Secure your cryptocurrency with key cybersecurity strategies. Safeguard your digital assets from hacks, scams, and vulnerabilities using hardware wallets, MFA, and smart contract precautions.

Cryptocurrency and the blockchain community continue to expand, and 2025 will be no exception. With advancements in blockchain technology, thriving decentralized finance (DeFi) platforms, and the increased popularity of niche virtual assets, securing your digital investments is more critical than ever. 

Last week’s report from leading blockchain security platform Immunefi also highlights the risks faced by crypto users, revealing that hackers drained $1.48 billion from crypto projects in 2024, with DeFi being the primary target.

It’s estimated that there are now more than 560 million crypto holders worldwide. With so many individuals owning crypto globally, these assets must be kept safe and protected. While Bitcoin is still the most popular crypto, many other assets have quickly gained popularity among new and seasoned investors alike.

For example, it’s estimated that more than 100 million people own Ethereum alone. Similarly, meme coins are becoming extremely popular as they offer investors the chance to buy in at a low cost and see large gains if the project does well.

According to Eliman Dambell, Ethereum meme coins offer investors a unique opportunity to buy into a project that combines the light-hearted aspect of meme coins with solid utility. 

As these coins and other crypto assets gain traction, so do the threats and risks targeting crypto holders. Let’s explore the comprehensive strategies you can use to protect your digital wealth in an era of increasingly sophisticated cybersecurity threats. 

Why Is Crypto Safety Important? 

Crypto safety is crucial because cryptocurrencies operate in a decentralized system where users are solely responsible for securing their assets. Without proper safeguards, funds can be lost through theft, scams, or hacks, with no way to recover them due to the irreversible nature of blockchain transactions. By ensuring this safety, you protect your digital investments, preserve privacy, and maintain trust in the blockchain ecosystem. 

However, as technology advances, it’s becoming increasingly more challenging to keep your cryptocurrency safe. As we move into 2025, you need to understand the strategies to effectively secure your digital assets. 

Step #1: Consider Investing in Hardware Wallets

Hardware wallets remain the safest option for long-term storage of cryptocurrencies. These hardware wallets allow users to keep their private keys offline, away from online hackers. Even if your computer or phone is compromised, using a hardware wallet ensures that your funds can’t be accessed without physically interacting with the device. 

Before you purchase a hardware wallet, you want to make sure you only buy this device directly from the manufacturer or an authorized reseller. Avoid purchasing hardware wallets from unverified sources or secondhand marketplaces. That’s because these wallets could have been tampered with to include malicious software. Additionally, you want to regularly check for firmware updates from the wallet provider to guarantee your device remains secure. 

Step #2: Always Use Multi-Factor Authentication  

Multi-factor authentication (MFA) adds a barrier between your assets and potential attackers. Most cryptocurrency exchanges, wallet apps, and blockchain services support MFA, allowing users to pair their accounts with an authenticator app or SMS-based verification.

While MFA is a strong security feature against unauthorized access, be mindful of the method you choose. Authenticator apps like Google Authenticator or Authy are generally more secure than SMS-based codes, which can be intercepted through SIM-swapping attacks.

Step #3: Do Thorough Research Before Engaging with Smart Contracts 

The rise of DeFi protocols and blockchain-based applications has brought unparalleled financial opportunities – but also unique risks. Smart contracts, which automate transactions and agreements, are susceptible to bugs or exploitation if poorly coded.

Before interacting with any smart contract, you want to conduct thorough research. Look for audits from reputable firms such as CertiK, OpenZeppelin, or Trail of Bits. These audits evaluate the security of the smart contract and help identify potential vulnerabilities. However, you also want to remember that audits do not guarantee safety. That’s why you should always proceed cautiously, especially with newer projects.

Step #4: Pay Attention to Social Engineering Scams

To trick people into giving up their crypto, scammers often use social engineering. This might involve these hackers sending fake emails, posing as customer support, or setting up websites that mimic trusted platforms to steal recovery phrases or private keys. 

Here’s how you can remain safe from social engineering scams: 

• Stick to official apps instead of using web browsers for wallets. 
• Always double-check URLs before entering any sensitive information. 
• Take note that no legitimate company will ever ask its customers for their recovery phrases or private keys. 

Remember to stay alert and educate yourself and others about these social engineering scams to help reduce the risk of being targeted by one of these scammers. 

Step #5: Always Keep Your Wallets and Software Updated 

Keeping your wallets and software up-to-date is crucial because hackers often exploit outdated software. Because blockchain platforms, wallet providers, and exchanges regularly release updates to improve security features or fix vulnerabilities, you want to keep your software and e-wallets as safe as possible by always updating them. To do this, you can: 

• Enable automatic updates on your apps and devices. 
• Regularly check for firmware updates on your hardware. 
• Stay informed about announcements or updates from your exchange or wallet provider. 

By skipping these updates, you could leave yourself exposed to preventable attacks. 

Step #6: Look into Diversifying Your Crypto Storage

You want to avoid putting all your eggs in one basket. In the context of securing your cryptocurrencies, storing all your digital assets in one account or wallet increases the risk of losing everything if that wallet gets compromised or hacked. Instead, you want to use a combination of storage methods, which could include: 

• Hardware wallets for long-term storage. 
• Software wallets for day-to-day transactions. 
• Custodial wallets on trusted exchanges for convenience when trading. 

