A Guide to Protecting Your Tokens from Theft and Loss
Satoshi Nakamoto’s crypto wallet holds 1 million Bitcoin; 1/21 of the world’s supply.
The dollar value of the wallet is over $6 bn. The nature of Bitcoin means that if someone were to steal this money, they would be hard to prosecute.
This makes Satoshi’s wallet an attractive target for hackers. But so far, nobody’s managed to hack it. This crypto expert estimates that Google, the US government or the Chinese Communist Party will get there by 2027 - but only time will tell.
Meanwhile, other crypto wallet owners aren’t as lucky. Through 2017 and 2018, crypto exchanges lost over a billion dollars to hacks. Individual users constantly lose thousands and millions to fire, frost, fraud, forgetfulness, etc.
You don’t want the same thing to happen to you. Fortunately, this article will give you 8 ways to keep your own crypto safe. #1 is to…
1. Use an App to Make a Strong, Unique Password
In 2012, Jeremi Gosney made a unique computer and optimized it to crack passwords. Its guessing rate was 350 billion attempts per second; enough to crack most Bitcoin wallets in days if used today.
Devices and apps like these mean you need a strong password to offer any resistance to hackers. It’s best to use a randomizer app, rather than trust your imagination - and we also recommend using non-standard characters that aren’t found on regular keyboards (e.g. Ø).
Tip #2 is to...
2. Activate Two-Factor Authentication
Two-factor authentication gives your wallet another layer of security. It’s arguably the surest way for casual (and advanced) users to protect their wallet. You can learn how it works here - and once you do, make sure to activate the feature whenever possible.
3. Protect Your Inbox and Phone Number
Last year, Coinbase user Cody Brown lost $8,000 in tokens. This was through no fault of his own; Verizon let hackers “take over” his number after they provided his billing information.
To avoid situations like these, make sure to protect your e-mail and inbox - for example, by asking your mobile operator for added security measures. And, wherever possible…
4. Don’t Trust (All) Third Parties
It’s easy to assume that if a wallet is technically sound, your tokens are safe. Unfortunately, this isn’t the case. For example: a man lost over $30,000 after buying a Nano Ledger S because a retailer tampered with his device prior to the purchase.
The lesson here is simple. Don’t trust third parties - especially ones you don’t know. Stick to brands, apps and websites you can trust. And if you do have to work with a smaller third party, do your research first.
And if you want to be 100% safe...
5. Act Like There’s a Stranger in the Room
GovernX’s Nick Dodson recommends handling your crypto as if there were a stranger in the room. Tips include:
- Using an offline computer
- Keying in occasional gibberish
- Keeping cameras and mobile phones microphones away
These tips may seem a bit tin-foil-hat-y, but it’s better to be safe than sorry when money is on the line. This is also why more and more people are...
6. Using Deep Cold Storage
If you want to be really safe, store your hardware or printed wallet in a deposit box or a bank vault. This “deep cold storage” will all but guarantee your tokens remain yours. Additionally, you can add another layer of cold-storage security if you...
7. Distribute Your Seed Phrase
A seed phrase is a mnemonic combination of words that points to your private key. Whoever has it can access your wallet easily.
We recommend you distribute your seed phrase. Consider combining analog data carriers with digital ones; using locations that only you and your heirs can access; dividing the phrase among several people. This will make your cold storage more robust
Last but not least…
8. Consider All Angles of Attack
Last but not least: want to protect your crypto wallet? Anticipate how you might lose it - then take appropriate security measures. Foresee what hackers and criminals might do, then beat them to the punch.
How did you like this article? Please, let me know, I look forward to hearing your thoughts!
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Thank you for the fine recap... this is well timed, given today's story with Bankor. If even the large ones can't defend themselves, what's left for us, regular users?)) Just to use 10 small accounts instead of one...
Well, if you have your access codes protected enough, the risk is significantly reduced. However, the old saying about not putting all the egg in one basket is still very true))
Yeah. I've been into crypto for quite some time already - and it's like walking the minefield yet. On one hand you have huge price volatility, on the other there is constant risk or hacker attack. It's surprising that those hackers have lowered their barrier for potential target: a year ago I read in the magazine that if you are below $5K, there is nothing to worry and you're out of the scope. And it appears you are not; a friend of mine got hacked (his ETH wallet got compromised), and there was about $200 resting there. So noone is protected and safe!
Can't disagree. Safety is important regardless of your size. There are "too big to fail" but it seems that there are no "too small to be robbed" :(
Certainly there are not. Will you be doing more of those stories on security any time soon?
I will. If you can think of any topic that particularly interest you, feel free to propose. I appreciate all possible feedback))
Hmmm... Let me think of something. I recall you making some posts on ICO scams. Maybe it will be worth digging that way?
Keep up the good work and original content, everyone appreciates it!
Your post had been curated by the @buildawhale team and mentioned here:
https://steemit.com/curation/@buildawhale/buildawhale-curation-digest-07-13-18
Thank you!