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Cryptocurrency is a fully digital, fully decentralized way for people to own their funds. With the novelty of the emerging technology coupled with the irreversible way of transacting, it’s important to know the ways you might lose your cryptocurrency – and know how to avoid it!
There are three ways your cryptocurrency might get stolen:
- Through the internet: Cyber online threats,
- Through a physical attack on your hardware device, and
- Through social engineering with schemes and scams.
The internet: Cyber threats
Anything that is exposed to the internet is vulnerable to digital threats. That includes your cryptocurrency wallet and private keys. Having your keys online only is arguably the number one biggest risk to keeping them away from threats.
There are a few ways your keys might be vulnerable online:
- A platform or wallet account is hacked: Keeping your keys online leaves them prone to risk if the platform is attacked by a hacker. If the hacker gets access to your keys, it’s easy to plunder your crypto from there.
- A malicious link can give a hacker remote access to your hardware device to extract your private key which gives them access to your crypto.
How to avoid the threat
Using an offline or hardware wallet keeps your keys safe off the internet. If you use an offline storage device and keep your keys off the internet, you protect your crypto from the digital threats that lurk online.
A physical attack on your device
If your hardware device is stolen (physically), there are some sophisticated ways to get into the device if the right measures aren’t in place. With physical attacks through means such as power glitching, and attacking the nodes needed to get access to your private key, it is possible for an attacker to get your information through your secure hardware wallet.
How to avoid hardware threats
Make sure you use top-of-the-range hardware wallets to keep your crypto as protected as possible. Set the device up with all of the possible security measures, such as additional PIN codes and advanced passphrases that can help keep your crypto safely locked in your device even if the most sophisticated attacks are put against the hardware.
Social engineering attacks to steal your cryptocurrency
With social engineering, a scammer will try and get your trust so that you give access to them without worrying if they’ll steal your funds. This usually happens by scammers pretending to be someone or authority that they aren’t in order to gain your trust – and essentially your private keys. This is common in attacks such as phishing and pharming.
How to avoid social engineering attacks
Understanding the space as much as possible is key in keeping crypto safe and in your hands. Knowing that caution is the best strategy, learning to read the ins and outs of the technology (such as a smart contract) and fully understanding the space can help protect you and your Bitcoin.