In this how-to protect your crypto funds checklist, we offer a comprehensive guide to the most useful and effective means of protecting your crypto funds. Cryptocurrencies present numerous advantages for individuals, investors, and business owners, and finding ways to safeguard your cryptocurrencies is critical.
10 Best How to Protect Your Crypto Funds Checklist (2022)
But as with every new territory, there are inherent risks to those who don’t understand the terrain. Using the checklist in this article will safeguard you against bad actors and help you to remain vigilant of any scams or threats to your crypto funds.
Understanding cyber security risks associated with crypto funds
It is estimated that 33% of Bitcoin trading platforms have been breached despite the fact that blockchain technology is extremely secure in theory.
Since the blockchain relies on cryptographic keys and transactions, it has a security issue. Using a key, you may decipher your Bitcoin’s private key, which is a combination of letters and numbers.
It’s safe and secure, but the safety of the platform where you store it, such as a Bitcoin wallet, becomes critical because your funds can be stolen if a hacker accesses your key.
Cryptocurrency businesses face the same kinds of cyber dangers as any other. You need to be extremely careful with your accounts on these platforms.
When someone gains complete control of your account, they can steal your private key and use it to access your funds.
Added to this, because certain Bitcoin and crypto activities cannot be tracked, it is a prime target for scammers and hackers. Large hacker gangs are constantly at work, attempting to take down both individual accounts and entire crypto sites.
Added to this, as with any business environment, there is always the risk of scammers, especially with regard to nefarious cryptocurrency platforms.
Case in point: One Coin’s entire currency system was a fraud. Multi-level marketing scams are notorious for luring unsuspecting victims with the promise of large payouts, only to rip them off by taking their money instead. This shows that hacking is not the only security concern to consider.
With this in mind, let’s take a closer look at some of the most effective steps which you can take to protect your cryptocurrency funds from hackers and scammers alike.
Don’t share your private key
Every time a new user makes a transaction with Bitcoin or an alternative cryptocurrency, a unique set of public and private keys is generated for that user. Alphanumeric characters make up each of the keys, which help to protect a user’s digital assets in the ecosystem.
The user’s private key acts as the user’s digital identity. As long as the user has their private key, he or she has full control over their account. Both the private key and the public key are saved in a digital wallet using a complex algorithm.
Whenever a user wishes to give another person digital currency, the transaction must be broadcast to the network so that nodes across the network may verify its legitimacy and record it on the blockchain.
The private key is used to digitally sign the transaction before it is broadcast. Signatures provide proof of ownership of the private key even when the private key’s details are not made public.
To demonstrate that the digital signature was generated using the user’s private key, the public key of the user is used. Funds will be sent to the recipient’s public address once the transaction has been verified as legitimate.
You must keep your private keys in a secure location. It’s true that you can’t just reset your keys the way you can reset your password.
Some people choose to commit their private keys to memory, but it’s a good idea to have a backup copy somewhere safe just in case something happens to them.
Additionally, don’t be tempted to share the location of the physical copy of your private key with someone else, even if you fear that your tokens are not locked away indefinitely in the event that something happens to you.
Although you can save your private keys digitally using a service such as a password manager, it is recommended that you preserve a physical copy for your own protection. Conserve it in a secure location in your home, such as a fireplace, or even better, in a bank’s safe deposit box.
Secure your seed phrases
A seed phrase, also known as a seed recovery phrase or a backup seed phrase, is a set of words that contains all of the information necessary to recover Bitcoins from the blockchain.
When using wallet software, the user is often instructed to write down a seed phrase that has been generated by the wallet software.
If a user’s computer crashes or their hard drive becomes corrupted, they can reinstall the wallet program and restore their Bitcoins from the paper backup.
Anyone else who discovers the phrase has the potential to steal your cryptocurrency funds, thus they must be protected in the same way that jewels or cash are.
Due to the fact that seed phrases are a wonderful method of backing up and preserving cryptocurrency, practically all well-regarded wallets make use of them.
