Here are a few simple ways to keep your cryptocurrency wallets secure.
It may appear that protecting your cryptocurrency is a difficult task. Hot and cold wallets, online exchanges, and private keys are all on the learning curve for the uninformed.
Experts in digital security advise that you don’t scrimp on your research, especially when it comes to the hardware and software wallets that are used to store data that validates cryptocurrency ownership. Because of the decentralized nature of many digital coinage, stolen cryptocurrency is frequently lost, unlike a stolen credit card number, which can be an inconvenient but manageable problem.
You might not have somebody to turn to if you encounter troubles.
Because cryptocurrency can be stolen over the internet, hackers are attracted to it. This means that victims are often spread across the globe. Even if hackers are identified, they may be located in countries where extradition is difficult, such as Russia, thus the risk of punishment is minimal. And it’s difficult, if not impossible, to track down Bitcoin.
According to Don Pezet, co-founder of the online IT training company ITProTV, cryptocurrency carries security dangers that other types of investing don’t.
“If a hacker steals your money, it’s gone,” said Pezet, who is also the chief technology officer of ITProTV’s parent business, ACI Learning.
The greatest thing you can do, he argues, is make sure your cryptocurrency is secure from the start to avoid problems later.
Cybercriminals are continually threatening cryptocurrency exchanges, where investors can purchase and trade one currency for another.
Cybercriminals exploited a vulnerability in Poly Network, a platform that connects several blockchains, the online digital ledgers that record bitcoin transactions, in August, resulting in one of the largest thefts of all time. The hackers gained access to Poly and plundered it for $600 million, albeit the funds were eventually recovered.
Not every hack makes the news. Individual investment wallets are also being targeted by cybercriminals, who use many of the same ways to get access to other online accounts. If you fall for a phishing scam or allow your devices to become infected with malware, you run the danger of being robbed.
According to Andrew Gunn, senior threat-intelligence analyst at ZeroFox, while individuals may be concerned about being targeted by attackers, they may be the biggest threat to the security of their Bitcoin.
“We can’t afford to lose sight of the human factor,” Gunn argues.
Expert guidance on how to safeguard your digital assets is provided below.
How to protect your crypto currency
For long-term storage, choose a “cold” wallet. Cold wallets keep the data confirming bitcoin ownership off the internet, making them considerably more difficult to access for cybercriminals. Cold wallets are the safest option, according to both Pezet and Gunn.
A USB drive can be used to hold the private keys to your cold wallet. You can also print and file them on paper. In any case, without them, an attacker will be unable to access your cryptocurrency.
The disadvantage of this type of storing is that you are totally responsible for its security. You can’t get your cryptocurrency if you lose the USB device or misplace your file.
“There is a huge amount of unclaimed crypto out there from these types of scenarios,” Gunn said, adding that some users have turned to password crackers to gain access to their accounts after forgetting their passwords.
Cold wallets are also inconvenient compared to hot wallets, which are hosted online, typically by a cryptocurrency exchange. If you use cryptocurrency for day-to-day spending, Gunn argues that keeping some of your assets in a hot wallet is fine. He does, however, advise everyone to adequately secure their accounts in order to make them more difficult to crack.
Keeping as little cryptocurrency in hot wallets as possible is also a good idea. There’s not much you can do if your funds are taken.
Gunn recommends employing a combination of cold and hot wallets, each with its own password. You’ll be limiting the fallout if the worst happens.
Multifactor authentication and strong passwords should be used. As with other digital accounts, securing your Bitcoin with strong passwords is a must. At least 12 random characters are involved.
Two-factor authentication, which needs a second form of identification such as a fingerprint or a push notification to your smartphone, also aids account security. If your password is compromised, it will go a long way in keeping you safe.
To gain access to your wallets, use only your own smartphone. Although it may appear to be handy, never use a public computer, such as one at a library or a hotel business center, to access your cryptocurrencies. It’s impossible to know if they’re diseased.
Likewise, ensure that your gadgets are well-maintained. Maintain the latest versions of your antivirus software and operating systems. Always utilize a secure internet connection, preferably one that is backed up by a VPN, according to Gunn.
Do your homework. Exchanges that are larger and more regulated are generally safer. If you’re going to utilize it as a hot wallet, make sure it’s a reliable one.
Be cautious of emails purporting to be from the firm that manages your cryptocurrency wallet. It might be a phishing email designed to steal your login information and, eventually, your money.
It’s usually preferable to avoid any included hyperlinks and go straight to the company’s website, just like it is with emails that appear to come from your bank.