Cryptocurrency has come into our lives and continues actively shining with its huge opportunities and rainbow retrospectives. However, there can be rainy days even in the sunniest land. Thus, experts explained what can happen if you ignore security rules and gave recommendations to help protect digital assets from hackers.
Rule #1 Saving Personal Information
To work with crypto-assets, you should use separate accounts, such as email and phone numbers, different from the main ones, – advise crypto professinals. According to them, in this case, even if public data is matched, the accounts will be safe from fraudsters. They also recommend not to disclose personal data in the public domain in any case, such as in social networks, messengers, or blogs.
They also suggest using a separate email and phone number that are not used on other resources. At the same time, it is important to use a phone number that belongs to you so that in case of need there is a possibility to restore the SIM card.
Rule #2 Protecting Your Account
Two-factor authentication (2FA) is a method of user authentication when logging into a service that requires at least two ways to confirm that the user is the owner of the account.
Two-factor authentication can provide additional account security. When used in combination with other security measures (for example, a number of exchanges allow additional passwords for transactions), it can significantly increase the level of account security. Thus, it is necessary to use the maximum set of security features: SMS confirmation, anti-phishing code, two-factor authentication, and email verification code.
Rule #3 Asset Allocation
The experts recommend separating cryptocurrency into different storage so that if one wallet is accessed, fraudsters won’t have the opportunity to steal all funds. Small amounts can be left on exchanges and their online wallets, but larger savings are better stored on hardware devices. There are crypto projects that use bug bounty platform which means that they can be trusted.
Rule #4 Decentralized Exchanges
Decentralized cryptocurrency exchanges do not store crypto-assets of users but simply organize their interaction. The peculiarity of this approach is that the user himself keeps his savings and is responsible for their safety, rather than transferring them into the possession of third parties. Also, the exchange can’t block or cancel the transaction. The experts note that this approach has disadvantages. For example, all transactions conducted will be irreversible.
It is extremely important to monitor what permissions the decentralized protocols ask you for when interacting with the wallet. Often these are standard permissions for working with cryptocurrency assets, but if you see a different request, it is better to once again check both the project itself and the possibility of a phishing attack.
Basic security principles
There are also some basic security principles, which should be observed when working not only with cryptocurrency assets, but also with fiat funds.
- Carefully record and save recovery codes for two-factor authentication;
- Don’t use easy simple passwords like 321A123a;
- Write trusted ip-addresses;
- Do not store the whole seed phrase in one place. It is better to split it into two parts and hide it in different places. (Seed-phrase is a set of random 12,18 or 24 English words, which is used to restore a cryptocurrency wallet);
- Be attentive to wallet updates, if the update is fraudulent, you can instantly lose your funds;
- Before you start actively using your wallet, you should try to delete it and restore it via a phrase.
How Cryptocurrency is Stolen Without Hacking
Sometimes attackers don’t even need direct access to a victim’s wallet to steal their money – all they need is to mess with the owner’s head, and he’ll give it all up himself.
For example, almost everyone heard about the situation when scammers had hacked the Twitter accounts of Elon Musk, Bill Gates, Kanye West, and some other celebs, and posted offers to double the number of coins sent by users in their wallets. In such a way, they needed just a few hours to steal over $100,000.
Even if you are sure you would never fall for such a trick, be vigilant – the fraudsters regularly come up with new deception schemes. If someone offers you money for no reason, think about the motives of such generosity. And if it came to ask you to pay some amount in advance, you are probably being lured into a trap.
And it is in the crypto sphere, many projects of which are adventurous by their nature, where scammers are most active, counting on the user, who is used to the unconventional behavior of the crypto world in general, to buy their assurances.
To be sure of the safety of their funds, many exchanges are improving their security methods. But it is also a concern for ordinary users who use cryptocurrency. Ignoring security rules can lead to the fact that all savings in cryptocurrency will be irretrievably lost.