Earning interest using a crypto savings account has become quick and easy with so many quality exchange platforms consumers can choose from. While the process is efficient and profitable in many ways, the real question is: Is it safe?
In this article, we’ll discuss how to safely earn interest using a crypto savings account so you can build wealth confidently.
What Makes A Crypto Savings Account Safe?
Ensuring the security of your crypto savings account depends on a variety of factors, but the ultimate key to keeping your assets safe relies on which crypto exchange platform that you partner with.
Consumer options for exchange platforms have grown significantly in recent years, but this does not mean that all crypto banks have followed the same trend.
Quality platforms will offer exceptional security to protect their customers. Some platforms, however, choose higher profits over strengthened security. To safely earn with a crypto savings account, it is important to identify what makes a platform’s security ideal.
To protect users from potential hackers and external threats, reliable platforms utilize multi-factor authentication (MFA) to create a dynamic password.
The multiple steps of this password make it so you can quickly access your account while deterring hackers. Aside from a typical type-based authentication, an MFA also requires users to answer a phone call or text with a specified pin.
Vauld is always cautious of hackers’ growing interest in crypto accounts, and an MFA is just one of the many ways we aim to protect users. The extra hardware-based verification system gives you more control over your assets while diminishing the risk of hacks.
An account that requires your fingerprint or an eye scan is another efficient way to allow easy access while greatly limiting threats. Since many of us use our phones for transactions rather than a computer, this adds another layer of security.
In the case that multiple users are trying to access the same account, this should immediately set off a red flag with any crypto exchange platform that cares about their customers’ security. That’s why, at Vauld, we have implemented video verification.
If an instance like the one mentioned above occurs, then we will temporarily disable the account in question and arrange for a video call between a Vauld team member and the account holder to identify the true owner.
Once the user has confirmed details provided by the true account holder upon setting up their account, the account is then released back to them. This process is also a useful and safe way for users to regain access should they forget their login information.
The option to safelist lets your account know which transactions are authentic and which are performed by potential hackers. When your device is safelisted, any activity occurring from an unknown device will automatically limit withdrawals.
With the safelisting feature enabled, hackers and bad actors are unable to access the assets in an account, even if it is compromised. Meanwhile, we identify the threat and inform you of the situation.
The easiest way a platform can help you keep your assets safe in the event of a potential threat is by informing you immediately. While the platform enlists its safeguarding features, you can take further precautions if you believe a threat has been detected.
Preventing And Handling Crypto Savings Account Breaches
An encounter with any type of online threat is frightening. Before your account gets hacked — or in the event that it does — follow the steps below to further protect against malicious groups and individuals.
Check The Platform’s Security
Ideally, this step should come before any suspicious activity ever occurs. Check to be sure the company is properly insured before earning interest using crypto so that you know you’re covered in the event of a system-wide hack.
It gets trickier for the hacking of individual accounts, especially since crypto is not FDIC-insured. Still, there are ways to keep your account secure and potentially get back any crypto that was taken.
Lock Your Account
The ability to lock your account can make all the difference should a hack occur. Once the account holder is notified, the next immediate step is to lock not only the account with crypto but also any fiat bank account or similar platform as well.
Depending on how the hacker gained access to the account, there’s always the possibility that they are trying to take more than cryptocurrency. We recommend locking all other accounts that you can to prevent further issues.
If the threatened account cannot be locked, then be sure to change your login information immediately.
Notify Your Exchange Platform
Although the platform will likely be identifying and resolving the threat at this point, it’s still important to notify the company in case certain activities have gone undetected.
Not only will this establish communication for better monitoring the threat, but it will also allow the company to advise you of any other steps you should take to secure your account.
Run Virus Detection Software
Once active steps are being taken to resolve the threat, run a virus detection software to reveal if the hacker gained access through one of your devices.
If this is the case, then you should certainly take further action with your bank and work on changing the passwords of any accounts kept on the hacked device.
Stay Alert For Further Threats
The end of the resolution process will result in one of two outcomes after the account is secured. Either the threat is deterred before causing any significant damage or funds are stolen from the account.
The hope will, of course, always be for the former, but the chances of the latter happening do exist. What can be done if the situation reaches this point? Let’s take a look.
Should You Follow The Money?
Cryptocurrency, whether traded or stolen, will leave a trail on the blockchain. For victims of security breaches, this heightens the appeal of going to search for the stolen funds since they are traceable to some extent.
The traceability of crypto gives hope to those who have been attacked, but the process of locating stolen funds can be more difficult than it seems.
Verify Your Coverage
Unlike fiat banks, crypto exchange platforms are not FDIC-insured. This means that while traditional banks assure money stolen from an individual’s account will be covered up to a certain amount, crypto platforms are not provided this same protection.
The protection that customer-centric platforms offer comes in different forms. At Vauld, for instance, we’ve partnered with BitGo, a leading digital asset trust and security company.
We provide coverage for our customers by moving funds from the investor’s wallet to a centralized lending pool that’s insured for $100 million in BitGo. You can recover your stolen funds even if a major breach takes place.
Because we’re always considering new ways to innovate platform security while users build their wealth, the team at Vauld is also developing a new insurance fund to be released in late 2021 for even more safety coverage.
Call The Police
Stealing anything — even crypto — is a crime. Contact law enforcement and report the criminal activity to hand the case over to a team that has more resources for locating cybercriminals and alert them to other possible occurrences.
Stay Secure From The Start
Earning interest through a crypto savings account is a great way to create a passive income, but the threats are real and should be taken seriously. Being aware of the steps to take before and after an attack will keep your funds as safe as possible.
The best way to protect your account against any scenario is by knowing you’re in good hands from the start. At Vauld, customer protection and company transparency are always top priorities so you can have the best earning experience without sacrificing their security.
Along with an arsenal of security features, Vauld users get competitive rates, regular upgrades, and the highest quality of customer service.
To begin safely earning interest with your crypto account, sign up with Vauld today.