Introduction
As per recent news came on 3 June 2023 by a blockchain analysis company Elliptic an estimated 5,500 Atomic wallets (A Crypto Wallet) have been affected by the attack, a total of over $100 million were compromised. And in Early 2022 a 5 Year old crypto Exchange Naming Crypto.com was hacked and there a total of over $15 Million were Stolen By hackers. So, it becomes too much necessary for every crypto enthusiast to protect their Wallet hacks.
Let’s understand what Cryptocurrency wallet’s are and what are the right tools, tips and tricks to protect your wallet from hacking.
Let’s understand what Crypto-Currency wallet’s are?
Basically a Cryptocurrency wallet is an Application Software which is used to store and manage Cryptocurrencies. It tends to be a safe digital wallet where cryptocurrency is stored. It consists of a cryptographic Key pair, which is to be kept safe. With this key pair, one can verify its ownership and can transfer it.
With the use of crypto currency wallet you can transact your Cryptocurrencies, such as making payments, receiving or sending cryptocurrency.
Usually a cryptocurrency wallet are in digital form, but there are different types of wallets are also available. Such as desktop wallets (which install on a computer), mobile wallets (apps that run on Smartphone’s), web wallets (online applications) and hardware wallets (physical devices like a USB drive).
Generally speaking most of the cryptocurrency wallets come with a variety of security options and are nearly impossible to hack, but still hackers we should take extra precautions to safeguard our wallets.
Factors to Consider When Choosing a Cryptocurrency Wallet
When choosing cryptocurrency wallets, you should consider the following factors:
Security: It is an important aspect. Check the wallet security and check whether it is well encrypted and keeps your private keys safe. Two factor authentications, biometric or extra security such as multi signature can also be important.
Convenience: Always choose a user friendly and convenient wallet which gives you maximum features.
Exchange facility: Some wallets provide exchange facility also which will ease you to buy or sell crypto currency within the crypto wallet. If you want this type of facility then check whether is available in the wallet which you are selecting.
Cost: The wallet should be affordable and should meet all of your needs.
Essential Tips to Secure Your Crypto Wallet and Prevent Wallet Hack
Here are some Tips that you can perform to prevent Wallet hacks:
Always Use Cold Wallet
One must understand that there are two types of cryptocurrency wallets
Hot Wallet:
Hot wallet is an online wallet which is always connected to internet. Usually it is used as Web or mobile Application. Hot wallet is simple and convenient to use, due to which it is used on large scale by merchants and money markets. It is usually used for daily or small amount of transactions. But it is less secure and has a risk of cyber attack so your funds can be compromised.
Cold Wallet:
It is an offline wallet which is not connected to the internet. It is operated electronically or by physical device, such as hardware wallet or paper wallet. Cold wallets are considered much more secure, as it is isolated from internet and it provides you facility to store your keys privately. It is best for long term investments, because it provides high level security.
It is worth noting that one should always make an copy of cold wallet to secure your funds.
Choose Strong Password
Choosing a strong password helps us to strengthen the security of your crypto wallet. You can choose strong passwords by keeping some points in mind:
Length of Password: Always use a long password; password should be at-least 12 characters long.
Guess: Don’t use your personal information’s (such as your name, fathers name, girlfriend name etc.)In password as they are easy to guess. Always use the password which is untraceable and easy for you to remember.
Using Special Characters: Always use special characters (!@#$%^&*) in your password as it makes the password more secure and prevent it from compromising.
Mixture of alphabets and Number’s: Always use combination of alphabets (A-Z. a-z) and Number’s (0-9). From this your password will become variable and the possibility of wallet hack will be reduced.
Always Use new password: Never use old password which is used earlier always use new and up to date password.
Use 2 Factor Authentication
By using two-factor Authentication in your crypto wallet increases the security level of that wallet. This means while accessing the wallet you need verify twice. Some of the important points are listed below:
Organized Authentication: For two factor authentication, use an organized authentication mechanism such as Google Authenticator or Authy. Install these applications in your Smartphone and organize them by going to wallet settings.
Use Second Factor: Second such as SMS, E-mail or physical token can also be used for authentification. By going to wallet settings you can activate them and keep them secure.
Security code Requirement: When you log in to your account you will require to fill an security code. This code will be available in hosted authentication app.