4 ways to securely store your seed phrases
Using a metal backup
Seed phrases can be stamped or carved into the metal, which is far more durable than paper. A metal backup system is indicated if the threat model includes fire or water as well as extremes of temperature or physical stress.
Steel plates and capsules make it simple and secure to physically store your seed phrase, or divide seed phrases, in a safe and convenient manner. In addition to the Cryptosteel capsule and the Blindfodl steel plate offered by Ledger, there are various other variants of similar items available.
Hiding them in pencil or paper back-ups
After much trial and error, it has been discovered that pencil and paper are one of the most effective storage mediums available.
In order to prevent theft, the private keys of your crypto wallet can be encoded into random phrases taken from a dictionary and written down. If your hard disk fails, you can recover the seed phrase from a piece of paper and use it to restore the complete wallet.
Because seed phrases are composed of natural language terms, they have a high degree of error correction. Words written in sloppy handwriting are frequently still readable.
Even if one or two letters are missing, it is generally possible to discern the meaning of the word. The word list from which the seed phrase words are derived is carefully crafted so that the first four letters of each word are sufficient to distinguish it from the others in the list.
Writing with a pencil is far superior to writing with a pen for keeping information on paper. Added to this, the paper you use should be acid-free or of archival quality, and it should be stored in a cool, dry place away from extremes of heat and moisture.
Splitting your seed phrase
A seed phrase is typically comprised of between 12 and 24 words chosen at random. Despite the fact that this is virtually impossible for someone to predict, once they discover your seed phrase, they will have immediate access to your cryptocurrency funds.
In contrast, fraudsters will not be able to access these funds if they do not have the entire seed phrase in their possession. It is for this reason that seed splitting is a fantastic concept.
Seed splitting is the process of dividing your seed phrase into two or more portions and storing each section separately in a secure location. This is something that can be done both digitally and physically.
Physical storage is generally considered to be safer because it eliminates the potential of cybercrime or system failure (both of which can result in the ultimate loss of your crypto funds).
Storing your seed phrase in a hard drive
Hard drives, such as a USB stick, allow you to save your seed phrase offline. This is a tremendous benefit. Also, they’re a lot more convenient and economical than some alternative storage options.
Unlike engraved plates or capsules, hard drives can be found in nearly every tech store, but there is a clear downside: they are not designed to be safe.
So, if you keep your hard drive in top condition, you should be fine. However, criminals might simply access your seed phrase by plugging the device into any laptop or computer.
It’s possible to make it more difficult to access your seed phrase by distributing it across multiple disks, but these drives will always be straightforward to penetrate once discovered.
Invest in a hard wallet
The blockchain ecosystem relies heavily on hardware wallets. With blockchains, they give security and utility.
Access to your crypto assets from anywhere is now possible with a simple plug-in device known as a hardware wallet. Using a hardware wallet, you don’t have to set up fresh accounts for multiple dApps. Regular programs like Google and Facebook can be accessed with them as well.
A hardware wallet can simultaneously operate on many blockchains. On the same device, you may handle Ethereum and other altcoins, as well as Bitcoin, Litecoin, and Lumens. A single recovery word can be used to back all of them up.
How hardware wallets work
Hardware wallets don’t actually hold any cryptocurrency; they’re all stored on the blockchain. Only your private key is stored in the hardware wallet. This private key is the key that unlocks your blockchain address, which is where all of your assets are stored.
To interact with your tokens, all you need is your hardware wallet, which is already connected to the blockchain.
Because hardware wallets keep your private keys offline, they are sometimes referred to as “cold storage,” which reduces the chance of an internet attack compromising your funds.
Both your hardware wallet’s PIN and an optional passphrase secure the data you keep there. It’s quite tough for a burglar to get your keys out of your hardware wallet if they steal it. It is impossible to steal the keys because they are never made available online. Hence the term “cold storage.”
Added to this, there is only one seed phrase that can be used in the event that your hardware wallet is lost or stolen.
If using a ledger, insert the 25th word
One of the most popular options for cold storage using a hard wallet is the Nano Ledger. Using USB sticks, Ledger’s hardware wallets hold private keys, making it harder for hackers to gain access to the key from an online location.
