Wallet Security Multiple Wallet Setup When actively trading or exchanging crypto and/or NFTs it is important to adhere to strict security standards. One of the most widely used and effective strategies is having multiple “layers” of wallets setup for different use cases. Ideally, you should have at least 3 separate “layers” of wallets each with varying levels of use and access to different dApps or platforms. We already discussed “Hot” and “Cold” wallets, but in reality your “Hot” wallets should be separated into 2 different “layers”: A “Warm” wallet and a “Hot” wallet. 1. Layer 1: Hot Wallet - This wallet is where you only store funds that you are absolutely willing to lose. The purpose of this wallet is to allow you to experiment with new platforms and move funds quickly in and out of areas that you may not fully trust, but need to access on the fly at any given moment (ie DEXs, NFT minting sites, unverified gaming platforms, etc). This wallet may also be referred to as a “Burner Wallet” as it is the most replaceable and should be changed regularly whenever you connect it to a dApp or platform that is questionable or has become compromised. 2. Layer 2: Warm Wallet - This wallet is where you store funds and other assets that you need regular access to and need to be able to use with dApps and other platforms, but is still not connected to most things. You should only connect this wallet to dApps that have been thoroughly vetted and that you trust fully. It is not completely secure like a Cold wallet, but it should be secure enough that you feel confident keeping somewhat larger sums of assets here without fear of being phished or exploited. 3. Layer 3: Cold Wallet - This wallet is where you secure your funds and assets for long-term storage or any amount that you are not willing to risk AT ALL. You would never connect this wallet to ANY dApp or other platform under ANY circumstances. The only use for this wallet is to receive funds into or send funds out and only to and from one of your own other wallets. It is advised to not even share the public key for this wallet. If you need to receive funds from someone else it is best to share the public address of one of your “Warm” or “Hot” wallets and then send the funds or assets from one of those to your “Cold” wallet yourself. This increases security by obfuscating your holdings to prying eyes that may be looking at your activity on the blockchain. Ideally, this wallet is managed through a hardware wallet such as Ledger or Trezor. ATTENTION: NONE OF THESE WALLETS SHOULD SHARE THE SAME PRIVATE PHRASES! THEY SHOULD BE TOTALLY SEPARATE WALLETS!!
Pocket Universe Security Extension One of the most widely used & trusted security extensions is Pocket Universe , available on Google Chrome and other Chromium based browsers. Pocket Universe is an extension that provides a detailed explanation, in layman’s terms, of every transaction that attempts to have you sign it with your wallet and tells you whether or not it is safe and/or from a trusted source. They also offer a $20,000 insurance on any transactions that they deem “safe” in the event your wallet becomes compromised by said transaction. Pocket Universe is an invaluable tool that should be installed and active at all times in EVERY browser that you use crypto with. Unfortunately, Pocket Universe is only currently available on desktop/laptop and not on mobile devices. What is the Blockchain? The “Blockchain” is a decentralized ledger (record) of every single transaction that occurs on a specific cryptocurrency network. It provides a transparent way for anyone to see and verify transaction history of any wallet or contract without the need for 3rd party confirmation. Etherscan is a blockchain explorer that is used to view transactions, network status, and block history of Ethereum transactions while Bitaps is one that may be used to view Bitcoin transactions. Blockchain.com is one that may be used for multiple cryptocurrency networks. Reading the Blockchain You may visit any of the sites above (depending on which networks transactions you wish to view) to read transaction history of any wallet or contract. Simply enter the wallet or contract address into the search bar and it will display the transaction history of that address in real-time. This is another invaluable security tool that every person who deals with crypto in any capacity should become familiar with. It may be used to verify transactions existence, success, or failure or verify ownership of a wallet or address of a person that claims it may be theirs.