s well worth the extra effort.
- Vary your login details: Make sure you use different passwords for your various online accounts. It’s very tempting to re-use the same login name and password, but this will leave you vulnerable in case of a privacy breach.
Use Trusted Cryptocurrency Brokers in Australia
Another way to protect your cryptocurrency investment is by only using reliable cryptocurrency brokers in Australia. Coinstash is a registered digital currency exchange based in Australia, with secure SSO encryption and no hidden fees.