Dos:
1. Take Control of Your Bitcoin
Move your bitcoin into your own self-custody, away from the exchange where you purchased it. This ensures you have full control and reduces the risk of losing your funds if the exchange gets hacked or shuts down.
2. Regularly Dollar Cost Average (DCA)
Consider making regular, measured purchases of Bitcoin. This strategy, known as dollar cost averaging, can mitigate the risk of market volatility and build your holdings steadily over time.
3. Use a Bitcoin-Only Wallet
Opt for a bitcoin-only wallet that is open source. Avoid closed source or multi-currency wallets to ensure maximum security and transparency.
4. Hot Wallet for Day-to-Day, Cold Wallet for Long-Term
Use a hot wallet for daily transactions and a cold wallet for long-term savings. Hot wallets are connected to the internet and suitable for frequent use, while cold wallets are offline, providing enhanced security for long-term storage.
5. Protect Your Seed Phrase
Keep your seed phrase secure and separate from your hardware wallet. Your seed phrase is the key to your Bitcoin; losing it or having it stolen means losing your Bitcoin.
6. Upgrade to Multi-Sig
Once your Bitcoin holdings become a significant portion of your overall wealth, consider upgrading to a multi-signature (multi-sig) setup. This adds an extra layer of security by requiring multiple signatures to access your funds.
7. Follow Australian Laws and Taxation Rules
Ensure compliance with all Australian regulations and tax laws related to Bitcoin. Report your transactions and capital gains accurately to avoid legal issues.
8. Inspect Your Wallet for Tampering
Always inspect a newly purchased wallet for any signs of tampering when you receive it. If anything looks suspicious, contact the manufacturer immediately.
9. Buy Direct or from Authorised Resellers
Purchase your hardware wallet directly from the manufacturer or an authorised reseller to avoid counterfeit products that could compromise your security.
10. Stay Informed About Bitcoin Developments
Continuously educate yourself about Bitcoin and its ecosystem. Staying informed helps you make better decisions and adapt to changes in the technology and market.
Don'ts:
1. Keep Your Holdings PrivateNever disclose the amount of Bitcoin you own to others. Keeping this information private protects you from becoming a target for theft.
2. Protect Your Seed Phrase and Passcode
Never share your seed phrase or wallet passcode with anyone. These are the keys to your Bitcoin, and sharing them compromises your security.
3. Avoid Digital Storage for Seed Phrases
Do not take photos of your seed phrase or upload it to any cloud service. Digital storage increases the risk of hacking and loss.
4. Avoid Second-Hand Hardware Wallets
Never buy or use a second-hand hardware wallet. These could be compromised and pose a significant security risk.
5. Stay Calm During Price Swings
Don't get emotional over Bitcoin’s price volatility. Zoom out and focus on long-term trends rather than short-term fluctuations.
6. Don't Fall for Scams
Be cautious of scams and phishing attempts. Always verify the authenticity of websites, wallets, and offers before proceeding.
7. Avoid Storing Large Amounts in Hot Wallets
Do not keep significant amounts of Bitcoin in hot wallets. These are more vulnerable to hacking compared to cold wallets.
8. Don't Ignore Backup Procedures
Never neglect to back up your wallet. Regularly update and verify your backups to ensure you can recover your funds if needed.
9. Don't Use Public Wi-Fi for Transactions
Avoid conducting Bitcoin transactions over public Wi-Fi networks. Public networks are less secure and can expose your data to potential threats.
10. Don't Skip Updates
Always keep your wallet software and hardware firmware up to date. Updates often include critical security patches and improvements.