Trading and investing securely for retirement is a top concern for crypto investors, especially when they hear that the digital asset ecosystem has been impacted by cybersecurity events. Investors of all levels need to know how to secure crypto in their retirement accounts. It’s important to choose a crypto platform that can keep your savings safe from hackers and thieves.
The security of a cryptocurrency account often depends on how it is stored and the amount of protection behind the chosen storage method. So, how does cryptocurrency security work?
Cryptocurrency Security
Because they are digital assets, investors can’t hold cryptocurrency in their hands as they can stock notes or precious metals—they’re not tangible. In this manner, exchanging cryptocurrencies is similar to using a banking card in which money is electronically spent. On the other hand, unlike a banking card, every bit and byte of cryptocurrency has a ledger that follows it. Spending and exchanging are recorded on the blockchain the crypto was built on, so a permanent history is attached to each asset as it moves from one user to another.
While the transactional log alone does not protect your account from hackers, it may make it more difficult for hackers to steal cryptocurrencies. After reading through stories about cryptocurrency theft, investors may learn that most thefts are inside jobs or due to serious security flaws on the account provider’s side.
How to Secure Your Cryptocurrency
Average cryptocurrency investors may opt for one of two kinds of “wallets” to store their cryptocurrency: a hot wallet or a cold wallet. A hot wallet is connected through a cloud infrastructure online and may require multiple security options through an investor’s chosen portal. A cold wallet is a hardware device that may look similar to a USB drive and stores the cryptocurrency blockchain offline.
These digital wallets are often secured by a password and sometimes two-way authentication. For example, a hot wallet could contain two keys, one private and the other public.
Investors who choose to use hot wallet storage may elect to utilize the public key to put funds into the wallet and then the private key to spend the cryptocurrency. Using an offline storage method gives investors complete control of when others access the keys. While there may not be a single, most-secure cryptocurrency, online account providers have a variety of ways to protect private keys.
To keep your wallet safe, choose an account provider that offers:
- A cold storage wallet
- Enhanced private key storage
- Two-way authentication
Some investors may decide to make a backup of a private key in case it gets lost.
How to Secure Cryptocurrency in an IRA
Investors who elect to invest in cryptocurrency in their IRA accounts may still need to select a hot or cold wallet. Unlike traditional crypto investors, retirement fund cryptocurrency investors do so through a custodian. The custodian may help you choose between hot and cold wallet options.
Other ways to keep your wallet safe include:
- Change passwords often, and use strong passwords
- Avoid phishing scams
- Double-check browser extensions
Safely Investing Retirement Funds in Crypto
Bitcoin IRA is the first and leading self-directed IRA platform that provides users with the opportunity to invest in over 60 different cryptocurrencies across all 50 states. Available via a web browser and a convenient and user-friendly mobile app, the Bitcoin IRA platform connects users with a qualified custodian, digital wallets and cryptocurrency exchanges. Offering world-class security1 with 100% offline, cold storage and multi-signature wallets, Bitcoin IRA is seen as a safe choice by over 170,000 users.
Bitcoin IRA carefully chooses cryptocurrency assets before offering them to customers and utilizes some of today’s safest wallets. Digital assets are securely stored with BitGo along with industry-leading custody protection and insurance.1
Experience the Bitcoin IRA2 difference for yourself when it comes to diversifying your retirement holdings.
1Security, storage, wallet providers, and insurance may vary based on asset chosen and custody solution available.
2 Alternative IRA Services, LLC dba Bitcoin IRA is a platform that connects consumers to qualified custodians, digital wallets and cryptocurrency exchanges. The company is not a custodian, is not a digital wallet and is not an exchange. Self-directed purchases processed through Bitcoin IRA have not been endorsed by the IRS or any government or regulatory agency. Bitcoin IRA is not an adviser. Information contained on this website is for educational purposes only. We encourage you to consult an adviser or professional to determine whether Bitcoin IRA makes sense for you. Cryptocurrencies are very speculative and involve a high degree of risk. By using the website, you understand the information being presented is provided for informational purposes only and agree to comply with our Terms of Use and Privacy Policy.
Questions on getting started with cryptocurrency investing in your Bitcoin IRA account? Our specialists are here to help! Call us at 877-936-7175 or email us today.
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