The Noble Institution offers our members the opportunity to trade in cryptocurrency, the exciting but volatile new type of currency based on blockchain technology. Considering how new this type of currency is, you might be wondering whether you can trade in it safely. This blog will seek to address that question.
What Is Cryptocurrency?
So, what is cryptocurrency? It’s a type of currency that isn’t issued by a government. It can be used to make purchases just like any other type of currency, but it isn’t printed like paper money. Instead, this new type of currency exists in the form of a distributed ledger called the blockchain. Whenever cryptocurrency is bought or sold, the transaction is recorded in this distributed ledger. Because the distributed ledger is essentially anonymous, you can buy and sell with a degree of privacy you wouldn’t expect in regular currency trading. However, this extra privacy carries some risk with it.
If the cryptocurrency you own is stored online, then it can potentially be vulnerable to theft by hackers, who are unlikely to be caught due to the anonymous nature of distributed ledger transactions. After all, your ownership of a Bitcoin is controlled by a password, and passwords can obviously be stolen. Most people keep their cryptocurrency in a “hot wallet,” meaning a digital wallet connected to the internet. Keeping your password in a “cold wallet” is a lot safer, although not entirely without risk.
A cold wallet can be anything from a USB device to a scrap of paper with your password on it. Either way, it’s “cold” as long as it’s not connected to the internet and therefore cannot be hacked. Of course, there is always the risk that it could be lost or stolen, in which case you would permanently lose access to your cryptocurrency.
How to Trade Cryptocurrency Safely
So, what’s the solution? How can you trade cryptocurrency safely despite the threat of hackers –and the risk of forgetting your all-important password? For many people, the solution is to do business with trading companies that follow robust security procedures. Research a company before you trade with it. If the company has a good reputation for online security, then you have minimized the risks as much as you can.
Contact The Noble Institution at 1-833-645-1535 to get started trading cryptocurrency safely today!