Author: Aniedi Utah
Security as a concept is something that everyone embraces. From our businesses, homes and even our social web-based environments, people want to feel safe. The same goes for our assets (be they physical or virtual) as we want them to be safe from infringement by others. This basic human need is not lost in the blockchain ecosystem. Through the years, great amounts of acquired currency have been lost to hackers, it is paramount that users safeguard their digital assets. For context, Immunefi - a blockchain analytics and security firm - often dedicates its research towards tracking crypto thefts and hacks. In its recent report, Immunefi notes that $360 million from two major exploits by bad actors were recorded in the second quarter (Q2) of 2024. This figure accounted for 62% of the total losses of $920 million identified from year-to-date (YTD). With so much at stake, it is only imperative that you as a Web3 user or investor know how to safeguard your digital funds from individuals with questionable intent. In this article, we dive into the rabbit hole of crypto security and useful tips on how you can keep your funds safe.
Crypto Security - Useful or Not
Crypto Security 101: How to Ensure Hackers Don’t Wreak Havoc on your Crypto Bag. The crypto space can be described as an open arena where many people come to play. This denotes that not everyone who is out there is looking to enrich you. Many people have lost their hard-earned money either to crypto rug pulls or hacks. Crypto hacks have been done on top Web2/3 brands and exchanges like BitGo, Binance, and several others despite these companies investing heavily in security and KYC processes.
This means, you as a sole investor or user, need to be extra careful to ensure hackers don’t move your funds from your crypto wallet.
The burning question on the back of your mind might be, is crypto security useful or not? Are we barking up the wrong tree or should we just sideline the entire concept itself? If we refuse to address this issue, there might come a time when many will see their entire net worth wiped off with the strike of a button. So, what are some of the best practices and tips you can deploy towards ensuring that crypto hackers don’t have the best of you?
Use a Secure Hardware Wallet
If you’ve been around in the crypto space for some time, you might understand the connotative meaning of ‘not your keys, not your coins.’ For those unfamiliar with this, it simply means if the private keys of your digital assets are not in your care, then anything can happen to them. Given this, my first tip is to use a secure hardware wallet. For crypto newbies, hardware wallets are physical devices that store your crypto wallet's private key in an offline antechamber. It is easily the safest means of securing your cryptocurrencies as the hard wallet is not always connected to the internet as its hot wallet counterpart, thereby reducing the risks of a hack.
Now, you have many to choose from when it comes to hardware wallets. There is Ledger, Trezor, SafePal and several others.
My two-cent tip is to choose the one that works for you based on supported assets, budget, ease of use and other personal choices.
Use Strong Passwords
This tip cannot be overemphasized. Hackers prey on crypto accounts or wallets with weak passwords. Using your birthday, anniversary, or other personal details to secure your crypto account is a sure means of getting your funds stolen. The best practice is to create unique, complex passwords for each of your different crypto accounts. No two platforms should be secured with the same password. An idea is to use a mix of uppercase, lowercase, numbers, and special characters, making it difficult for hackers to have their way.
Enable 2FA
2FA (two-factor authentication) should be a principal part of your security arsenal. Ensure that 2FA is always turned on for all your crypto accounts, making sure that every transaction requires a special code before it is executed. This way, if someone has access to any of your crypto accounts, they cannot withdraw your funds without the generated code sent to either your phone or a linked authentication app.
Beware of Phishing Scams
This is an oldie but ever-relevant in the crypto space. Be careful of suspicious-looking emails, messages, or websites, asking you to insert your private or recovery phrase or other sensitive information. Always double-check each website’s URL address to ensure you’re visiting the correct website. Hackers now clone websites so stay on your toes. Never give your private key to anyone!
Backup Your Wallet
May sound complex but this means storing or keeping your wallet’s private keys in an offline or safe place. A rule of thumb is to write it down and keep it in a safe and dry area. Don’t store them on your computer or cloud storage. Losing access to your private keys means you lose complete control of your crypto accounts.
Use Multiple Platforms
Don’t keep all your crypto assets on one platform or device. Make sure you diversify your digital assets across different wallets or crypto platforms. This makes it safer for you so you don’t lose all your assets if eventually one platform is compromised.
Test Small Transactions First
Finally, when making crypto transactions the best thing is to first send a small amount of crypto to validate it is forwarded to the right recipient. This reduces the chances of sending large sums to the wrong wallet address or network. Errors in the crypto space are punished severely as sending funds to the wrong blockchain network cannot be retrieved.
Final Thoughts
Hackers are becoming more and more sophisticated every day. They rely on high-end tech that is easily not in the grasp of the public. Given the crypto space is still relatively novel to many, it is an ideal playground for malicious actors. The tips covered in this article will put you in a better position to secure your future wealth without losing sleep.
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