Since its launch in 2009, Bitcoin theft has been a global issue that has affected Bitcoin users. Since Bitcoin transactions are irreversible and anonymous, its decentralized nature makes it a desirable target for hackers. Because Bitcoin is not subject to centralized regulation, it is a popular target for online criminals. Most hacking incidents involving online wallets and cryptocurrency exchanges involve Bitcoin theft. There have been many well-known instances where cyberattacks bring about the loss of millions of dollars in BTC. Individuals and organizations have suffered substantial financial losses due to these attacks, which has reduced confidence in the Bitcoin industry. As the crypto industry develops, so does the number of cyber thefts and attacks against people who own crypto, exchanges, and smart contracts.
The number of crypto thefts has increased tremendously, especially during the pandemic. Recently, a hacker stole $600 million by exploiting a vulnerability in his Poly Network, a platform that connects multiple blockchains. A significant increase in cyber theft has been reported in 2021. When a digital asset is lost, hackers seem to disappear onto the internet. A lack of ID, with digital assets, makes it hard to be traced or recovered due to the decentralized system.
Reports like this make one determination to protect digital assets increase and make many ask, “What are the best ways to prevent Bitcoin theft”?
What can be done?
1. How safe is your exchange platform
The foremost question you must ask is, “How safe is the exchange platform you use to store your Bitcoin? Often, exchange platforms make transactions easy as they provide vital services for smooth trading. This confidence in them also attracts cyber thieves. Some people store their Bitcoin on cryptocurrency exchanges that facilitate cryptocurrency trading. Although these platforms have their measures to protect digital currencies, they are not immune to crypto hackers and thieves. It can be an avenue where you can lose money if care is not taken. After completing your transaction, you must move the virtual currency from the exchange. It is also essential to thoroughly research the platform you are using to confirm how secure it is. Keep in mind that if anything should happen to your assets, there is no way to get them back.
2. Wallet backup
Since crypto theft usually happens through crypto wallets, you should take extra steps to protect your wallet. Investing in a trusted crypto wallet is one of the best ways to protect your cryptocurrency. So you can avoid crypto wallet scams. A hot storage wallet exists online, storing its keys in an online app or software. These are usually protected by two-factor encryption. Similar to online banking systems, crypto assets can be transferred instantly. To keep your online wallet secure, you should always use two-factor authentication.
Keep your private key safe in an offline location. Another type of wallet is a physically existing cold storage wallet. It looks like a standard USB drive but is passkey protected. Cold storage wallets are generally considered more secure as crypto thieves cannot hack them. Even if your cold storage (hardware wallet) is stolen, your cryptocurrency will still be protected as it will be locked using his PIN code. However, you are responsible for keeping your cold storage wallet in a locked vault to prevent it from being stolen.
3. Protect your device
If you store cryptocurrency on your devices, you should take steps to keep those devices secure. According to the latest report by the Anti-Phishing Working Group, one-third of her computers have been targeted by malware attacks. Most computers do not have enough security to protect cryptocurrencies. To protect your device, you need to avoid using unprotected wifi and clicking on or downloading from websites that are not protected. You also need to use strong passwords for essential apps such as trading apps. Install an antivirus and antimalware program to protect and run your device regularly. You can also encrypt all data on your device. Use an operating system such as Linux, which is less susceptible to malware attacks than Windows.
4. Remember two-factor authentication
When you buy cryptocurrencies for the first time, you are usually in an exchange account. Once a hacker gains access to this account, he can “withdraw” cryptocurrency to his address in wallets under his control. One of the easiest things you can do to thwart these attacks is to ensure that you buy cryptocurrencies securely and then enable your two-factor authentication (2FA) for withdrawals on the enabled exchange app. 2FA requires you to enter a code from your mobile phone when you withdraw cryptocurrency. It’s annoying if your phone runs out of battery or you have to go to another room to get your phone when you want to withdraw funds. But you also won’t lose your crypto if an attacker gains access to your account.
An attacker could steal the password from another website and crack it using hash-cracking software. Or it could get him to download a malware file via email, steal his password and use “reset password.” Ability to control Exchange accounts. Hackers use these standard techniques to steal crypto from exchanges but are much less likely to succeed if 2FA is enabled. If 2FA is enabled, the attacker must follow these steps to convince the phone company to transfer phone service to the attacker’s phone, and this allows them to receive your text messages and a code for you. The extra hassle a hacker has to go through to make a withdrawal is often enough to deter an attack from completing.
5. Paper wallet
These are generated by web platforms such as BitAddress and WalletGenerator. These applications can create and print Bitcoin addresses and private keys. Once your paper wallet keys are printed, you can remove them from your online wallet and network. CryptoHex wallets take it further by engraving essential information onto a metal strip. Though there have been more technological improvements than when the paper wallet was created, it is still a reliable way to store your keys. They are removed from the internet, which makes it even more secure.
6. No one needs to know
No one knows how much cryptocurrency you own unless you tell them. There have been several instances of investors being cheated after bragging about their holdings. Avoid discussing cryptocurrency investments in public forums and limit exposure. You are responsible for your asset, so you shouldn’t give others information about it. Don’t forget that even seemingly little mistakes can cause you a great fortune to be able to transact successfully; the theft of Bitcoin must be avoided. Compared to conventional banking systems, Bitcoin is safer because it is a decentralized network. However, to maintain the security of their Bitcoin assets, investors need to be watchful and adopt extra security measures.
7. VPN- your bulletproof
While you are careful not to be a victim of crypto theft, you often still need to make transactions involving digital assets. The Virtual Private Network protects you from man-in-the-middle (MTM) attacks as it helps with extra layers of internet security (encryption). It makes it difficult for anyone to attack you while a transaction is ongoing. Incorporate a VPN as part of the steps to enhance the protection of digital investment.
Conclusion
Users are urged to use hardware wallets, which keep private keys offline, and other wallets that provide high degrees of security. To safeguard the assets of its consumers, businesses, and exchanges must implement more robust security methods and systems. Additionally, it is advised against keeping Bitcoins in virtual currency exchanges or online wallets for an extended period. The above methods are not exhaustive. There are many ways crypto thieves can steal cryptocurrencies, and all these methods should be combined to keep your crypto assets as safe as possible. Cryptocurrencies have presented many opportunities for investors. But also presented their unique challenges. Taking precautions can protect your money, limit losses, and take advantage of cryptocurrencies’ benefits.
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