How to keep your Bitcoin safe? The ultimate guide for protecting your cryptocurrency
Cryptocurrencies are an excellent tool for making money, paying for good and store of value. However, while some consider them convenient to make a profit because of the decentralized nature and the fact that the cryptos are not regulated by government entities, others find ways to hack your account and steel your coins. While due to volatility it has never been easy to earn at the cryptocurrency market, it is even harder to keep earned funds safe.
While due to volatility it has never been easy to make profit in the cryptocurrency market, especially in a bear market, it is even harder to keep earned funds safe,
It is natural to be concerned about the safety of your investments and look for ways to protect them. The fact that cryptocurrency is an opportunity for hackers only makes these concerns stronger. However, you can protect anything simply by worrying about it. Therefore, further, we will discuss not only the dangers that are waiting for crypto holders but how to avoid them as well.
Last year a record number of cryptocurrency thefts was marked. According to the Coindesk, in 2018, hackers have been stealing the amount of cryptocurrency equal to $2.7 million per day. In 2018, fraud and theft grew 13 times compared with 2017. The amount of money, which was stolen from cryptocurrency exchanges, payment wallets, and other infrastructure services runs into hundreds of millions of dollars.
Thefts are still on
As the industry keeps on developing, which means that it is still the desired aim for hackers. Therefore it is possible that this year, the number of hacks will only increase. At the beginning of the year, attackers uncracked Cryptopia. About 16 million dollars were withdrawn from the accounts, and in two weeks the hacker attack was repeated.
A little bit later, on February Coinmama representatives announced a hacker attack, their servers were hacked, and the attackers stole information about 450 thousand service user accounts. The company itself is committed to providing the ability to purchase cryptocurrency using credit cards. The damage from this hacker attack is still unknown.
How do hackers steal cryptocurrencies?
Ransomware is probably the most frequently used fraud technique. In a nutshell, it is a hacker program (computer virus), which impede entering a computer system or data until a ransom is paid. First, it encrypts some of the files on a computer. Then, the program offers the PC owner to pay a certain ransom, after which files will be decrypted. Hackers are using it pretty often.
First and foremost, never open or download suspicious files to your computer. Moreover, it is better to backup important files. Even though high-quality anti-virus software might be expensive – it can save you a lot of money and nerves.
2. Fake wallets
This method is not so popular, but many users have already become its victim. Fake wallets are websites or mobile apps that look just like a real wallet. Typically, these wallets use logos and the names of existing wallets to trick users. Some fake wallets even appeared in the App Store, having successfully passed its verification procedure.
To protect yourself from this type of fraud, download wallets only from reliable sources, such as the official website, and carefully check the applications you install from the App Store or Play Market.
In short, Phishing is a way to steal sensitive information through internet communication. It can have various shapes, but most often it can be performed via email and fake websites. The aim of fraudsters is to force the victim to share personal information. For example, they can ask to specify the username and password to the online wallet. Usually, such messages look like an official letter, even domain names might be very similar to the address of an official site. However, an attentive user who is aware of such scams is able to distinguish the difference.
4. Fake cryptocurrencies
Onecoin is probably the most famous example of such fraud. Putting money in it, users thought that they are buying a real and profitable coin, while in fact they were scammed.
It is a pity, but no Onecoin blockchain or network of miners have ever existed.
If you want to invest in cryptocurrency and making a decision on which coin to buy, do your own research. Be attentive are recheck every piece of information. Additionally, mind that you can check whether a currency actually exists on sites like CryptoCompare or Coinmarketcap.
A few more tips on how to keep cryptos safe
In order to minimize risks of hacking attacks, pay attention to several basic principles:
1. Information is our friend. The extra information is our enemy.
Limit the distribution of information about your cryptocurrency. Do not brag about it online, even if the total amount in your account is small enough. Your relatives or specialists who help you increase your assets may know about the asset, but you should not report it to everyone. Do not share information on which platform your assets are stored, do not show screenshots from your account, etc.
2. Be attentive while choosing storage for cryptocurrency
In dependence on the type of your crypto activity, you can choose the wallet that satisfies your requirements by providing needed features and keeps your digital money safe as well. There are both online and offline types of wallets and it matters to know the difference in their functionality and the level of security.
If you’ve ever tried to find out how to store bitcoin offline, you most probably know that for this purpose you can use a paper or hardware wallets.
A hardware wallet is a secure device with crypto, stored on it. These wallets are highly secure, though inconvenient for day trading. Nevertheless, if you’re going to hold a significant amount of cryptocurrency, a hardware wallet is most probably an option to select.
Another option is paper wallet is physical storage, which is simply a piece of paper, but with a valuable print of it – public and private keys. It has obvious downsides, caused by the non-durable character of material it is made from.
Mobile wallet is probably the most convenient way to store your crypto. Nevertheless, it certainly is not the safest one, because as any hot storage, it is less safe than a cold one. So, it is convenient to use it for daily needs, but unsafe to consider mobile wallet storage for all your crypto funds.
Web wallets differ in features depending on services, but the principle of functioning remains the same: such storages keep your private keys on a server of a certain company. These wallets are undoubtedly more convenient for trading than any king of cold storage, but they are less secure as well.
3. Password is the main defender
Any of your passwords should not be short or contain explicit associations. Avoid using dates of birth of relatives, simple words or digital sets and make it long enough. You may not believe it, but the most popular password in the world is “123456”. It might seem insignificant while you are creating a password, but in practice, it is better to be safe and spend a couple more minutes making it strong, than being sorry.
4. The safety of your email
Email is an ID in the digital world. Until we pass passport identification on each site, the email is your universal key. And it’s easy to steal. That is why the password from your email should be difficult and constantly changing. In addition, provide a double identification: not only by password but also via phone/another email. For example, when you use Gmail and dual authentication, the system will tell you if someone tries to log in to your account. And if it isn’t you, then you will be notified and the user, who tried to enter your mail, will be blocked.
5. Possibility of physical safe
Those who do not trust e-wallets can buy a physical device for storing cryptocurrencies. There are various options on the market. The bottom line is that you save information on a special hard drive, disconnect from the network and no one without your knowledge will get access to the information.
In accordance with what is said above, we can conclude that though cryptocurrency theft or scam is a frequent occurrence, the safety of your cryptos depends mostly on you. Forewarned means forearmed – you can protect your investments by making research each time you want to try something new (whether it concerns selecting a coin to buy or a wallet to store it). Be attentive and you won’t lose your money. We wish you only prosperity and many more profits!