Here are a few tips to help you protect yourself when using digital currency.
Protect your wallet
Take steps to protect your wallet:
- keep your wallet, and any backups, in a safe place
- encrypt your wallet using encryption software
- encrypt any copies you make or online backups
- set a password to help prevent thieves from withdrawing your funds
- use a strong password that contains letters, numbers and symbols
Know the merchant’s refund, return and dispute policies
Before you make a purchase, find out:
- what the exchange rate will be
- if refunds are available
- if refunds will be processed in digital currency, Canadian dollars or store credit
- how to contact someone if there’s a problem
Wait for multiple confirmations before completing a transaction
It can take 10 minutes or more for a digital currency transaction to be confirmed. Confirmation happens when users on the network verify the transaction. During that time, a transaction could be reversed and you could lose your funds to a dishonest user.
Understand what the actual costs will be
Find out if there are any mark-ups or other fees. Find out what will happen if the rate changes before the exchange is completed.
Think about the future
Consider what will happen if you fall ill or die and can no longer access your wallet. If no one knows the locations and passwords of your wallets when you are gone, the funds can’t be recovered. Consider having a backup plan for your peers and family.