Security is one of the major selling points of cryptocurrency. But with a host of issues and compromises over the last year, millions of people are wondering just how secure their virtual holdings really are. In fact, it’s something we should all consider.
Common Cryptocurrency Security Risks
Though new attacks are emerging on a daily basis, most crypto security risks can be placed into one of three buckets:
- Phone-porting attacks. This is where criminals seek out message board threads and social media discussions to identify crypto users. They then monitor things like phone numbers and emails until they get enough
information to gain access to the user’s wallet (which they eventually empty out). - Ponzi schemes. There’s a huge lack of cryptocurrency education in the marketplace. This gives criminals ample leverage to trick unsuspecting individuals into forking over cash for fraudulent or fictitious virtual currency.
- Phishing attacks The most common (and preferred)
method of attack involves phishing. This is where perpetrators pose as
financial companies and trick users into giving up their digital wallet login
information.
5 Ways to Keep Your Crypto Safe and Secure
Whether you have the cash equivalent of $500 or $5 million in cryptocurrency, it’s imperative that you protect it with sound security strategies and tactics. Here are a few recommended suggestions:
1. Choose the Right Infrastructure
You have a basic understanding of the cloud, but what is cloud security? And why is it so important?
In essence, cloud security refers to the policies, technologies, and controls that protect data and digital assets – like cryptocurrency – from theft and other cyber threats. Unfortunately, many people and companies don’t use the proper cloud computing setup. This allows hackers to come in and take whatever they want.
If you don’t understand cloud security, partner with someone who does. This isn’t something you can afford to gloss over.
2. Get a Hardware Wallet
Ironically enough, the safest way to store your crypto is in a hardware wallet. (Yes, you need to keep your digital assets in a physical wallet). These wallets store private keys inside of an impenetrable circuit, which lets you sign transactions with just one click.
The key is to select the right hardware wallet. Pricing is one factor, but it’s
not the only one. Think about things like supported currencies, display
screens, and physical durability.
not the only one. Think about things like supported currencies, display
screens, and physical durability.
3. Use 2FA for Everything
There’s no excuse for using a single password to access your virtual currencies – no matter how complex the password is. Two-factor authentication is a must (even if it makes logging in more time-consuming).
Two-factor authentication requires you to have two different methods – usually two different devices – to access an account. This significantly reduces the risk of a remote attacker compromising your account. (At the very least, it makes it more difficult.)
4. Spread the Wealth
You’ve heard the saying that you shouldn’t put all of your eggs in one basket. Well, this age-old wisdom applies to cryptocurrency as well.
One of the best things you can do is to spread your money across multiple wallets. This ensures that, should you be hacked, only a portion of your assets are compromised. (As a side note, mobile wallets should only be used for funds that you plan to spend relatively soon.)
5. Back it Up
Make sure you’re also protecting your digital assets from yourself. If you’re using a digital wallet, backing up your information can help you retain access in the unfortunate event that your computer crashes.
Your public and private keys are the most important information you have. That’s all you need to retrieve your balance and access your currency. The wallet application on your computer is irrelevant. Back up this information regularly.
Security Comes First
The future of cryptocurrency is bright – this much we know. But in order to enjoy the full benefits of an investment in crypto, you have to prioritize safety and security. Otherwise, you’ll end up exposing yourself and your investments to dangerous external threats.
Let this article serve as a primer as you develop your own security framework. Dig into the details and stay current on new developments as they emerge. This isn’t an issue you can afford to take lightly any longer.