When you spread your holdings across different wallets, you reduce the potential losses from a single breach. 

Step #7: Secure and Protect Your Recovery Phrases 

Also known as your seed phrase, your recovery phrase is the master key to your wallet. If you lose this recovery phrase, you lose access to your funds. And, if someone else steals this seed phrase, it means they can steal everything in your wallet. However, you can keep your recovery phrase safe by: 

• Use waterproof and fireproof metal backups for extra protection. 
• Writing it down on paper and securely storing it – like in a deposit box or safe. 
• Avoiding digital storage – don’t save it on your phone, computer, or cloud services. 

Remember to never share your recovery phrase with anyone, no matter how convincing they might seem. 

Step #8: Only Use Reputable Services and Exchanges 

Not all platforms and exchanges are created equal. Even though decentralized platforms are gaining traction, centralized exchanges remain crucial for trading and liquidity. That’s why you should consider only using well-established exchanges with strong security measures. When you do this, you gain:

• Insurance against hacks. 
• Storage of funds offline in cold wallets. 
• Features like transaction limits and withdrawal whitelists. 

For added security, you want to transfer your funds to a private wallet after trading, as opposed to keeping them on the exchange. 

Step #9: Be Careful with High-Risk Investments 

The rise of niche assets like NFTs and meme coins has captured the attention of many investors. While some may deliver impressive returns, others can be scams, such as pump-and-dump schemes or rug pulls. To avoid falling victim:

• Only invest what you can afford to lose.
• Research the project, its team, and its tokenomics thoroughly.
• Use on-chain analytics tools to detect suspicious activity or patterns.

Approach high-risk investments cautiously, and don’t let the fear of missing out cloud your judgment.

Step #10: Start Preparing for Quantum Computing Threats

As quantum computing advances, the cryptographic algorithms protecting blockchains could become vulnerable. While practical quantum attacks are still years away, the crypto community is already exploring quantum-resistant solutions.

Keep an eye on developments in this area and stay informed about projects implementing quantum-proof measures. Proactively adapting to this future threat can help secure your investments in the long term.

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November saw a surge in cryptocurrency exchange volumes, hitting a three-year-high, driven by several factors. New Hedge said spot crypto exchange volumes reached $2.9 trillion, the highest since May 2021. Industry leaders attribute this spike to Donald Trump’s election win, alongside growing hopes for a more favourable regulatory environment in the US and abroad.

The strong performance came as investors responded to Trump’s victory and the prospect of a more crypto-friendly US government. With increased interest in cryptocurrency, many exchanges recorded record-high monthly trading volumes. A spokesperson from Crypto.com confirmed that November was the platform’s “strongest month in the last year,” with heightened trading activity across markets.

US Election Sparks Surge in Cryptocurrency Trading Activity

The US election results have been a major factor in the recent uptick in crypto trading activity. Pro-crypto candidates gained significant ground in Congress, suggesting a more favourable regulatory environment for the industry. These political developments have generated positive market sentiment, particularly regarding cryptocurrency regulations.

Several industry leaders, including Crypto.com, have pointed out that the US government will likely adopt more supportive digital asset policies. This shift is expected to provide greater regulatory clarity, further encouraging investments in the cryptocurrency space. With a pro-crypto government, the industry anticipates a more stable and predictable environment moving forward.

Beyond the US, countries worldwide are taking steps to introduce regulatory frameworks for digital assets. These frameworks are seen as crucial for fostering adoption and ensuring the long-term viability of cryptocurrency markets. As a result, global trading volumes have also significantly boosted, reflecting growing confidence in the sector.

Perpetual Contracts Fuel Crypto Exchange Volume Growth

Cryptocurrency Exchanges like Kraken and Binance also reported strong trading volumes in November, particularly in perpetual contracts. Kraken’s Jonathon Miller stated that Bitcoin perpetual contracts saw a substantial increase in trading activity. Solana (SOL) and Dogecoin (DOGE) also set new monthly all-time highs, contributing to a broader market rally.

Miller explained that this surge was fueled by traders seeking leveraged exposure or looking to hedge their positions. With increased volatility in major cryptocurrencies like Bitcoin and Dogecoin, traders found new profit opportunities. The success of these assets, especially Dogecoin, has been driven by an ongoing market interest in memecoins.

Binance, on the other hand, observed an influx of new participants in the crypto market. The platform attributed this growth to various factors, including approving Bitcoin exchange-traded funds (ETFs) in significant markets. These developments will likely shape trading behaviours and boost overall market volumes.

Crypto ETFs Surge as Bitcoin Interest Grows

Bitcoin ETFs also significantly contributed to driving up exchange volumes in November. These ETFs saw inflows of $6.87 billion during the month, alongside $411 million in outflows. This surge in interest highlights the growing mainstream acceptance of cryptocurrency investments through traditional financial channels.

The approval of Bitcoin ETFs in significant markets has made it easier for investors to gain exposure to digital assets. This is a key factor behind the increased participation in the crypto space. As more investors enter the market, the demand for cryptocurrency-related products like ETFs will remain strong.