Cyber criminals engage in many cryptocurrency scams
The popularity of cryptocurrencies is on the rise. It is not only getting attention from traders but also, on the downside, from some unethical elements of society that are bent on compromising the integrity and values of cryptocurrencies along with eating away investors’ hard-earned money.
Due to lack of regulation in the crypto space, the last few years have seen some significant data breaches and cyber-attacks. Cyber criminals engage in many cryptocurrency scams to launder money and dupe participants of their hard-earned money.
These attacks come in many forms, like phishing, ransomware, email scams, etc.
Cybercriminals work by either directly attacking the cryptocurrency exchanges or by creating risky or fake platforms to lure and manipulate their targets with a promise of wealth. They feed off the naivety and lack of knowledge of participants.
Let us discuss the types of threats and how we can arm ourselves against them.
Most Common Types of Cybersecurity Attacks
A phishing attack is done with a prime goal of attacking trading platforms for stealing their clients’ personal credentials. This data is later used by hackers to dupe the customers and extort money. Scammers achieve this by using similar names as legitimate platforms, which in turn, lures users into disclosing their credentials to them. Attackers send phishing mail using these authentic-looking domains that will then lead users to a spoofed website.
2-Third Party Applications
While third-party applications provide traders with an opportunity to monitor cryptocurrency prices as well as calculate potential profits, they can also pose a potential risk to its users. This is especially true for applications that require portfolio sharing with the developers. User data could hold valuable information for attackers since it can be used to identify targets for attacks.
Crypto-malware is software that is designed to damage an attacked computer. It is used by cyber-crypto criminals for ‘cyberjacking’. Cryptojacking is a crime wherein, unauthorized, the attacker uses the devices of participants to profit from it. In the crypto universe, cryptojacking is used on miners.
Crypto mining requires massive energy consumption and these cryptojackers unlawfully use another individual’s resources to mine cryptocurrency for themselves. While the process used by these hackers or jackers is the same as that used by legitimate miners, they leech off the resources of the infected machine to get payment.
Another form of malware is when hackers directly steal cryptocurrencies from wallets — cyberjacking the wallets.
In a ransomware attack, the target victim’s data files and programs are locked and encrypted to prevent their use. Unless some money is paid to the attacker, the data is not released. If the payment is not made, the attackers then trade the information on the dark web.
How to Alleviate the Impact of These Threats?
Cryptocurrency markets, as in any other financial market, have no shortage of risks. However, users can deploy some techniques like using proper security rules and by being extra careful with third party apps, random applications and sites to protect themselves.
Some precautions to take
Read the terms and conditions
Users must read and review all the terms and conditions before creating any account on trading sites, exchanges or information decimation platforms. These terms and conditions can be lengthy and tedious to read but it can guard investors against any unexpected consequences.
Always double-check websites before signing up or logging in
Malicious users keep making new domains to fool participants of their original identities. These homographic attacks are a way to lure customers, thus it is very important for cryptocurrency users to double check the websites and apps they visit. One way to ensure the legitimacy of a site is to check its certificate and whether the site is using HTTPS. It is also advised to bookmark frequently used sites.
Use multifactor authentication
Even though two factor authentication provides a great deal of security against malicious threats, relying only on two factor authentication may not be enough anymore. Already phishing agents have the same in place. It is better to choose sites that offer multi-factor authentication even if it means some added steps for entry.
Be careful when using third-party applications
Third party applications can come in handy due to the features they provide, but users must fully know the risk of trusting them and sharing their personal information. If the site looks dubious or too good to be true, it is better to avoid it altogether. We recommend that participants use cryptowire.in for data, information, research and knowledge on crypto coins and markets.
Use separate trading platforms and wallets
Investors should avoid using trading platforms, exchanges, as store for cryptocurrency as they risk losing assets in case the exchange gets hacked. A crypto wallet does not store an investor’s currency, but it holds the currency’s private key, which is, in turn, is used for trading. It is suggested that users transfer the coins to a trusted hardware wallet when not actively using them.
Do not share your private wallet key
When a participant opens a wallet with a wallet provider, he or she is given a set of keys. One is the public key that, in laymen terms, can be equated to an email address. The other key, is the private key or carrying forward the example, is the password to the email. Similar to a user sharing his email address while keeping the password private, in the cryptoverse the public key can be shared with other participants to transfer coins to your account. The private key must never be shared.
If someone gets access to your private key, then they may just as well empty your wallet and you lose your coins and holdings altogether.
Cyber threats are on the rise and we must arm ourselves against them. Cybersecurity, vigilance and trading should always go hand in hand. As global connectivity is increasing, so is the participant’s exposure to risk and cyber-attacks. With a little awareness, we can protect ourselves. Be safe be alert.
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