Guard Against Phishing Carefully:
To avoid phishing carefully we need to follow some points which are discussed below:
Wallet link, E-mail or Social Media post:
Be careful of links coming via messages, Email or social media posts. Never ever click on these links and don’t share your personal information on it.
Don’t Share Wallet details:
Never share your wallet details such as private keys or CD authentication cod to anyone. These information needs to be with you only, are not to be shared with anybody else.
Check Questionable E-mails and Messages:
If you receive any questionable message or email, be aware and don’t trust on it. Never click on the link provided in that and never share any of your information related to wallet.
Check Official Website:
When you are doing any activity related to your crypto wallet, always assure that you are using official and verified website only. Check the URL of the website carefully.
Create regular backups:
Making regular back-ups is a very important step for securing your crypto. With the help of this you can secure your assets. If you have old wallet access codes then you will be able to protect yourself from loss of assets.
For creating regular backups you can use these points:
Protect your Private Key and Seed key: It is your identity and is important to access your crypto wallet. Always store it at safe place such as Hardware wallets or physical wallet (Paper Wallet).
Backup of Wallet File: Always make regular backup of wallet file. Use back up option given by the wallet software and copy the wallet data at secured place. With the help of this you can rectify the problem in your wallet at prevent your Assets from loosing.
Offline Backup: If you have hardware wallet then create an offline backup for that. It helps you to protect your wallet assets. Offline backup can be in the form of physical item such as Paper Wallet.
Using Updated Antivirus And cyber security software:
Using cyber security Software is important it can take your wallet security to next level. It helps you to inspect the security and identify any objections.
Cyber security software comes with different security protections which will help you to protect your assets from loosing. It helps you to protect from internal and external attacks, phishing, malware and unwanted and offensive messages.
With the help of Cyber Security software, for protection of your wallet you can use different solutions such as wallet log-in Authentication, Monitoring blockchain network, Private key and seed key protection, back up and multi signature protection.
Be Aware of Scams
Many scams targeting Cryptocurrencies are running in the Market. Be aware of anybody who is asking for sending cryptocurrencies, or asking for private keys of your wallet.There are many techniques for scams. Some of them are listed below:
1. Phishing: In this type of scam the fraudster ask you for the details of your wallet such as private key or seed phrase. It might be through official looking websites, emails or social media accounts.
2. Wire Transfer scam: Some Fraud persons can ask you that ”for transferring Cryptocurrency you need to wire transfer” they ask you for money and do not any king of crypto to you.
3. Fake Wallet: Some Fraud peoples trap crypto users by making fake cryptocurrency wallets. They Steel your wallet details and also steel your assets.
Conclusion:
In the end, it is important to protect your cryptocurrency wallet in today’s digital aspect. Recent news of wallet hacks and significant losses have encouraged peoples to find out active methods to protect their wallets. By following these guidelines and staying vigilant, you can lower down the risk of wallet hacking and safeguard your valuable cryptocurrency assets.
Safeguarding Against Wallet Hacks : (FAQs)
1. What is a cryptocurrency wallet?
Answer:Basically a Cryptocurrency wallet is an Application Software which is used to store and manage Cryptocurrencies. It tends to be a safe digital wallet where cryptocurrency is stored. It consists of a cryptographic Key pair, which is to be kept safe. With this key pair, one can verify its ownership and can transfer it.
2.What are the different types of cryptocurrency wallets?
Answer: Usually a cryptocurrency wallet are in digital form, but there are different types of wallets are also available. Such as desktop wallets (which install on a computer), mobile wallets (apps that run on Smartphone’s), web wallets (online applications) and hardware wallets (physical devices like a USB drive).
3.What is a cold wallet, and why is it recommended for long-term investments?
Answer:It is an offline wallet which is not connected to the internet. It is operated electronically or by physical device, such as hardware wallet or paper wallet. Cold wallets are considered much more secure, as it is isolated from internet and it provides you facility to store your keys privately. It is best for long term investments, because it provides high level security.
4.Why is creating regular backups of my wallet important?
Answer:Making regular back-ups is a very important step for securing your crypto. With the help of this you can secure your assets. If you have old wallet access codes then you will be able to protect yourself from loss of assets.
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