Bitcoin prices continue to fluctuate, with the value of the cryptocurrency tumbling since hitting a record high of over £14,000 last December.
And as people continue to flock to invest in Bitcoin, it becomes vitally important to make sure your money is safe and secure.
Cryptocurrency exchanges in the past have been hacked, with thousands of Bitcoin stolen – which would amount to millions of pounds today.
In December 2017 South Korean cryptocurrency exchange Youbit filed for bankruptcy after a cyber attack saw 17 per cent of its assets stolen.
And since Bitcoin transactions are irreversible, if your wallet gets emptied you won’t simply be able to get a refund.
But there is a way for Bitcoin investors to protect against this.
Security experts are recommending Bitcoin fans store their coins in an offline ‘cold’ wallet, The Independent reported.
Bitcoin investors who purchase the cryptocurrency through an online exchange and store it there leave the security of their investment in that site’s hands.
If the cryptocurrency exchange gets hacked, which there has been a number of high-profile instances of, then your Bitcoin could be stolen.
The exchange holds investors’ private keys, and if a hacker got their hands on it then they could gain access to victims’ cryptocurrency holdings.
Last December 4,700 Bitcoin was stolen from digital currency marketplace NiceHash.
Using the current value of Bitcoin, the amount of cryptocurrency stolen amounts to over £46.2million.
To keep an investment safe and secure, Bitcoin investors are being advised by security experts to store their money offline in a ‘cold’ wallet.
This could be a USB, an external hard drive or even on a piece of paper stored in a secure location.
Speaking to The Independent, Kaspersky Lab’s Alexey Malanov said: “The ever increasing value of cryptocurrencies, especially bitcoin, makes them a very attractive target to cybercriminals, who use various methods to get their hands on them.
“There have been several huge hacks of cryptocurrency exchanges in the past and the trend will only continue.”
