Securing Your Cryptocurrencies: Risks & Strategies

bitcoinAlthough blockchain technology and cryptocurrencies offer a uniquely secure way to make payments and transactions, the crypto world is not without its risk factors. In fact, precisely because of the nature of blockchain and digital coins, it attracts an awful lot of attention from threat actors.

The threat level has not decreased since the COVID-19 pandemic began, rather the opposite instead. Cybercriminals are leveraging the ongoing situation to steal and then launder money via the cryptocurrency system. The FBI warns that “people of all ages” are “being victimized by criminals through cryptocurrency-related fraud schemes.”

But the recent spate of COVID-19 prompted crypto attacks is just the tip of the cyber fraud iceberg, and traders have several things they need to watch out for. Here, we go over some of the risks involved in trading digital coins and some of the strategies you need to secure your accounts and investments.

Investment scams

If you’re active in the crypto trading world, there’s no doubt that you’ve seen these scams. A cold outreach approach outlines an offer in which you (and sometimes the sender) have an opportunity to profit from the latest initial coin offering (ICO).

Often these fraudulent emails are cleverly dressed up in such a way as they appear to be from legitimate websites or cryptocurrency companies. But clicking on a link or signing in to a site from one of these emails can mean emptying your accounts.

Fraudulent Mobile Apps

According to Bitcoin News, thousands of people have downloaded fake cryptocurrency mobile apps, including the false Poloniex app. Many of these malicious apps come from the Apple and Google stores, even though we often assume any app inside the official stores is safe, the reality is that many frauds make it past the tech giants’ defenses.

Unsecured Wifi Networks

If you haven’t realized it already, you really shouldn’t conduct any trading or management of your wallets on unsecured wifi networks. Because they are somewhat akin to the wild west of the internet, unsecured networks are riddled with threats and threat actors. Connecting and trading could result in your private keys being intercepted and your account information stolen.

Securing Your Currencies

Here are a few things you should do to ensure your investments and your data are safe and sound when you trade:

  • Never trade or log in to exchanges or your wallets when you’re on public wifi. If you must do so, use a Virtual Private Network (VPN) to encrypt your data and shield your activity from prying eyes. Using a VPN any time you trade is also a good idea, even if you’re on a known, trusted network.
  • Verify the publisher of all crypto trading apps that you download. It’s always better to go to the website of the exchange and follow a link from there to its app. If you download directly from the stores, ensure the logo is identical, the branding is spot-on, and there are no tell-tale grammatical errors.
  • Always use multi-factor authentication for your accounts. If possible, use a method other than text message verification, because if your phone is stolen, it can be used to enter your accounts.
  • Be aware of any current phishing scams and exercise caution when you’re approached with cold outreach investment offers and ICOs.
  • Don’t keep all of your coins in the exchange or in a hot wallet, rather, move the bulk of your investments into a cold, secure wallet.
  • Make sure all the sites you log in to have an HTTPS in the address bar, always. You can quickly double-check this by looking for the lock icon to the right of the browser’s address bar.

Cryptocurrency trading is fun, exciting, and a viable way to make a solid buck or two. But protecting your assets is super important and taking the proper approach to cybersecurity can make your investments worthwhile.