• More than $3 billion in hacking loot in 2022
• Investors should keep their assets as safe as possible
• Cold wallets offer fewer opportunities for attack than hot wallets
Record year for crypto hacks
The year 2022 is probably a new record year for crypto hackers. According to Chainalysis, as of October 12, crypto hackers have already stolen more than $3 billion through 125 hacks. The month of October stands out in particular. According to this, October is said to be the month most affected by hacks this year. Between October 1st and 12th alone, a total of 718 million US dollars are said to have been stolen by eleven different hacks. Defi projects are the most common victims of hacking attacks, at more than 90 percent. According to Kim Grauer, head of research at Chainalysis, the hackers are so successful mainly because not enough resources are currently being devoted to cyber security.
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This is how investors can protect themselves
In order not to be one of the victims of hacking attacks, BTC-ECHO recommends taking five security precautions that are particularly important for crypto investors. First of all, you should make sure that you only buy cryptocurrencies from trustworthy providers. There are many ways to buy cryptocurrencies in the crypto market and many crypto exchanges differ in their functions. In addition, it has been the case in the past for owners of centralized platforms to simply shut down and flee with investors’ funds, so choosing a reputable provider is fundamental.
Another essential step in terms of security are strong passwords. Access data consisting of your own name, birthday or similar personal information are easy for hackers to decipher. The Federal Office for Security and Information Technology explains: “Hackers have tools that try out all possible character combinations fully automatically, test entire dictionaries including common combinations of words and numbers attached or try out access data that has been published on the Internet for all possible services. To prevent this, a Password meet certain quality requirements and can only ever be used for one access.” In order to make the password as secure as possible, you should use a variety of different letters, numbers and symbols.
If the password consists of a secure and strong combination of characters, the first step has already been taken. However, according to BTC-ECHO, security can be reinforced with two-factor authentication. With this method, which most wallets have, the user’s identity is verified during the login process. If the password was not sufficient security, the user account is protected by an additional security measure. If this involves biometric data, such as facial recognition and fingerprint scanning software, it is almost impossible for hackers to circumvent this measure.
Also, one should not rely on the services of third parties to store their digital assets. Rather, you should keep your cryptocurrency yourself, i.e. be your own bank. With self-custody, investors have complete power over their digital assets, meaning users have full control over sending, receiving and storing their cryptocurrency. This is possible by using wallets.
Lastly, one should always exercise extreme caution against crypto scams. Because all the security measures listed are of no help if a fraudster gains access to them through false trust. There are different types of scams to watch out for. These include cryptocurrency scams, cryptocurrency blackmail scams, social media cryptocurrency scams, giveaway cryptocurrency scams, fake app scams, love scams and phishing scams.
Hot or cold wallet
If you take the security measures to heart, you are a bit safer from crypto scammers. However, there are also things to consider when choosing the right wallet in terms of security. The important question is: Do you decide on a hot or a cold wallet? Hot wallets have the advantage that they offer their users a high level of convenience, as WiWo explains. Because the wallet is continuously connected to the Internet, users can trade their coins quickly and easily via different devices. This is particularly useful for users who trade regularly and want to react quickly to price developments. But even if the security standard of such wallets is very high, this constant internet connection is also a popular target for hackers. As BTC-ECHO explains, cold wallets in turn offer the advantage that these potential attackers have fewer opportunities to attack. The reason for this is that these end devices work without internet access and hackers would only be able to gain access offline.
E. Schmal/Redaktion finanzen.net
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