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Take a hybrid approach to digital wallet security

Online wallets have gained popularity and have attracted an interest from hackers. Physical or offline wallets are recommended for the storage of the majority of the cryptocurrency a person’s wallet, with a smaller amount of money in an online wallet advises Terence Jackson, chief information security officer at Thycotic, an Washington D.C.- based supplier of secure access management solutions. “The physical wallet should be kept in a safe location, such as a safe , or safe deposit box,” Jackson says. “I recommend separating the public and private keys. Both should be secured by secure passwords and multifactor authentication whenever feasible. If cryptocurrency grows popular alternative options will be available However, for the moment you are accountable for protecting your cryptocurrency.”

The rise in popularity and prices of Bitcoin and Ethereum makes virtual currencies are often a potential target for hackers looking to gain access to these precious assets. “The economy of cybercrime suggest that hackers will continue to be drawn towards cryptocurrency as the rise their value, and also become prominent in our life,” claims Jack Mannino who is the director of nVisium which is a Falls Church, Virginia-based application security firm. The task of identifying the activities of hackers can be difficult because their footprints are removed electronically. If a cryptocurrency account gets compromised, the investors don’t have recourse legally because the digital currency is currently not controlled by a government agency as well as a central bank. Here are 10 ways of security of the investment in cryptocurrency and how to implement theft protection.

Use a mix of approaches to secure your digital wallet.

Online wallets have gained popularity and have attracted an interest from hackers. Physical or offline wallets are recommended to store the bulk of the cryptocurrency a person’s wallet, with a smaller amount of cash in an online wallet advises Terence Jackson, chief information security officer at Thycotic, which is a Washington D.C.- based company that offers secure access management solutions. “The physical wallet must be kept in a safe area such as a safe , or safe deposit box” Jackson adds. “I recommend that you separate your public and private keys. Both should be secured by secure passwords and multifactor authentication whenever it is possible. If cryptocurrency grows popular and more traditional alternatives will be available However, for the moment it is your responsibility to making sure your cryptocurrency is secure.”

A strong and secure password is the key.

Don’t reuse passwords across multiple accounts, particularly since cryptocurrency-related services are the most popular targets for hackers. Take for granted that all of them will be at risk of security breaches, advises Kevin Dunne, president of Greenlight, an Flemington New Jersey-based supplier of risk management services that integrate. “While cryptocurrency is an exciting technology that is rapidly evolving one of the fastest and most effective method to secure your wallet is through the tried and tested security strategies,” he says. “Limit your risk of being exposed by having an individual, secure password for each one, along with 2-factor authentication, and password-rotation when it is possible. A trusted password manager can assist to streamline this process and remove the guesswork out of it.”

Use trusted cryptocurrency exchanges, wallets and brokerages, as well as mobile applications.

Before choosing which platforms to select, investors should take the time to research the security options to determine the ways their information is protected. “Entities that are trustworthy should adopt the most effective security practices, like the use of multifactor authentication as well as SSL/TLS encryption, and using air-gapped devices which are offline when keeping digital currency,” says Austin Merritt Cyberthreat Intelligence analyst with Digital Shadows, a San Francisco-based company that offers cybersecurity solutions to protect against cyber-attacks. If you are using more than one platform is safer in the event that owners utilize various, intricate security passwords on each of the platforms. “Whether you’re using one or more platforms for cryptocurrency it is crucial to have a secure security system for your password to guarantee passwords aren’t lost” he adds.

Beware of mobile scams.

Many users with cryptocurrency wallets use an app on their mobile to manage it. With these commodities soaring in value, criminals are eager to target investors through mobile phishing attacks to steal the login credentials of users, according to Hank Schless, senior manager of security solutions at Lookout which is an organization based in San Francisco that offers secure mobile solutions. The social engineering attacks could originate from any mobile device, which includes text messages, social media platforms and third-party messaging platforms, as well as email. “Beyond the threat of phishing, there’s some mobile applications that have the capability of logging your keystrokes, or monitor your activities on your screen,” the author says. Many people use anti-virus software onto their computer but they are now beginning to realize that they must follow the same process with their tablets and smartphones. “Considering how much information we trust to these devices, they’re the most critical to secure,” Schless says.

Make sure you know how your wallet is used during transactions.

