The economic impact of the Russia-Ukraine conflict has taken a significant toll on the profitability of investments across markets that were already locked into post-pandemic recovery mode. Still, predictions have generally kept cryptocurrency outside of this rule, with experts even predicting that crypto could become ‘digital gold’ as conflict reigns on. Unfortunately, as Russia increasingly looks set to rely on cryptocurrencies to work around increasing sanctions, these predictions might not prove the reassurance that they seem.
Instead, cryptocurrency investments that already faced the highest numbers of scams to date seem to be at an increased risk of fraudulent behavior (70 percent of which can be linked back to Russian ransomware) and the losses inherent in that.
This is especially true in light of the sizable donations that crypto investors have already made to Ukraine, with as much as $50million used for this purpose. Hence, investors looking to protect cryptocurrency or put it to good use as the conflict rages on must consider the following ways to protect their digital stockpiles:
# 1 - Cold Wallets
As crypto risks continue to rise, anyone considering investing in cryptocurrency must understand the safest way to store those investments. Cold wallets that take cryptocurrencies away from currently vulnerable trading platforms to private offline encrypted ‘wallets’ are increasingly gaining popularity, and can provide an added layer of security that even online insurance is currently struggling to uphold. Wallets of this nature can prove especially beneficial for protecting cryptocurrencies when used alongside further measures such as two-factor authentication, entirely private cold wallet keys, and an understanding of the updates/precautions necessary to best protect investments stored here.
# 2 - Wise donation decisions
The influx of crypto-based Ukrainian donations is one of the most promising stories to come out of the Ukraine/Russian conflict, but investors looking to help with this survival effort must also protect themselves in the process. After all, with multiple fraudulent charities currently cropping up for this purpose, donations will not only fail to help anyone in Ukraine but will ultimately leave investor profiles empty and unable to do anything further. Experts especially recommend avoiding donation to any third-party charity, instead sticking to donations that are only ever made directly to the Ukraine government, which has already shared its cryptocurrency wallet address via Twitter.
# 3 - Increased security in general
More generally, increased cryptocurrency risks require a more vigilant, secure approach to crypto investments made at any level, meaning that investors must more diligently understand the precautions/insurance offered by any investment platform before committing. Equally, protection of existing investments regardless of where they’re stored is reliant on the regular changing of complex passwords, trades that are only ever accessed via branded apps/resources, and avoiding links or download attachments, even if they claim to be from your trading platform of choice.
The Russia-Ukraine conflict has left investments in turmoil for a range of reasons. Make sure that your cryptocurrency accounts don’t feel that same pressure by always protecting those investments using these pointers.
Also Read: 5 ways to maximise returns on investment amid current economic turmoil