Cryptocurrencies are supposed to offer a safe, recorded and computerized form of transactions of assets. They are secure as digital assets themselves. However, there are current security risks when cryptocurrencies are purchased, sold and stored. Everyday transactions that involve buyers and sellers are becoming stronger magnets for fraud. Users grossly underestimate the security risk when they exchange cryptocurrencies.
4 Common Ways Hackers Can Steal Your Cryptocurrency
Ransomware is nothing new and is most likely something everyone has heard concerning cybersecurity. Ransomware is becoming even more infamousbecause of recent security breaches by hackers in cryptocurrency. Hackers typically target organizations that have a reputation for customer service. This fact guarantees a higher probability of a successful payout for them.
How Ransomware Works
- Ransomware encrypts some or all of user data. It then locks it up and makes it impossible for the user to access their data.
- The hackers give victims the choice of paying a specific amount of money all for the documents to be unencrypted.
Who is most vulnerable to these attacks?
- Anyone can fall prey to hackers ransomware attacks whether its individuals or organizations.
- Individual users are more accessible targets as they do not have the tools or information to decrypt the required files.
2. Fake Wallets
Fake Wallets are a popular method for hackers to steal your money. The use of Fake Wallets has prevailed because they still manage to scam bitcoin users. Surprisingly, some Fake Wallets have also shown up on the Apple’s App Storeafter effectively sneaking through all the steps of verification process. Fake Wallets are responsible for giving Bitcoin and cryptocurrencies a bad name.
How Fake Wallets Work
- Fake Wallets are replications of an individual user’s wallet that will appear to be genuine at first glance because it uses the real wallet’s logo.
- It steals coins before the user detects the fraudulent wallet.
How to Protect Yourself
- To make sure you are not a victim of this tactic, download the apps from a reliable source such as the wallet’s site only.
3. Bitcoin Phishing
Phishing is a method hackers use to trick users into divulging their user credentials by sending spoofed websites to users email addresses. This is the most popular method that hackers use to obtain sensitive user information.
How it works
- Hackers will attempt to trap the victim into giving them significant news about their crypto assets.
- The user then types in their user credentials to log in to the fake website to make sure their crypto assets are alright.
- It is often done by email from an address that looks very genuine.
How to Avoid it
- Never click on a link to a website and type in user credentials
- Always make sure there is an https:// at the beginning of any website you enter private personal data
4. Fake Cryptocurrencies
The most famous fake cryptocurrency to date is OneCoin. Fake cryptocurrencies work by convincing users that they are purchasing units of digital currency. When in reality, they are merely paying for numbers to appear on a website.
How it works
- OneCoin convinced it’s user base that it had a private blockchain
- The only way to exchange OneCoin was on their private exchange
- It also claimed it sold educational tools to make money and not cryptocurrency. This claim wasn’t true.
How to avoid being a victim
- If you are looking for an ideal cryptocurrency to invest in, it is essential that you do your due diligence
- Do not get swept away by anything that guarantees an instant high returnbecause it most likely is a hoax
There are always risks when you invest your money anywhere.Cryptocurrency is a step in the right direction for detecting and preventing fraudulent transactions. Every transaction is recorded permanently on the blockchain ledger. However, hackers have found ways to infiltrate users data. The future of cryptocurrency depends on effective methods to keep crypto assets secure.
We’ll be sharing more posts like these on cryptocurrency security as we launch https://www.formosa.financial an institutional grade custodial service for high net worth traders, businesses and their complex needs. Feel free to tweet