It is possible to transmit and receive cryptocurrency from blockchains using these wallets, and it is also possible to run third-party apps on the device. The wallets, for example, may be used to perform two-factor authentication on popular websites like Dropbox and Google.
In order to safeguard a user’s digital currency assets, all Ledger products feature a Secure Element and a custom operating system.
In the event that the device containing the private key is lost or stolen, the user’s cryptocurrency can be accessed using a 24-word backup recovery phrase. To increase the security of this feature, you can now add a 25th word to the recovery phase using the passphrase.
The passphrase is a more advanced function that lets you extend your recovery phrase by one more word. As a result, it’s also known as the 25th word.
Instead of the usual recovery sentence, you’d select the word 25. There are no constraints on the word you can use. The only restriction is that you can only use 100 characters in your selected phrase. The passphrase is likewise sensitive to caps and can be made up of digits and signs.
When you add a passphrase to your account, you’ll be able to access a completely new set of accounts. You can think of it as two completely separate recovery sentences.
Benefits of using a passphrase
First of all, adopting a passphrase means that even if someone had your 24-word recovery phrase, they wouldn’t be able to access your valuable cryptocurrency. To gain access to your crypto assets, you’ll need your 24 secret words and a 25th word you made up on the spot.
Only your regular accounts would be accessible if they had only 24 words. This is why password-protected accounts are referred to as “hidden accounts.” It not only adds another layer, but it also spreads out your backup’s unpredictability even further.
You’d be able to make use of an even greater variety of possible word combinations if you added a 25th word to the mix. Instead of receiving a list of 24 words from a gadget, you’d be adding a random term that you’ve thought of and made yourself.
Use 2FA to secure your crypto accounts
One of the best ways to secure your crypto account is to utilize two-factor authentication. Due to the lack of fraud protection and recovery procedures in cryptography, hackers are more likely to steal money from your wallets than they are from a bank.
Two-factor authentication is a necessity because it is your responsibility to protect your account. There is a learning curve involved in understanding and setting up two-factor authentication, but the added protection is definitely worth it.
One of the best means of setting up 2FA is through Google’s Authenticator app.
How to set up 2FA using the Google Authenticator app
By choosing “Get Started” on the main 2FA landing page, you can easily enable two-factor authentication.
Be sure to log in and pick your mobile device from the drop-down menu before continuing. Depending on your device, you may need to download the app first
After that, you’ll be given the option of receiving verification codes through text message or phone call, depending on whether Google is able to deliver a message to that phone. Your chosen method will be tested by Google once more.
When a login attempt is made, Google will initially send notifications to your phone, allowing you to easily pick “Yes” or “No.” Otherwise, it will make an attempt to contact you via text message or phone call.
Backup codes can be generated for offline use. Because Google only generates ten codes at a time and they’re meant to be used one time, if you’ve printed them out, cross off the ones you’ve already used.
Transact on an OS with additional security
While most users run Windows, Mac, or Chrome OS as their operating systems, these are not fully secure against cyber-attacks.
Therefore, it is highly recommended to install a secure OS, which you can even run separately from your main device for the purpose of running your cryptocurrency transactions. One great secure option is Tails OS.
Tails is a Linux distribution built on the Debian operating system with an emphasis on privacy and anonymity. It uses the Tor anonymity network to access the Internet.
Booted as a live DVD or live USB, the system leaves no digital footprint on the machine unless explicitly instructed to do so by the user.
Using Tails, you can also use proprietary software for reading and editing documents, image editing, video watching, and printing. At the user’s request, more Debian software can be installed.
More importantly, though, security-related software is included in Tails, which includes encryption, cryptographic signing and hashing, and a range of other vital features. With many connection possibilities, Tor is pre-configured.
All connections are made through Tor and attempt to connect outside of Tor are blocked.
uBlock Origin is included in a modified version of the Tor Browser, which is used for networking functions such as instant messaging, email, and file transfer, as well as security monitoring of local network connections.
