Cryptocurrency, popularized and made famous by Bitcoin, is a type of digital currency that has gained popularity as an alternative to conventional currency as well as typical investment asset classes. However, with the increase in popularity of cryptocurrency, this has given rise to bad actors who want to gain access to other people’s digital assets through illegal means.
Hackers can do this by exploiting vulnerabilities in digital wallets, also known as cryptocurrency wallets, which are typically used to store cryptocurrency coins. In this article, you’ll learn more about how hackers get into crypto wallets, and what you can do to stop them in their tracks.
How Do Hackers Get into Crypto Wallets?
Cryptocurrency wallets are a hot target for hackers because they can potentially gain access to a large amount of digital assets. There are a few different ways that hackers can get into crypto wallets:
- Phishing attacks: Hackers will send fake emails or create fake websites that look like the real thing in order to try and trick users into entering their login credentials.
- Malware: Hackers can create malware that will infect a computer and allow them to gain access to the user’s cryptocurrency wallet.
- Social engineering: This is where hackers will try to trick people into giving them information or access to their account by pretending to be someone else.
- Exploits: Hackers can exploit vulnerabilities in software in order to gain access to people’s wallets.
- Hardware attacks: In some cases, hackers can physically tamper with devices in order to gain access to the data stored on them.
Because of the dangers that hackers pose to cryptocurrency holders, it’s important to know how to safeguard your assets accordingly. Below is a short list of invaluable tips that you can apply to keep your investment safe from these types of attacks:
1. Prevent Phishing
When it comes to digital security, phishing attacks are among the most common and dangerous threats out there. Phishing is a type of cyber attack that involves criminals sending fraudulent emails or messages in an attempt to trick victims into revealing sensitive information, such as passwords or credit card numbers.
In the context of cryptocurrency, a phishing attack could involve an attacker trying to trick you into revealing the private key for your wallet. If successful, the attacker would then have access to your cryptocurrency assets.
Fortunately, there are steps you can take to protect yourself from phishing attacks. Here are some tips:
- Be wary of unsolicited emails or messages, even if they appear to come from a trusted source. If you’re not expecting a message from someone, be extra careful before clicking on any links or attachments.
- Avoid giving out personal information online, especially in response to unsolicited requests.
- Keep your software and antivirus up to date. This will help protect your computer from malicious email attachments and links.
- Use strong passwords and two-factor authentication whenever possible. This adds an extra layer of security by requiring a secondary authentication code, such as a numeric verification code sent to your phone, in addition to your password.
By following these tips, you can help keep your cryptocurrency wallet safe from phishing attacks.
2. Defend Against Malware
Malware is a type of software that is specifically designed to damage or disable computers and computer systems. Malware can be used to steal personal information, delete files, or even take control of a system. There are many different types of malware, and new strains are constantly being created.
Cryptocurrency wallets are particularly vulnerable to malware attacks because they often store large amounts of digital currency. If a hacker gains access to a wallet, they could potentially steal all of the assets it contains. That’s why it’s important to keep your wallet secure and regularly backup your data.
In order to protect your wallet against malware, you should take the following steps:
- Keep your operating system and software up to date. Malware is often designed to exploit vulnerabilities in outdated software. By keeping your software up to date, you can close these vulnerabilities and make it much harder for malware to infect your computer.
- Use a reputable antivirus program and keep it updated. Antivirus programs can detect and remove most malware, but they need to be kept up to date in order to be effective. Make sure you have a good antivirus program installed on your computer and that it is set to update itself automatically.
- Be careful what you download and install. Only download files from trusted sources, and be careful what you install on your computer. If you’re not sure whether a file is safe, don’t download or install it.
- Be careful what websites you visit. Some websites deliberately host malware, so it’s important to only visit trusted websites. If you’re not sure whether a website is safe, don’t visit it.
- Don’t click on links in emails or instant messages unless you’re sure they’re safe. Many types of malware are spread by email or instant message attachments, so it’s important not to open any attachments unless you’re sure they’re safe. If you’re not sure whether an attachment is safe, don’t open it—delete the email or instant message instead
3. Be Wary of Social Engineering
When it comes to social engineering, the best defense is a good offense. That means being aware of the common ways that hackers try to trick people into giving up their information and being prepared with responses that will throw them off guard.
One common social engineering attack is called pretexting. This is when a hacker creates a false story or scenario in order to get you to share sensitive information. For example, they might pretend to be from your bank and say they need your account number in order to verify your identity. Or they might claim to be from tech support and say they need your password in order to fix an issue on your computer.
To protect yourself from pretexting attacks, always be suspicious of anyone who contacts you out of the blue and asks for personal information or login credentials
4. Lock Out Exploits
In the cryptocurrency world, there are many different types of wallets that you can use to store your coins. Some crypto wallets, like some brands of Monero wallet, are more secure than others, and some have features that make them more resistant to exploits. When choosing a wallet, it’s important to consider how you will be using it and what level of security you need.
To protect yourself against exploits:
- Use a wallet that is known for its security. There are many different wallets available, and some are better than others at protecting against exploits. If security is your main concern, choose a wallet that has been designed with security in mind.
- Keep your software up to date. Software vulnerabilities are often exploited by hackers. By keeping your software up to date, you can close these vulnerabilities and make it more difficult for hackers to exploit them.
5. Safeguard Your Hardware
Hardware wallets are one of the most secure ways to store your cryptocurrency. They provide an extra layer of security by keeping your private keys offline and away from potential hackers. When choosing a hardware wallet, be sure to research the different options available and select one that offers the features and security you need.
Once you have your hardware wallet, there are a few additional steps you can take to further protect it from attack:
- Keep your firmware up to date. Keeping your firmware up to date is important for any type of device, but it’s especially crucial for hardware wallets. New updates often include security improvements that can help protect your device from the latest threats.
- Set a strong PIN. When setting up your hardware wallet, be sure to choose a strong PIN that can’t be easily guessed. Avoid using easily guessed patterns like 12345 or 0000, and don’t use easily accessible personal information like your birthdate or home address.
- Back up your recovery seed. Your recovery seed is what you’ll use to recover your account if you ever lose access to your hardware wallet. Be sure to store it in a safe place that only you have access to, such as a fireproof safe or a safety deposit box.
- Use two-factor authentication. Two-factor authentication adds an extra layer of security by requiring you to enter a second code in addition to your PIN when accessing your account. This code can lock out hackers trying to get into your account if they don’t have a way to get past this second layer of security.
With the increasing popularity of cryptocurrencies, it’s important to know how to keep your digital currency safe from hackers. By following the tips in this article, you can help protect your cryptocurrency wallet and keep your coins safe. Remember to never share your private keys with anyone, keep your software up to date, and use a secure hardware wallet when possible. With these steps, you can help ensure that your cryptocurrency is safe from hackers.