How to protect your cryptocurrencies from hackers
With the development of digital technologies, it has become increasingly difficult to protect funds from crypto hack and keep cryptocurrencies safe. You can prepare yourself by following some simple but not often obvious rules.
During 2019, criminals stole around USD 4.3 billion in cryptocurrencies. According to CipherTrace analysts, the number of robberies and frauds involving digital money has increased by 150% compared to 2018, and by 2600% when compared to 2017. This suggests that protecting our assets from the crypto hack in the cryptocurrency market is becoming harder every day. We will talk about the most common methods of deception and how to avoid the loss of funds.
Ransomware
One of the most popular ways to steal safe cryptocurrencies is extortion via ransomware. A malicious program encrypts all the data on the victim’s device. After that, it displays a ransom message with a request for a transfer of cryptocurrencies to the hacker in exchange for the encryption password. Being infected by such a virus is very simple. It can happen when you open an infected email or click on a malicious ad.
How to protect yourself from a crypto hack?
The most important rule is to have a reliable antivirus program that can eliminate complex viruses in real-time. It is also necessary to backup your data to prevent a crypto hack. For example, you could store all of your important files in the cloud, on a USB drive or on an external hard drive. After creating a physical backup (USB or external HDD), do not forget to disconnect the device from the computer, otherwise, it may also become infected.
Phishing sites
With the use of phishing sites, hackers try to access your confidential data. Criminals create a page that is very similar to a trusted website, such as a popular crypto broker or exchange. After entering your information into this fake site, the hackers receive the data instead of the actual trusted site. Once the hacker has this information, they can use it to access your original account and steal more information or even transfer funds to their own accounts. The interface of these websites is often a one to one replica of the original site, so it is often difficult to distinguish them from real websites.
How to protect yourself from a crypto hack?
Hackers often send links to phishing sites on social media, via SMS, or by email. The first way to keep your cryptocurrencies safe is by not clicking on suspicious links. This rule might sound cheesy, but scammers continue to cheat people successfully due to people not following it. For example, in mid-January, WhatsApp alerted its users about a fraudulent scheme that used the Adidas brand. They tried to obtain personal data from this messaging service’s users.
The second rule is to carefully verify what is displayed in the address bar. Even a slight difference in spelling indicates that the site is fake, and it can be crypto hack. It is also necessary to verify the functionality of the site. It is often the case that only one page of the phishing site works, which is the one where you enter your username and password. FAQ pages, for example, are usually not replicas.
The third rule to keep your cryptocurrencies safe from phishing scams is to manually enter the website addresses you want to access. If you receive a link via email or SMS, do not click on it directly, but write the address with the correct spelling yourself and then press enter.
The easiest way to keep your cryptocurrencies safe is to bookmark the sites you visit most frequently. For example, you should bookmark your cryptocurrency wallet and the exchanges in which you trade. You can also check a suspicious page through a special Google service. In any case, it is always better to be safe and simply avoid crypto hack and any site that makes you doubt its authenticity for any reason.
Fake wallets
Fake cryptocurrency storage apps often appear on the Google Play Store or other seemingly trusty websites. These programs ask you to enter your credentials to store your currency but actually send these funds to the hackers’ own wallets.
How to protect yourself from a crypto hack?
Entrust your funds only to reliable services. Before you start using any new app, research all the information you can about it: for how long has it been operating? Who are the developers? What do the user’s reviews say? Answering these questions might save you from using a fraudulent wallet and losing your funds.
Nonexistent cryptocurrencies
Last year, several pyramid schemes were discovered and closed at once; they caused damages which amounted to several million dollars. Such projects hide behind the idea of creating their own safe cryptocurrencies, when in fact, there is no such intention from the developers and owners. The organizers create a classic fraudulent scheme, after which they disappear with the money of the investors. They might also create a Ponzi scheme. Here, they use money from new investors to repay the earlier ones and even generate an illusion of profit while in reality, they have not generated any, which is a crypto hack. These early investors will probably re-invest their money and even incite others to invest. Once the founders of these schemes have a large enough pool of money or when repaying investors becomes impossible, they disappear with the funds leaving most of the people involved with a loss.
How to protect yourself from a crypto hack?
Projects that promise guaranteed returns and function as part of a network marketing system are often pyramid schemes. One huge red flag is raised when your returns depend on you convincing other people to “invest”. Before investing in any project, you should carefully study its business plan, its technical component and the team behind it. In the field of cryptocurrencies, investing in new startups is especially complex, so any such investment should be considered as risky.
SIM card swapping
One of the best security measures to protect your accounts is two-factor authentication, but hackers have already discovered how to use it for their own purposes. Often, to access exchanges or cryptocurrency wallets, you must receive a code through SMS, showing the site that the person accessing the account is in possession of the owner’s phone, but hackers have already found a way around this.
First, they discover the user’s phone number and personal data through open sources or operator employees. Then, they block the SIM card (for this, they just contact the telephone company’s support service and report the SIM card as lost, verifying the fake identity with the aforementioned data). Then, with the same data, they obtain a new SIM card linked to your phone number. Or simply get their own SIM card linked to your phone number by the operator. This allows them to receive two-factor authentication codes for your accounts on their own devices.
How to protect yourself from a crypto hack?
The only thing that can completely protect you against SIM swapping is to have a separate SIM card to use in any cryptocurrency-related accounts. This phone number should not be used in everyday life. It should not be published anywhere and no one else should be informed about it. Some phone service providers now also offer the possibility to create a password for blocking, assigning and requesting SIM cards.
A simpler and less expensive method is to use special programs for two-factor authentication instead of a telephone. This feature is now available in most safe cryptocurrency exchanges.
Account hacking
The most common, but still very important way to steal funds, is to hack an account.
How to protect yourself from a crypto hack?
In addition to common-sense rules such as the use of complex passwords and two-factor authentication (but not through the use of a telephone number), the main preventive measure is not to store money in the exchange. Regardless of any security measures implemented, criminals may be able to gain access to wallets in the trading platform. You must only keep enough funds in these accounts as necessary to conclude the specific transactions you intend to perform. After performing these transactions, you must immediately withdraw all of these funds including any profit to another safe wallet. Preferably a cold one which should be stored in a safe and secure place.
Read more about cryptocurrencies and security right here: https://en.wikipedia.org/wiki/Cryptocurrency_and_security
