A false sense of security.
Last time we spoke about blockchain. It is true that cryptocurrencies can feel secure because they decentralize and often anonymize digital transactions.
Let’s see what we can do to guard our selves against a swath of common attacks.
Guard yourselves against cryptocurrencies threats
In reality, nothing can be further from the truth. Whilst the landscape of owning cryptocurrency isn’t as abstract as it was at the beginning of the decade, still, investors face plenty of instability and risk. The threats aren’t just abstract or theoretical; new scams crop up, and old ones resurface all the time.
Starting with the basics.
A key step to protecting your digital cash is to store anything of significant value in a hardware wallet. A physical device, like a USB drive, that stores your private keys and currency locally and isn’t connected to the internet. The public-facing internet gives the attacker a plethora of pathways to infiltrate your wallet or trick you into giving them access.
Experts caution against storing large amounts of coins through cryptocurrency exchanges, or in digital wallet apps on your smartphone or computer.
Your setup doesn’t have to be fancy; you can store backups of your coins on any external storage device, like a portable hard drive. Just make sure to encrypt the data in case the device is lost or stolen.
The downside to a hardware wallet is that it makes approving transactions a bit time-consuming. For easier access to your cryptocurrency, store a small amount in a wallet app to simplify low-value transactions.
Only keep an amount you would be willing to lose in the app, and never give anyone your private key.
There are several apps in the market, with sound encryption and privacy features. Still, experts advise not to trust any app with too much of your crypto cash right now.
Also consider your transactions carefully. There are tons of established, reliable institutions, but gimmicky new cryptocurrencies crop up all the time, as well as questionable Initial Coin Offerings that could have nothing behind them but scammers on the move.
It’s important to remember that all the small things you’re already doing to protect your general digital life help defend your cryptocurrency as well. Experts suggest:
Use a password manager, use two-factor authentication, leverage enhanced security protocols for your email address.
Taking it a step further.
Once you have nailed the basics make sure your friends and family adopt the same mindset. The more secure the ecosystem, the less attractive a target it is to potential predators.
The best way to defend against any attack is simply watching all transactions carefully, and to safeguard your assets so you know your data hasn’t been exposed.
8 simple steps to secure cryptocurrencies
To summarize:
- Store anything of significant value in a hardware wallet;
- A physical device, like a USB drive, that stores your private keys and currency locally and isn’t connected to the internet;
- Use a password manager; also use two-factor authentication;
- Just make sure to encrypt the data in case the device is lost or stolen;
- Only keep an amount you would be willing to lose in the app, and never give anyone your private key;
- Consider your transactions carefully;
- Make sure your friends and family adopt the same mindset;
- Simply watch all transactions carefully.
Until next time…