Implement the fundamental concepts that comprise “cyber resilient” for your bank account, according to Dirk Schrader, global vice president of New Net Technologies, a Naples Florida-based company that offers security and software for compliance. “Any cryptocurrency wallet is a piece data and code, but it is one that has significant value to you and for other people. Be aware of how it’s used for transactions, and ensure that your systems and networks aren’t compromised when you use them to conduct transactions, and have physical security put in the place,” he says. Investors who invest in higher-value assets must be aware of the risk. “Cyberattacks are deliberately staged. They first establish a foothold and then expand their reach before attacking the primary victim (your bank account),” Schrader says. “The security measures that are applied to your wallet will only be as effective as the knowledge you have of the rules.”

Learn about the various methods and procedures to safeguard your cryptocurrency.

The investment in cryptocurrency continues to grow in popularity among those who don’t have a background in technology but are looking to diversify their portfolios. There is no way that digital assets are controlled by an authority-based institution or central bank and therefore the obligation to safeguard your funds rests, “almost completely on the individual user,” says Brandon Hoffman the director of information security of Netenrich, an San Jose, California-based provider of IT cloud, cybersecurity and processes and solutions. The probability of recovering losses is extremely low. The three main components to know about are security keys that secretly protect you security, recovery seed protection and cryptominer malware security.

Do not share the secret key.

It is the secret keys that verify that the person who is sending or receiving digital currency owns the digital wallet utilized, Hoffman says. The secret or private key is not to be shared. “The most secure method to store your private key is making use of cold storage” He says. “Cold storage is basically printing out your keys and removing all digital evidence that it has.” The safest method of retrieving your key private is to make use of the seed, which is a sequence of random words that the user is able to leverage. “This word should be printed or written on paper and kept somewhere secure,” Hoffman says. “With the ease at which hackers can gain access to machines used by end-users and other storage apps for digital data keeping this message digital is extremely risky.”

Do not use wallets that are hosted by providers.

Other options for storing Bitcoin include wallets hosted on your desktop or laptop as well as wallets hosted by service providers. These wallets hosted by service providers are the “worst option as you are giving them permission access to your personal keys on their servers that are completely out of your control,” Hoffman says. “This can be the best and most commonly used option because it is the least technical effort. Your private keys are placed at risk, including an attack on the provider’s server or the company closing its doors or even the takeover of your infrastructure by government agency or another legal organization.” Make use of a hardware wallet that is a USB-based device that is able to store and protect your private keys along with the other pertinent information according to him. The method used to decrypt these keys can be physical, and much more secure compared alternatives.

Cold wallets come with their own drawbacks for traders who are active.

The cold wallet is totally offline, and you must either write an address for the personal account on a piece paper only the owner can access or buying a device that is secure in storing the cryptocurrency’s funds, says Thomas Beek, senior cybersecurity specialist at Digital Shadows. The disadvantages are the time needed to keep your cryptocurrency and, when you’re engaged in trading activities and the process of “consistently transferring funds from exchanges as well as the wallet may be a source of repeated withdrawal charges,” he says. “The advantages of cold wallets include the peace of mind knowing that you are the only one with access to your money.”

The hot wallet is more suitable for traders, however, they can also be more risky for traders.

Retail investors can make use of hot wallets, which is a storage option which is connected to the internet throughout the day to make it easier to access the capability to buy and trade other cryptocurrency more easily and efficiently, like Coinbase as well as PayPal, Beek says. The downside is security, and trusting the platform with the security of your private and public addresses that “historically has led to the loss of substantial funds due to the breach of the exchange” Beek says. This is a scenario that is only relevant to active traders. However, the amount of money they require access to must always be assessed. Hackers are always looking to target big exchanges, particularly when the numbers of investors who are retail. “Irrespective whether the platform is decentralized or centrally managed with no proper storage procedures used by the investors themselves, they’re likely to be vulnerable to an attack that could be threatening,” he says.

Strategies to protect your cryptocurrency:

Consider a multi-faceted approach to secure your digital wallet.
A strong and secure password is the key.
Use reliable cryptocurrency wallets, exchanges and brokerages, as well as mobile applications.
Make sure you are safe from mobile scams.
Be aware of how your bank account is used for transactions.
Learn about the various methods and methods to safeguard your cryptocurrency.
Do not share the secret key.
Avoid using wallets hosted by service providers.
Cold wallets are not without their disadvantages for traders who are active.
Hot wallets are convenient for traders, but the losses can be more severe.