Invest in a VPN
A VPN, or virtual private network, protects your online privacy and anonymity by turning a public internet connection into a secure private network. Your online activities are essentially untraceable due to the VPN’s ability to hide your IP address.
Secure and encrypted connections are the most significant feature of a VPN service, as they ensure better anonymity than even a secured Wi-Fi hotspot can provide.
How VPNs safeguard your crypto funds
Hackers won’t be able to track your online activities because a VPN encrypts all of your data. As a result, your physical location is not associated with your blockchain wallet address because your IP address is hidden.
A virtual private network (VPN) protects your online activity by encrypting your data and traffic. Encryption with 256-bit AES can withstand brute force assaults. In the event that someone gets their hands on your personal data, they will be unable to decode it.
Added to this, VPNs are an additional line of defense against threats such as viruses, malware, and phishing.
When you use a virtual private network, your true IP address is disguised so that no one can follow your online activity. When you connect to a server in another country, your IP address changes. Buying and selling cryptocurrencies online can be done anonymously in this manner.
Install a firewall
Incoming and outgoing traffic is monitored by a firewall, which determines whether or not data packets are allowed or blocked according to predetermined security criteria.
Its primary function is to protect your internal network from outside threats, such as viruses and hackers, by establishing a firewall between it and the internet.
Incoming traffic is carefully analyzed by firewalls based on pre-established rules and suspect or insecure traffic is filtered out. Ports on a computer are the entrance points via which data is transferred with external devices, and these ports are where firewalls monitor traffic.
A software-based firewall is preferable to a hardware-based one, however, they can both be used. While a software firewall is installed on each computer, a physical firewall is a piece of hardware that is positioned between your network and gateway to manage traffic.
Employ secure smart contract behaviors
A smart contract is a program stored on a blockchain that executes when a set of pre-set criteria are satisfied.
It is common to automate the execution of an agreement so that all parties may be sure of the outcome instantly, without the involvement of an intermediary or the loss of precious time. If a condition is met, the following step can be initiated by using workflow automation.
When a set of specified circumstances is met and verified, a network of computers takes action. Actions that could be taken include releasing monies to the rightful owners of the vehicle, issuing a ticket, or sending out notices to the public.
Afterward, the transaction is recorded on the blockchain. That means that the transaction cannot be reversed, and only parties who have been allowed access to the results can see them.
A smart contract can include as many restrictions as necessary to ensure that the task is accomplished to the satisfaction of all parties.
All parties involved must agree on how transactions and data will be represented on the blockchain, establish any rules that govern them, look into any possible exceptions and specify a process for resolving disputes before they can begin setting the parameters of the agreement in place.
While the smart contract protocol seems pretty secure, it has been breached before, so there are a number of behaviors that you can employ to improve the security of your smart contract spending.
Avoid some of the add-ons
When working with protocols that support multifunctional smart contracts, you must adhere to the standards set out by the underlying blockchains. If you don’t, you risk introducing fatal flaws into your code.
Smart contracts can be further restricted on some networks to aid developers in enhancing the security of their code. And while these constraints may limit contract functionality, the added control improves contract security.
Make use of security audits
Security audits are an important part of ensuring that your smart contracts are safe. To begin with, experienced auditors are able to identify any flaws in your code, as well as provide you with helpful advice on how to correct and optimize your software.
Secondly, having a few others from outside your project have a look at the code provides you with a new perspective on the problem at hand. Consider hiring a third-party penetration testing company and offering a bug bounty to speed things up a bit.
Respect the programming language
In order to limit the number of flaws and errors in code, many blockchains have developed their own programming languages. While working with well-known programming languages, even seasoned developers aren’t exempt from committing errors.
There are just too many variables to consider, including issues with the language, the compiler, and the blockchain.
Therefore, the most important thing is to adhere to the best standards set forth by language and blockchain developers alike.
Learn how to spot fake crypto exchanges
Digital assets can be bought and sold on cryptocurrency exchanges. Because these exchanges are unregulated, scams can occur.
Fake cryptocurrency exchanges as well as manipulated trade volumes on supposedly legitimate exchanges have been used by scammers in order to entice new investors and steal their money.
