1.3: A Word About Security

We can't stress enough the importance of understanding the security requirements and demands placed upon you if you want to be involved in cryptos in a serious way.

If you are simply curious about their potential, and your involvement (at this stage) is going to be limited to very small amounts of fiat currency that you don't care if you lose, then no need to sweat this module or the next for the time being.

But you only need to go a little way on your crypto journey before you will want to understand more about the security issues around cryptos. You will want to understand the concept of private keys. You will need to know how private keys relate to the myriad ways of storing and exchanging cryptos.

If we think about storage, the most common initial reaction is to think of your crypto wallet as being like a bank account.

YOUR CRYPTO WALLET IS NOTHING LIKE A BANK ACCOUNT.

This is a key point that you must understand.

• If you deposit money into your bank account and the bank goes bust, your funds are protected by the UK government up to a maximum of £85,000. If you deposit cryptos into an online entity (e.g. an exchange) and they go bust, your funds have gone.
• If you deposit money into your bank account and you suffer fraud, your bank will try to retrieve your funds or will reimburse you. If you deposit cryptos into an online entity and you suffer fraud, your funds have gone.
• If you deposit money into your bank account and you forget your online banking password, you will always be able to retrieve it. If you deposit cryptos into an online entity and you forget your password, you may not be able to retrieve it.

Security should be very high on your list of concerns. We will provide all the practical answers in the modules to come. But we must start with some technical information. Deep breath, don't panic, we will make this easy for you. Welcome to the world of private keys.

Please feel free to contact us with any questions.