Bitcoin has been fluctuating a lot in price since reaching record highs of $17,956 in December and as more people are using the currency in becomes imperative that you keep your money safe and secure.
Bitcoin exchanges and users have been hacked in the past and only last month South Korean cryptocurrency exchange Youbit filed for bankruptcy after a cyber-attack saw 17 per cent of its assets stolen.
Unfortunately, Bitcoin transactions are irreversible so once the money is stolen it can’t be returned.
To get around this, Bitcoin has suggested using a ‘cold’ wallet to store the currency The Independent has reported.
This is something such as an external hard drive or even a USB stick.
Usually, the cryptocurrency is purchased via online exchanges although this can be vulnerable as in December 4,700 bitcoins were stolen from the NiceHash exchange – around £46 million.
Speaking to The Independent, Kaspersky Lab’s Alexey Malanov said: “The ever increasing value of cryptocurrencies, especially bitcoin, makes them a very attractive target to cybercriminals, who use various methods to get their hands on them.
“There have been several huge hacks of cryptocurrency exchanges in the past and the trend will only continue.”
While Symantec threat researcher Candid Wüest added: “The safest way for users to store their bitcoin is to use offline wallets which are not connected to a computer.”
Some investors still aren’t convinced by bitcoin with Warren Buffett being one of its biggest critics.
He said: “In terms of cryptocurrencies, generally, I can say with almost certainty that they will come to a bad ending.
“When it happens or how or anything else, I don’t know.
“If I could buy a five-year put on every one of the cryptocurrencies, I’d be glad to do it but I would never short a dime’s worth.”