Rule number one is to take good care of your secret “private key” – the password for accessing and using your Bitcoins. If the private key is secure and no one else can get to it, then your Bitcoins are safe. But keep in mind that if you lose your private key, even you yourself won’t be able to access your funds.
Choose a reliable wallet that fits you, as it will act as a bank account to access your funds. They can be stored both online or offline.
When spending or exchanging your Bitcoins, it’s important to choose the most reliable and trustworthy services. If you fall victim to fraud using a traditional bank card, laws and regulations may help you recover any losses. For Bitcoin, such protection is yet to come. Also, remember that payments with Bitcoins are non-repudiable – once you pay, the money’s gone. If you make a mistake – say you pay USD 222.2 instead of USD 22.22 or send the Bitcoins to the wrong address – you can only rely on the goodwill of the receiver to get your money back.
You may have heard about the anonymity Bitcoin users enjoy. Well, it’s only partly true. While everyone can track any wallet and its content on the network, they can’t identify the owner of the wallet. Bitcoin wallets and transactions aren’t linked to personal data or identity. But there are alternate ways to find out the owners identity. For example, you may be required to reveal your identity when registering on a cryptocurrency exchange. That way all your transactions from the exchange may be traced back to your wallet. Still, if you need stronger privacy, the TOR browser, and other privacy solutions. There are many privacy-oriented Bitcoin wallets, too, as well as other cryptocurrencies with integrated privacy and anonymity features, such as Dash, Monero and Zcash.
Another key issue to watch are regulations. More and more countries are likely to start introducing Bitcoin laws, which could affect how the cryptocurrency can be bought and spent, its legal and tax implications. Alongside the rules, new regulations may also grant Bitcoin users more rights, protection, and clarity.