In some cases, these exchanges may harass users or block crypto withdrawals or charge exorbitant fees, or even walk away with your whole investment. Use only reliable exchanges to protect yourself from scams.
Before signing up for an account, you should be able to identify the indicators of a fraudulent website.
Exchanges with unusually high fees
Platforms or exchanges that have unusually high withdrawal fees and other non-trading fees could be a scam site.
Because the exchange is in essence not real, these scammers make money through high fees on transactions that aren’t even occurring.
Sites that offer impossible investment returns
These frauds are more difficult to detect, but the scammer still gets off with the victim’s stolen crypto.
Multi-level marketing and high-yield investment programs are the foundations of this time-tested concept.
Using referral links, a little initial investment can be multiplied in these ethically questionable scams. Hundreds of people quickly became part in the scam. The pyramid crumbles when the initial scammer eventually departs with all the participants’ crypto funds.
A limited online presence
There are several trustworthy crypto organizations and experts out there, and you should always utilize a site supported by one of them. The people or organization that supports the crypto site should also be researched.
You can figure out if a cryptocurrency site is a scam by reading news from reputable sources, such as the Wall Street Journal. The site name can be entered into Google to see if there are any reports of scams or information about the site.
After verifying the site’s credibility and reviews, check the application’s reputation from several sources. To help you decide which crypto website to utilize, read articles, watch videos, and listen to conversations with a variety of crypto professionals.
Don’t place your funds on central exchanges
An online platform that facilitates the purchase and sale of cryptocurrencies is known as a “centralized cryptocurrency exchange.” It’s the most frequent method used by investors to buy and sell crypto assets.
When we talk about a “centralized cryptocurrency exchange,” we’re referring to a system in which transactions are facilitated by a middleman or third party.
This middleman is trusted by both buyers and sellers. When a customer puts their faith in a bank to keep their money safe, this is a typical setup with regards to an exchange.
As such, traders have confidence in the exchange because they know that it will use the network of other users to discover trading partners, as well as complete their transactions in a secure manner.
Cryptocurrencies are commonly stored in digital wallets, which means that losing the wallet’s key might cost individuals hundreds or thousands of dollars in digital money. Exchanges protect investors’ assets in place of individual investors so that in theory this risk is mitigated.
However – cryptocurrency exchanges are highly susceptible to hacks.
The last five years have shown that hackers may steal millions of dollars without compromising your cold wallet if they can compromise your exchange. Hackers are interested in any online activity or application layer that is accessible over the internet.
Crypto-security is heavily influenced by the exchange’s physical location and jurisdiction. As of right now, there are no universally applicable exchange regulations, and investors have even fewer safeguards.
You may not be able to accurately estimate your risk because the servers’ true geo-location may not be as displayed, owing to caching servers and redirection.
Added to this, taxes, consumer rights, and banking rules are only some of the non-cyber crime issues that might be affected by location. Everything from the amount of time it takes to withdraw money to the structure of the exchange differs depending on where you go.
So in essence, location is a technical issue, not just a matter of infrastructure. If you’re using a well-known service like Amazon Web Services, Google Cloud, or Microsoft Azure, you’re leveraging high-quality technology.
You may not be able to access your money if you use a cloud service that is less well-established.
Don’t buy into tempting scams, even if they appear on official platforms
Many trusted sites and platforms have already fallen prey to well-disguised scams. In late 2021, more than 300 community members on Fractal were scammed by a fake link posted in the site’s announcements channel.
Over $150 000 was stolen by the hacker in this instance, while more crypto enthusiasts were scammed by a fake giveaway posted on Bitcoin supporter Elon Musk’s Twitter feed.
The best means of avoiding such well-disguised scams is to avoid jumping on amazing offers as soon as they appear. Wait it out, and see whether the amazing offer is in fact a reputable source.
As the old adage goes – if it seems too good to be true, it usually is.
Don’t fall prey to email phishing hacks
The first reported phishing fraud is thought to have taken place in the mid-’90s, long before the rise of cryptocurrency.
