Crypto Wallet

The world is increasingly becoming more tech-oriented, and cryptocurrency is slowly but surely becoming more popular. The attraction of blockchain technology and cryptography on which cryptocurrencies are based on, is their security. Blockchain technology, through its distributed ledger, makes it hard for anyone to hack your crypto-wallet.

That said, there are always risks to your crypto-wallet such as:

  • Crypto-phishing

Crypto-phishing scams via email and Google Ads are common in the cryptocurrency world. The scams get more elaborate every year. This year 2020, phishing scams have become worse owing to the COVID-19 pandemic. Phishing scams are social engineering schemes that prey on human emotions. They purport to originate from a trusted source and typically contain a link that compromises your crypto-wallet.

The malicious actors spoof real social media accounts or websites, change the real address, and dupe them into thinking they are communicating with the real website. An example is the recent “Giveaway scam” on Twitter. High-profile political and celebrity Twitter accounts tweeted messages claiming they were going to double any Bitcoin amount sent to their wallets, then resend it back.

  • Crypto-ransomware

Crypto-ransomware is a malware that malicious actors use to extort money from crypto-wallet holders. The hackers encrypt your crypto-wallet or devices and demand for payment in exchange for the decryption key. Unlike other forms of cyber-threats, which work covertly, crypto-ransomware openly displays messages on your screen, calling attention to itself, using shock and fear to force you to pay the ransom.

  • Cryptojacking

Crypto-hackers are very subtle in their attack. Cryptojacking refers to using someone else’s computer to mine for cryptocurrencies. The hackers send you a malicious email with a link or attachment, and that seems harmless at first glance. When you open the link, it immediately injects crypto-mining code into your device. The malicious code can also infect websites that run on JavaScript code or online ads. As soon as the code loads on your device, it self-executes and starts the mining process, and what is worse is that you might ever know it is there.

How to stay protected from crypto-risks

You can keep your crypto-wallet safe by doing several things such as:

#1. Using multisignature addresses

Multisignature addresses or multisig addresses are permissions that allow a crypto-wallet holder to transact securely and avoid fraudsters. A multisig address uses several keys to authorize digital transactions in your account. Having multisig addresses means having two or more people authorized to hold the other keys, but does not authorize them to make solo transactions without your knowledge.

#2. Install a VPN

Installing a Virtual Private Network (VPN) ensures your data is encrypted using the 256-bit standard, a type of top-quality encryption used by governments, banks, and security agents. A VPN allows you to use multiple virtual locations, which prevents hackers from deducing your real location.

You can access your crypto-wallet in peace, with the VPN assuring you anonymity by hiding your location and IP address.

#3. Subscribe to a secure email service

Subscribing to a secure email service gives malicious actors a run for their money by making it hard for them to access your emails. The services offered, among other services:

    • Security restrictions
    • End-to-end encryption
    • Strict confidentiality

#4. Use cold storage ad separate funds

Always ensure you have more than one crypto-wallet, depending on the size of your crypto-savings. The primary wallet should be for transactions and trading, and the other(s) for storing your savings. The savings wallet should be stored in a secure location or cold storage wallet to prevent fraud. The private keys backup should be stored offline and separated into two or three parts, both stored apart.

#5. Turn off the auto-updates

For any apps related to your crypto-funds, the auto-updates should be turned off. App bugs have the potential of causing you huge losses. Wait two or three days after an app update to ensure it has no bugs. Once other users have tested the app, you can now install it.

#6. Practice “cold staking”

If your cryptocurrency supports staking or earning passive income, consider using a “cold staking” method. Cold staking involves delegating your staking rights to a separate wallet or address that is not connected to the internet. By keeping your staking keys offline, you reduce the risk of your funds being compromised while still earning rewards.

#7. Be cautious of phishing attempts

Beware of phishing attempts aimed at tricking you into revealing your wallet credentials. Avoid clicking on suspicious links or downloading attachments from unknown sources. Always double-check the website URL before entering your login information.

#8. Be cautious with online activity

Be mindful of your online activities related to your crypto wallet. Avoid accessing your wallet or performing transactions on public or unsecured networks, as they may be compromised. Use a virtual private network (VPN) when accessing your wallet remotely to encrypt your connection.

#9. Consider multi-signature wallets

Multi-signature (multi-sig) wallets require multiple private keys to authorize transactions, adding an extra layer of security. With multi-sig wallets, you can distribute the signing authority among different devices or individuals, reducing the risk of a single point of failure.

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Cryptocurrency is touted to be almost 100% foolproof. Cybercriminals act on the almost and take advantage of savers who are overly trusting. The trick here is to take Albert Einstein’s advice, “Never stop questioning.” Take everything with a pinch of salt, especially where money and data is concerned.

Question every website, every link, and every email you receive, and always double-check everything. Using the above precautions will heighten your chances of keeping your funds safe and criminals at bay.