Online currency can invite data breaches often. While some investors see cryptocurrency as a great investment, others may take it as an opportunity to hack systems, scam you, and steal your money online.
In 2022 alone, cybercriminals targeted the cryptocurrency industry and stole over $2 billion from crypto exchanges.
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So, you need to stay alert for any fraudulent activity from fraudsters looking for any loophole in your crypto wallet. Let’s look at how you can do that.
How Is Cryptocurrency Hacked?
The open-source environment has played a huge role in growing the cryptocurrency industry. However, it has also opened pathways for hackers to carry out potential breaches. One commonly implemented hacking strategy is social engineering.
Social engineering happens when a hacker emails a targeted cryptocurrency owner and forges a message or email from their crypto exchange. The email urges the owner to log into their account through a given link. The page they’re redirected to is a replica login page.
But when the owner enters their credentials, these are provided to the hacker instead. So, it’s important for people involved in crypto to take additional precautions.
How to Keep Your Cryptocurrency Safe
Let’s look at some ways you can keep your cryptocurrency safe:
But not just any wallet will do. So, it’s always important to do your research and use a reputable wallet where you can store your cryptocurrency away from hackers.
Two-factor authentication (2FA) requires you to input a code sent on your phone every time you make a crypto withdrawal. It can seem like too much work, but it saves you from losing your crypto information in case an attacker gets access to your account.
If you use software to manage and use your cryptocurrency, it’s important to have the latest security updates and bug fixes.
Cryptocurrency wallets and other related applications can face security vulnerabilities, reduced functionality, and bugs if the software is not regularly updated.
Phishing scams are a common tactic used by cybercriminals that helps them get hold of your personal information, including financial passwords and other credentials. Phishing can come in to form of fake emails, websites, or pop-up advertisements. These often look like legit sources.
So, it’s important to check the domain name matches the original company before clicking on a URL. Also, stay aware of unsolicited emails and always use the two-factor authentication set up when and where possible.
If you already use a hardware wallet, you may be aware of seed words. Storing these seed words is essential. If you don’t, you can lose all your cryptocurrency the moment your device crashes. So, always back up your seed words.
Need help? Accounting Tax Solutions are knowledgable with cryptocurrency and can help you with yours. Call us today on 07 5559 1200 or email us at info@accountingtaxsolutions.com.au