Phishing’s primary objective is to rob unsuspecting victims of their money, but because tech-savvy hackers are using it, it is increasingly being used to steal digital assets as well. Cryptocurrencies offer better privacy safeguards, making it easier for criminals to get away with theft.
There are a few general guidelines to follow if you want to stay safe from phishing scams. For example, it’s a good idea to save your passwords and other critical information to trusted sites.
Contact email addresses from cryptocurrency companies you interact with are also good to keep on hand. Additionally, phishing emails and malicious websites that incorporate a minor typo of an actual address have been used by many people.
There’s nothing wrong with double-checking URLs; it’s an excellent habit to form. Protecting your crypto assets begins with an understanding of how phishing schemes work, and one of the most popular email phishing scams is known as spear phishing.
Spear phishing attempts, in which hackers target specific individuals with personalized content — generally a fake email pretending to be from a trusted sender — are on the rise.
It’s not uncommon for attackers to try and persuade victims to divulge personal information or to visit a malware-infested website. According to recent reports, approximately 700 social engineering assaults are launched annually against the average firm.
Emails and SMS messages pretending to be from cryptocurrency trading sites like Bitfinex seek to convince the recipient that they should “update” or “alter” their seed phrase in order to steal their passwords and drain their wallets.
To avoid such hacks, verify senders and URLs thoroughly, stay away from open Wi-Fi, and use 2-Factor Authentication to protect yourself against online scams. Always exercise extreme caution when responding to an email that requests that you provide your username and password.
Transact in small amounts at first
In order to verify that the recipient of your transfer is legitimate, send across a small amount at first as a precautionary measure.
These test transactions will ensure that your crypto is being sent to the right address, and not to a scam location or one delivered by hackers.
This is important because viruses have been known to infiltrate users’ Clipboards with their own addresses. Many individuals simply check the last four digits of an address without verifying the entire sequence – resulting in severe losses to crypto hackers
Beware of Dust Attacks
In a dusting attack, a small amount of crypto, known as dust, is delivered to a large number of wallet addresses, possibly hundreds of thousands at a time. The goal of this attack is to “unmask” or “de-anonymize” these addresses by tracking them.
“Dust” is also the term used to describe little sums of coins that remain on a user’s account after a trade has been completed. Dust balances cannot be traded, but they can be exchanged for digital cash by users.
Because each software implementation (or client) may assume a different threshold, there is no formal definition for dust in Bitcoin. Dust is defined by the Bitcoin Core as any transaction output that is less than the transaction fees.
Dusting assaults have been used by criminals to reveal the identities of people with substantial Bitcoin holdings. There are many ways cybercriminals might attack those with big assets, including phishing scams and cyber-extortion.
A hierarchical-deterministic wallet, which generates a new address for each transaction, makes it more difficult to track you. The “do not spend” option is also available in some wallets, which reveal dust UTXOs (unspent transaction outputs).
No one can trace where these modest sums go if you keep them in your wallet and never use them. You can also mask yourself from dust attacks by using a VPN or the Tor Network, as described earlier.
Revoke contracts as soon as a protocol is exploited
You should revoke token approvals when your platform’s protocol has been hacked so that apps you no longer trust can’t commence tasks or transact tokens on your behalf.
Allowing apps to access and move tokens in your wallet on your behalf is what smart contract allowances, also known as approvals, are all about.
Signing an agreement with a DEX (decentralized exchange), for example, means that its smart contract can take tokens from your wallet to fulfill your deals.
Because of this, both hackers and scammers use token approvals as a frequent attack vector. Hackers can do this by looking for and exploiting flaws in the code of a smart contract, while scammers use rug pulls.
As a result, token approvals frequently demand that token holders have full access to their tokens. In theory, a hacker or a fraudulent smart contract owner may use this to drain your wallet of the tokens you’ve given them access to.
At the first sign of malpractice occurring, immediately revoke your contract. This can be done easily by using apps from Zapper, Rabby, or Etherscan.
Don’t connect your wallet to websites
It is up to you as the user to approve any requests made by a chosen website in order to have access to your wallet’s public address and do any requested activities.
