How to Protect Yourself while Using Crypto – Guide

Bitcoin, the largest cryptocurrency, has just reached a trading value of over $12,000, the highest since August 2019. Cryptocurrency price fluctuations are unpredictable, attracting investors and crooks. Numerous hacks and robberies have been recorded on cryptocurrency exchanges and cryptocurrency wallets since their inception in 2009. According to the “2019 Anti-Money Laundering (AML) Report” published by blockchain security firm CipherTrace, cryptocurrency crimes totaled $4.3 billion globally in 2019. In 2019, hackers stole over $125 million worth of Ethereum, Bitcoin and other digital currencies from various cryptocurrency exchanges. Cryptocurrency wallets (digital wallets) and exchange providers are the main threats to your digital currencies. A crypto wallet does not store your digital money, but includes a private key that allows you to exchange bitcoin over the internet. This private key serves as your digital identity on the bitcoin market, and anyone who obtains it can carry out fraudulent transactions or steal your money. To hack digital wallets and steal/transfer crypto without the user’s knowledge, cybercriminals employ complex approaches. When it comes to protecting your digital money from hacks, protecting your wallet is key. Here are some options for securing your cryptocurrency:

How to Protect yourself when using encryption

  1. Use a cold wallet Unlike hot wallets, cold wallets do not connect to the internet, so they are not prone to cyber attacks. Storing your private keys in a cold wallet, also known as a hardware wallet, is the most viable option as they are encrypted, keeping your keys safe. In 2019, Japanese exchange BITpoint discovered an unauthorized withdrawal of $32 million from its hot wallet in different cryptocurrencies targeting over 50,000 users. The exchange held five cryptocurrencies in its hot wallet: Bitcoin, Bitcoin Cash, Ethereum, Litecoin, and Ripple. However, BITpoint clarified that its cold wallet and cash deposits were not affected in the incident.
  2. Use Safe Internet When trading or making cryptographic transactions, use only a secure internet connection and avoid public Wi-Fi networks. Even when accessing your home network, use a VPN for additional security. A VPN changes your IP address and location, keeping your browsing activity safe and private from threat actors.
  3. Keep multiple wallets As there is no limitation for creating portfolios, you can diversify your cryptocurrency investments across multiple portfolios. Use one wallet for your daily transactions and keep the rest in a separate wallet. This will protect your portfolio and mitigate the loss of any breach in your crypto account.
  4. Secure your personal device Make sure your personal device is up updated with the latest virus definitions to defend against newly discovered vulnerabilities. Use a strong antivirus and firewall to improve your device’s security and prevent hackers from taking advantage of the weakness by writing code to attack the vulnerability.
  5. Change your password regularly We cannot underestimate the importance of a strong password when talking about security. According to one study, three-quarters of US millennials use the same password on more than 10 devices, apps, and other social media accounts. It also stated that most of them were using the same password in over 50 different places. Make sure you have a strong, complex password that is difficult to guess, and change it regularly. Use separate passwords if you have multiple wallets. Opt for two-factor authentication (2FA) or multi-factor authentication (MFA) for added security.
  6. Don’t get phishing Phishing scams through malicious ads and emails are common in the cryptocurrency world. Be careful when making crypto transactions and avoid suspicious and unknown links. In a recent cryptocurrency heist, a hacking group “CryptoCore” targeted cryptocurrency exchanges through spear phishing campaigns. Attackers stole $200 million worth of cryptocurrencies in two years, targeting companies in the US and Japan since 2018. ClearSky stated that CryptoCore has begun a reconnaissance phase to identify the email accounts of security employees and executives. cryptocurrency exchange before carrying out a spear phishing attack. These attacks were carried out using fake domains impersonating affiliated organizations and employees and embedding malicious links in documents via emails.

Final note

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