Cryptocurrencies have come a long way since the heady days of 2009 when Bitcoin first appeared on the scene. Nowadays, what was once designed to be a type of inflation-proof currency has since become one of the most sought-after investments in the world.
Nowadays, cryptocurrencies are widely accepted worldwide and have even been adopted as legal tender in countries like El Salvador.
While all of this is extremely exciting, there’s no hiding that cryptocurrencies do not have their fair share of problems.
As cryptocurrencies are totally unregulated, they are often a favorite target of cybercriminals and hackers alike. There have been numerous incidents where crypto wallets have been hacked and emptied out.
And as these assets are decentralized, it is nearly impossible to track and recover funds that have been stolen.
Due to this, the safety of crypto wallet apps is often brought into question, with users worrying that they could potentially lose everything. Nonetheless, companies put lots of emphasis in the security of these apps, as you can witness by Tezrolist: blog.tezro.com/best-crypto-wallet-apps/
While technological advancements have come a long way, many users still worry whether crypto wallet apps are still safe to use in 2022. This is why we’re taking a look at two reasons why you should use crypto wallet apps and one reason why you may want to reconsider.
So, are crypto wallet apps safe to use or not? Take a look at what to have in mind.
1. Security measures and government oversight
Just as the crypto market has evolved over time, so have technological advancements and security measures intended to keep your assets safe. The latest crypto wallet apps are specially designed to keep hackers from accessing your precious crypto, from two-factor authentication to customizable PINS.
Additionally, with increased government oversight, there is immense pressure on service providers to keep assets safe. Also, there are wallet apps such as Gemini that even insure crypto assets that boost consumer confidence.
As cryptocurrencies assimilate into everyday life, hot wallet service providers will also be forced to act more professionally. And in turn, this will translate into better management practices and less cybercrime.
2. The market for wallet apps is exceptionally competitive
Besides government oversight, the fact that the crypto market is highly competitive is another reason why hot wallets are safer.
News of any untoward incidents will quickly spread, and this, in turn, will cause mass withdrawals which can bring down any service overnight.
With thousands of service providers available, wallet apps have an incentive to keep their customers’ assets safe, no matter the cost. This includes investing in military-grade data encryption and other stringent security measures.
Why crypto wallets are still not safe
Crypto is a high-value investment
As we’ve seen in recent years, cryptocurrency valuations have shot through the roof, with assets like Bitcoin, Ethereum, and Dogecoin going on a wild ride. While this has done wonders for the crypto community, it has also turned cryptocurrencies into one of the most sought-after assets.
And as cryptos can be transferred anonymously, tracking down missing cryptos is next to impossible.
As a result, hackers and cybercriminals are more determined than ever to break into online exchanges and wallets. Even with increased government oversight and the billions invested in cybersecurity, cryptocurrencies are still too enticing a target.
But this doesn’t mean that you shouldn’t make use of hot wallets – far from it, in fact. Hot wallets are incredibly convenient and allow you to perform transactions with ease.
Instead of storing the bulk of your assets in your hot wallet, invest in a cold wallet and keep your assets offline. Cold wallets cannot be hacked into and hidden for even better security. This also benefits minimizing your risk exposure and making you less of a target.
Remember: cryptocurrencies are an extremely volatile investment, and you should only invest what you’re prepared to lose.