Theoretically, if your wallet is automatically connected to a site whenever needed, things would run more smoothly and be more user-friendly.
However, the connection isn’t automatic for security reasons: by auto-connecting (or even alerting the site that you have a wallet) you’d offer the website too much personal information.
Websites that are harmful may try to find out whether a user has a crypto-wallet, and if they do, they may begin a variety of crypto frauds and phishing assaults.
It’s safe to link your wallet locally if you’re running programs you know and trust. Connecting your wallet to any website isn’t very dangerous, but you should avoid doing so unless absolutely necessary.
Added to this, once you’ve completed your transaction, disconnect your wallet immediately, rather than leaving it open to nefarious attacks on the website itself.
Beware of fake YouTube live streams – or any live streams which may have been hacked
There has been an ongoing phishing campaign against YouTube creators, according to Google’s Threat Analysis Group (TAG), which usually results in the breach and sale of channels for the broadcast of crypto-fraud.
Hackers hired from a Russian-language forum hacked a creator’s channel by promising phony partnership options, according to TAG. It is common practice to either sell or broadcast cryptocurrency frauds on YouTube channels that have been taken over by a hacker group.
It’s been revealed that cookie theft malware is being used to steal YouTube accounts, which is a false program designed to operate undetected on the victim’s computer. Moreover, according to TAG, hackers access YouTube channels to imitate well-known tech companies or Bitcoin exchanges.
In this regard, if something looks off, don’t jump at the offer – and be wary of any giveaways in general.
Beware of impersonation scams from customer support
Hackers put up fake customer assistance lines and impersonate a wide range of businesses in the financial, retail, telecom, and service sectors. These hoax phone numbers are widely disseminated on the internet, tempting helpless victims.
Outbound calls may also be made directly to potential victims by scammers. Social engineering is a strong suit of these con artists, as they utilize bogus promises to trick their victims into supplying personal information that would be misused.
To avoid falling prey to such impersonation scams, adhere to the following:
- Never grant remote access to your computer to anyone, not even your support staff. Your computer and online financial accounts are effectively in the hands of the scammer.
- Security codes and passwords for 2-factor authentication should never be divulged. Authentication credentials will never be requested from legitimate customer support staff.
- Don’t give out your personal information over the phone. If you receive a call from a phone number that doesn’t sound right, rather end the call.
- Never transfer cryptocurrency to a supposed support agent’s external address.
Change your password regularly
Every coin on the blockchain’s ledger has a complete record of its history. There is no ‘reset password’ option because the blockchain is decentralized and the login details are not maintained on a central database, which means the credentials belong to the individual users.
As such, while it is not really necessary to change your wallet passwords, but rather to keep them safe – as we discussed earlier in this article – it is nonetheless vitally important to regularly change the passwords on your actual devices.
Hackers that are able to infiltrate your laptop, for example, could easily ferret out important information needed to hack your crypto funds.
The same password is used on an average of 10 devices, applications, and social media accounts by three-quarters of millennials today. Added to this, the majority of these use the same password across more than 50 different sites.
It is vital that the password you create is fool-proof and difficult to decipher or figure out. You should also change your password frequently. If you’re using more than one wallet, be sure each one has its own unique password.
Cryptocurrency is considered by many to be the next frontier in online investment and daily financial transactions, with numerous traders, business owners, and individuals making use of these revolutionary digital coins to transact in completely new ways.
As a fully digital currency, they allow for a fast means of online transaction, while their decentralized nature means that they are not tied to the regulatory red-tape of financial institutions.
Added to this, the value of various cryptocurrencies like Bitcoin, Ethereum, and Dash has been increasing exponentially along with their evolving use and the evolution of the various blockchain platforms on which they are facilitated.
However, because digital currencies exist on the internet, they have greater exposure to the risks of cyber-attacks. In fact, up to $14 billion in crypto funds was stolen by hackers in 2021 alone.
Therefore, and luckily there are several effective measures that can be taken in order to prevent unnecessary losses through cyber-theft.