Introduction To Crypto Security: Why It Is More Important Than Ever
In the past decade, cryptocurrency has grown from a niche technology into a multi-trillion-dollar industry. Digital assets like Bitcoin, Ethereum, and Solana are now part of the mainstream financial system.
Cybercriminals will be more sophisticated by 2025. Social engineering, malware and phishing will be used to steal money.
1. Understanding Cryptocurrency Risks
It is essential to know the risks before you can protect digital assets. Phishing is one of the biggest threats. Attackers will use fake websites and send misleading messages to trick you into providing your wallet or login information.
Hacking is a serious threat. Hacking is another serious threat.
Sim swapping attacks have also been on the rise. Hackers can steal your phone number using SIM swapping attacks.
Investment schemes such as rug pulling are not uncommon. After developers launch cryptocurrency projects and collect funds, they disappear, investors are left with tokens that have no value.
2. Choosing The Right Crypto Wallet
Each wallet has its pros and cons.
MetaMask is a hot wallet which connects with the Internet. These wallets can be used for quick, daily transactions.
Cold wallets are harder to hack because they are offline. Paper wallets, which allow you to print QR codes and your private keys, also fall under this category. However, they require extra care in order to prevent physical damage.
You can also use custody wallets which are managed either by exchanges or third-parties. They are easy to use, but you must trust the service providers with your private key. Your assets will be at risk if the service provider is bankrupted or hacked.
It is recommended that most investors combine a Hot Wallet for daily transactions with a Cold Wallet for large or long term holdings.
3. Protect Your Private Keys
Your private key is the key to your crypto-security.
Store your private keys as plain text in your email, phone, or computer. These devices are susceptible to hacking or malware infection. Keep them in a hardware wallet, or in a safe-deposit box.
Scammers posing as customer service agents may ask for your private key to “fix” an issue. Recall the golden rule of encryption: Your crypto is not your keys.
4. Enabling Two-Factor Authentication (2FA)
The two-factor authentication adds an additional layer of protection to your accounts. You’ll need to enter both your password and a code sent to you by SMS. Hackers will be much less likely than ever to access your account, even if you know your password.
These apps generate codes directly on the device. These codes are more secure than texts.
Enable two-factor authentication on all your accounts, including your exchanges, wallets and email addresses. Store backup codes so you can access your phone in the event it’s lost or damaged.
5. Avoiding Phishing & Social Engineering
Phishing attacks exploit trust in people. These messages may look like an official message or email from your wallet provider or exchange provider. They may even include official branding or links.
Beware of unsolicited emails that contain links and urge you to “verify or resolve an issue”.
Scammers may try to gain your trust by introducing themselves in online forums or offering “exclusive investment opportunities”. Scammers try to gain trust before they ask for sensitive information or convince you to send money.
6. Create strong and unique passwords
A weak password will make your home vulnerable to burglars.
Use at least 12 characters in your password. Your password should include uppercase, lowercase, special symbols, and numbers.
7. Store Crypto in Different Places
Distribute your crypto assets across multiple platforms and wallets.
A small amount of money can be stored in a hot wallet to facilitate active trading. The remainder should be placed in a hardware wallet, for long-term safety.
8. Secure Your Devices
Your crypto is at risk even if you are using the best wallet. You can have the best wallet and still be at risk.
Avoid using public WiFi to access your wallet or exchange. Use a VPN if you have to use public WIFI. This will ensure maximum security.
9. Cold Storage for Maximum Protection
Cold Storage involves storing private key offline, typically with hardware wallets such as Ledger or Trezor. However, some investors use an air-sealed PC to sign transactions.
Use a paper wallet created offline, stored in a fireproof and waterproof container. Protect the wallet from damage by the environment.
10. Keep up to date with the latest security trends
Criminals are constantly changing the ways they exploit the crypto industry. Stay up to date by following reliable sources like CoinDesk and CoinTelegraph, as well as security-focused blogs. Take part in the forums for your exchange or wallet. Security updates will be shared there regularly.
Protect yourself by being aware of the latest scams.
11. Backup Your Wallet
You should write down this phrase in multiple places.
Investors engrave seed phrases on metal plates. The phrase will be protected against fire and water damage.
Final Thoughts
If you need to contact a bank in an emergency, it is not possible. Use secure wallets instead.
Cryptosecurity is not an event that happens once. Be vigilant and keep learning. Treat your digital assets like you would treat a vault of cash.
