Blockchain technology-based cryptocurrency is storming the financial markets with its unique model of decentralization. It is believed that cryptocurrency is highly secured as it is backed by the complex mathematical algorithm and deploys cryptographic techniques to assure that your transaction is cryptographically encoded. But as the crypto market started to grow, the number of currencies and exchanges being launched and the investors started to join the crypto movement from all across the world, methods of attacking the funds particularly cyberattacks also came into notice to the crypto community. Two striking features of decentralized and technology-driven has turned to the opportunities for cybercriminals. Calm down because you need not worry about the cybersecurity of your investments after you completely read this article related to tips to maintain cryptocurrency cybersecurity.
Brief Overview Of Cyberattacks | Cryptocurrency Cybersecurity
Cyberattacks are an attempt to expose, alter, or gain unauthorized access to steal your data, information, or money with the help of your computer network. Specifically, in crypto space, attackers can hack exchange platforms, online crypto wallets, ransom digital assets by hacking your account, and many more. According to co-founder of Chainalysis, Jonathan Levin, computer or cyber-attacks are the most common cryptocurrency cyber threats. Some of them are:
- Ransomware: When cybercriminals attack your wallet or exchange and threaten you to leak your data or ask digital currencies as ransom (through Ransomeware program). This is untraceable cyber crimes that take place on the system of the network.
- Malware: In crypto space, the attacks of malware are majorly associated with the mining machines where the cyber attackers steal the mining resources after infecting the computer. It also occurs in online crypto wallets too.
- DDoS: Distributed Denial of Service or DDoS attacks commonly shakes the crypto exchanges. It targets to disrupt the service of exchanges mostly by flooding the server with unlimited fake requests to respond.
- Pyramid scheme: Pyramid or Ponzi scheme is the result of the social engineering cyberattack when the High Yield Investment Program or HYIP is being used by perpetrators to bamboozle the innocent investors or especially newbies. Attackers lure the victims to invest in a fictitious fund in return for high profits and then take away their digital assets.
- SIM Swaps: SIM swap is one of the common attack in recent times where criminal acts as the owner of victim’s mobile phone number and asks the telecom providers to grant access to their calls and messages along with SIM card. Once the attackers get credentials, they can bypass the authentication methods and can steal your funds easily.
- Hacking of trading platform and crypto hot wallets: Attacks on crypto exchanges and hot wallets are commonly seen in crypto space.
As the crypto market is flourishing, cybercrime is turning into a real threat hampering cryptocurrency cybersecurity. Sophisticated hacking techniques are being deployed by scammers to steal the digital assets and further utilizing for illicit activities and for the purpose of laundering. But, these crimes can be avoided by taking the appropriate precautions and being extra cautious in digital space.
Maintaining Cryptocurrency Cybersecurity
As cybercrimes are increasing in the crypto ecosystem, you need to secure your funds by following some of the practices related to cryptocurrency cybersecurity.
- You must set up an all-new email account which would be connected with your crypto account. This practice could help you in not missing any warning or notification from the crypto account (sometimes warning too!) Make sure your password be as difficult as it can be like a combination of small and capital letters, numeric and special characters.
- Keep your investments in various places like on different exchanges and wallets, so that if an account is hacked, you can avoid losing all of your funds.
- Diversifying portfolio means investing in more than one type of coins (some risky ones and some traditional ones) can protect your majority of funds when coins or exchanges of particular types get hacked.
- Hot wallets or online wallets are highly prone to cyberattacks than those of cold crypto wallets. So, it is being recommended to keep almost all of your funds in cold wallets whether on a hardware device like Ledger Nano, Trezor, and many more or in paper wallets generated by wallet generator (Example BitAddress).
- Trading on decentralized exchanges like Shapeshift, Changelly, and many more are preferred more over the centralized crypto exchanges in recent years as decentralized exchanges do not actually hold the funds of investors. In this way, you own and control your own funds.
- The two-factor Authentication process is turning of no use in present days due to the increasing SIM swap frauds. But, still you should not skip the step and authenticate your account.
- You must constantly update your Intrusion Prevention System (IPS), Intrusion Detection System (IDS), and also Anti Virus System (AVS) to assure the security of your digital assets from various malware, viruses and ransomware.
Thus, security issues with cryptocurrency can be overcome by deploying some of the techniques and keeping your eyes open for the details and suspicious threats.
Blockchain and cybersecurity, walk hand in hand but every technology has loopholes that can be turned into an opportunity for attackers and scammers to dupe the investors and steal their funds. Novice in the industry might think cryptocurrency cybersecurity as a myth, but through this article, I just wish to clear that Blockchain-based digital currency is highly secured which assures the utmost transparency while maintaining the privacy. Non-involvement of intermediaries, allow you to completely own and administer your funds while transferring from the sender wallet to the receiver wallet. The benefits of cryptocurrency outweigh the risks associated with crypto space which can be easily avoided by taking some of the precautionary measures. Some of the tips which are mentioned in this article can also help in securing your funds from moderates attacks.
So, next time either you are creating your account, trading in digital currency on any crypto exchanges, or transferring your funds to or from crypto wallets, just follow some of the tips and get your funds secured!
Have a safe and secure crypto journey!!