4 Tips to Protect Cryptocurrencies from Hackers
The idea behind Bitcoin and the Blockchain technology was to develop a payment method that can provide quicker, easier and safer means of payment. As Ethereum, Litecoin and other cryptocurrencies appeared on the scene, massive influx of money poured into the cryptocurrency world and it became a billion dollar financial market. Analysts expect it to cross the trillion dollar mark in a year or two.
Unfortunately such markets are also noticed by cybercriminals. Cybercriminals have been the bane of many organizations and businesses and they have now found a new target to attack – crypto traders. Fortunately, their threat can be avoided by following certain security measures.
1- Trusting the Security of Major Crypto Exchanges
Many people do not move their assets from the cryptocurrency exchange to their wallets. They trust the security measures of an exchange to protect them. However, one should only rely on the security of one’s own wallet. In the past, many reputable exchanges like Mt. Gox, Binance, Bitfinex and several others have been affected by cyberattacks. Many traders had to incur major losses as a result of these breaches. Thus, traders should be careful about storing a significant portion of their funds in an exchange.
2- Two-Factor Authentication
Earlier, cybercriminals were able to crack user passwords easily, allowing them access to user accounts in exchanges. However, many exchanges realized this and started offering two-factor authentication. Two-factor authentication is a security mechanism that not only requires the ID and password of users but also requires an extra unique detail that is associated with each user. Two-factor authentication has made it harder for cybercriminals to operate and thus one should always choose exchanges that allow the use of it.
3- Choice of Wallet
There are many wallets available for storing a cryptocurrency. There are web wallets, mobile wallets, desktop wallets, hardware wallets and paper wallets. However, the choice of a wallet is determined by one’s security needs and one should think about those before choosing a wallet to store life savings.
A web wallet is convenient to transfer funds easily but as it is directly connected to the Internet, it is a risky option. Mobile wallets have the same problem along with the added threat of attack from crypto malware apps. Desktops wallets can be secure if they are installed on a computer without access to the Internet. Similarly, hardware and paper wallets minimize the chance of funds being hacked.
4- Online Activities
One can take all security precautions but still end up being hacked. The reason behind this is an irresponsible use of the Internet. Cybercriminals often send emails and links to users that contain malicious scripts and infect users’ PC with a malware. These malware often have a key-logging or spyware component that stealthily observes and sends user keystrokes to the hacker. Hence, crypto traders have to be careful while opening an email, website or an app. Moreover, public WIFIs should be especially avoided as cybercriminals often use them as a medium to attack.
Criminals are always lurking in a financial market whenever there is an asset of value involved. Therefore, crypto traders have to be careful with their cryptocurrencies and follow the above tips to minimize the chance of a hack.