Cryptocurrency thefts are on the rise. What can you do to keep your digital assets safe?
There are now over 1,500 different types of cryptocurrencies, 22 million wallets for storing them, and thousands of exchanges to trade them on. This rise in numbers over a short period since Bitcoin introduction in 2008 turned a multitude of crypto users and traders into millionaires in the process. And although the lucrative investment has increased the pocket size of many, it also brought in those who want to take advantage of it.
Within the first nine months of 2018 alone, cryptocurrency theft has led to the loss of nearly a billion dollars, a 250 percent rise from a previous year. Whether it is through the hacking of exchanges, such as the $500 million Coincheck hack, or the theft of a few dollars from a wallet, cryptocurrency thieves are finding new means of taking your cryptocurrencies. Phishing, brute forcing and phone-porting are just a few of the methods used by crypto thieves to steal your cryptoassets, but there are ways to prevent them.
How hackers can steal your cryptoassets
Phishing has been around for quite some time, and it is no longer only utilized by princes of foreign lands requiring your credit card information. The technique has been expanded for cryptocurrency theft, too. Hackers send emails to various cryptocurrency owners, and when opened, infect computers with malicious malware, at times even holding a victim’s computer hostage until a cryptocurrency ransom is paid.
Brute forcing relies on hacking programs, often purchased through the dark web, which use a trial and error approach to gain users’ passwords. If the program doesn’t pick up your password on the fifth try maybe it’ll get it on a try five thousand. All that matters is that once the program achieves what it was built for, you can say goodbye to your cryptocurrencies.
Phone-porting occurs when a hacker uses a victim’s telephone number to take over his/her mobile account. Then hacker accesses the victim’s exchange account by resetting the password with the telephone number and then steals cryptocurrency from the account.
Ways to protect your cryptocurrency
Although the alarming amount of schemes available to hackers to steal cryptocurrency may seem menacing, there are many simple steps that can be taken to ensure the safety of your digital assets, including antivirus software, multi-factor authentication, and just general safety rules.
Antivirus software has been expanded specifically for cryptocurrency use. Companies like Comodo have developed a list of products armed with the tools necessary to identify if files are infected with malware or equipped to take over your computer. These companies offer a variety of services with the purpose of keeping both your computer and cryptocurrency safe.
Multi-factor authentication requires that users input multiple passwords in order to access their digital assets. It also adds an extra layer of security and a preventative system in that if someone were to hack into your wallet and attempt to change your password, you would be notified immediately via your secondary authentication method, such as a mobile phone. It may seem tedious, but various programs have been developed to simplify and streamline the process. Taking a few more minutes to input passwords is better than losing all the digital assets you have gained so far, right?
Education and diligence
One of the easiest and most valuable ways to protect your cryptocurrencies is simply through education and diligence. If you see a suspicious email, run it through your antivirus software or just simply don’t open it. Keep being updated with current cryptocurrency theft trends. If an exchange requires your personal information, do your research, make sure it is reliable, secure and well-known. Consider cold storage for wallets, companies like KeepKey offer a variety of hardware to keep your cryptocurrencies safe. Be wary of who you’re giving your information to and what services are available.
Data encryption is the best method for securing your cryptocurrency data when your device is stolen. It basically works by translating your data into a code, which can only be unlocked with a decryption key. Various products are already available on the market, which can aid you in doing so.
For PC users, VeraCrypt is a solid data encryption software; FileCrypt is another downloadable encryption service. Data encryption, used with anti-virus software, multi-factor authentication, and cold wallets, should be more than enough to ensure the safety of your cryptocurrencies.