Crypto Security: How to Protect Yourself from Hackers
Over the last decade, a large portion of the global population has shifted into the cryptocurrency space, much like the internet trend of the early twenty-first century when it was first introduced. Our connections with the blockchain and Web 3.0 industries’ products, like cryptocurrencies and non-fungible tokens, are rapidly developing.
A centralized cryptocurrency exchange, Coinbase, published a report in December of last year predicting that from the then 200 million users of cryptocurrency, there will be up to 1 billion in 5 years. This demonstrates the speed with which institutional and individual investors from all over the world are adopting cryptocurrencies.
As we should all anticipate, the number of dishonest players and malicious individuals who exist only to steal people’s money will keep growing as more people become involved in the industry. This shows that knowing how to protect oneself from hackers and those heartless malicious actors commonly referred to as “hackers” is now more important than ever.
Hackers typically employ one of two primary strategies to steal cryptocurrency: either they take it directly out of the wallet of the victim or they successfully con the user into handing over the digital currency.
It should also be noted, however, that losing crypto assets might not result from an investor’s negligence or lack of knowledge; it might occur from the shady acts of the so-called “crypto custodians,” otherwise known as centralized exchanges. The perfect example is the most recent fall of the once-dominant FTX exchange, led by former crypto billionaire Sam Bankman-Fried.
Although you may lose your life savings due to the actions of others, the good news is that you have most of the ability to secure your funds, and you can always protect your assets using the methods discussed in this article.
5 Ways to Protect Your Crypto from Hackers
Getting a Personal Crypto Wallet Is a Wise Decision
Many investors buy an enormous amount of cryptocurrencies like Bitcoin (BTC) and Ethereum (ETH) and keep them in a centralized crypto exchange. While this is not entirely a bad idea, we should always understand that these exchanges are not immune to hacks, even though they take safety precautions to prevent theft.
This is where the commonly used phrase “not your keys, not your coins” comes in. As evident in the current trends in the crypto market, where many centralized institutions are collapsing with investor monies, it now appears that the best way to protect your investment is to have a personal wallet that allows you to hold your secret phrase and access your funds at any time. This might be a cold or hot wallet.
A cold storage wallet is one that is only online when it is being used and is kept physically in a wallet as a USB stick or, sometimes, printed paper. These wallets act as a physical store for tokens or coins and cannot be hacked because they’re not connected to the internet. The Ledger Nano XS, Ngrave, and Trezor are a few good examples.
On the other hand, hot wallets are software or applications that users download to their devices in order to conduct cryptocurrency transactions while they are on the go. These are the most common types of wallets and are very safe, too. Metamask, SafePal, and Trust Wallet are a few examples.
Secure Your Wallets With 2FA Authentication
When you first purchase cryptocurrencies, it will often be through a centralized exchange account that enables you to use fiat currencies like the US dollar, Chinese RMB, Indian rupee, and other fiat currencies to purchase coins. But if a hacker gains access to this account, they can “withdraw” your cryptocurrency to an address they possess.
The first line of defense against computer hackers for these accounts is typically password protection, but adding a second layer of security strengthens protection. Many exchange sites allow you to use two-factor authentication, which increases security by requiring you to enter additional information when logging in, such as personal identification like a fingerprint or face recognition besides your password.
Avoid clicking on links and attachments.
Be cautious when opening attachments or clicking links in emails from someone you don’t know. When you receive an email, the sender should be the first thing you check to ensure that the sender is genuine and not attempting to scam you. The likelihood that the email is trustworthy increases if you know who sent it unless their email account was hacked.
Keep an eye out for anything that looks or sounds suspicious, as more sophisticated phishing emails that impersonate your friends, colleagues, and trusted companies (like your crypto exchange) have become common. They might include malware that attempts to access your cryptocurrency wallet.
Don’t Download Unofficial Crypto-Related Apps
There are fraudsters using fake crypto apps to extract money from unsuspecting crypto investors. In fact, the Apple App Store and Google Play Store both list the majority of this malicious software. However, you should always be sure to download any application you intend to use for crypto-related operations from the official websites of the developer companies.
Similar to this, you will encounter either the Hypertext Transfer Protocol (HTTP) or the Hypertext Transfer Protocol Secure (HTTPS) when you access a website URL. The latter choice is the safest because it enables secure communication between a browser and a server by adding an encryption layer.
Avoid taking part in random crypto airdrops.
Airdrops are a method by which crypto projects transfer tokens to specified investors’ wallets, typically those who have used the company’s product. In other cases, the project gives away AirDrop coins to potential supporters in an effort to promote its offering.
The way the airdropped tokens are received can also vary. Investors must decide whether to accept the tokens by claiming them in some cases, but in others, they are unable to decline the airdrop and the tokens are immediately sent to their wallets. Essentially, don’t connect your virtual currency wallet to unknown websites to claim free airdrops.
Closing Thoughts
Regular cryptocurrency users, as well as brands and businesses that conduct business with cryptocurrencies, are constantly vulnerable to cryptocurrency hacks and fraud. This is a common result of relying on centralized crypto exchanges. As such, keeping your funds on a centralized exchange these days is riskier than ever. Now, it is necessary to move heavily toward using decentralized applications, exchanges, and wallets that give users maximum control over their assets.
As one of the world’s largest decentralized crypto exchanges, MelegaSwap allows you to trade directly from your personal crypto wallets (like Metamask and Trust wallets) without subjecting yourself to the risk of losing your crypto funds.
We hope this article was helpful to you, as it covers common methods used by hackers to steal cryptocurrency, advice on keeping your digital assets safe, and a concrete example of why decentralized exchanges are critical. It’s not enough to use a particular security solution to protect your funds–it’s rather better to keep them totally in your personal care.
MelegaSwap is a leading automated market maker (AMM) decentralized exchange that provides users with a variety of options to trade and earn free tokens at extraordinarily high-interest rates. Users may also stake their tokens in liquidity pools to gain trading fees (LPs).
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