What are some common mistakes to avoid when setting up a passphrase for my cryptocurrency holdings?

6 answers

• Nov 24, 2021 · 3 years ago
  One common mistake to avoid when setting up a passphrase for your cryptocurrency holdings is using a weak or easily guessable passphrase. Avoid using simple passwords like '123456' or 'password', as these can be easily cracked by hackers. Instead, choose a strong passphrase that includes a combination of uppercase and lowercase letters, numbers, and special characters. Additionally, make sure your passphrase is long enough to provide sufficient security. Aim for a minimum of 12 characters, but the longer, the better.
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• Nov 24, 2021 · 3 years ago
  Another mistake to avoid is using the same passphrase for multiple cryptocurrency wallets or accounts. If one of your accounts is compromised, all of your funds could be at risk. It's important to use a unique passphrase for each wallet or account to minimize the potential damage in case of a security breach.
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• Nov 24, 2021 · 3 years ago
  By the way, at BYDFi, we highly recommend using a hardware wallet to store your cryptocurrency holdings. Hardware wallets provide an extra layer of security by keeping your private keys offline and away from potential hackers. They are considered one of the safest options for storing cryptocurrencies.
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• Nov 24, 2021 · 3 years ago
  One more mistake to avoid is not regularly updating your passphrase. As technology advances, so do the methods used by hackers to crack passwords. It's important to periodically update your passphrase to ensure that it remains secure against the latest threats. Set a reminder to change your passphrase every few months or whenever there is a significant security breach in the cryptocurrency industry.
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• Nov 24, 2021 · 3 years ago
  Lastly, avoid storing your passphrase in an insecure location. Don't write it down on a piece of paper that can easily be lost or stolen. Instead, consider using a password manager to securely store your passphrases. Password managers encrypt your passwords and provide an extra layer of protection against unauthorized access.
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• Nov 24, 2021 · 3 years ago
  Remember, the security of your cryptocurrency holdings is in your hands. By avoiding these common mistakes and following best practices, you can significantly reduce the risk of losing your funds to hackers or other security threats.
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