Crypto Wallets: Avoiding The Greatest Security Threats To Your Assets

Crime, FinTech, Innovation, Investing | September 26, 2018 By:

The conversation around cryptocurrency has centered around the existence and invention of bitcoin. Nine years and 28 million crypto users later, it shows no sign of slowing down. However, despite increased awareness, the hype surrounding the digital currency is likely preventing users from seeing the biggest threats to their crypto assets. According to a recent study by finder.com, 35 percent of Americans state that the risk involved with investing in cryptocurrencies is too high, a belief that currently prevents hundreds of millions of investors from investing in cryptocurrencies.

The fear that is preventing broader investment in cryptocurrency stems from a lack of reliable cybersecurity solutions amidst relentless news of crypto theft. Each day, over $9 million dollars is stolen from crypto wallets. Regulatory agencies such as the FDIC or Consumer Protection Bureau are not helping the needs of crypto holders, who must live with a fear of having their crypto stolen by hackers.

Blockchain technology is fundamentally secure with cryptographic algorithms and decentralized storage, however, access to the blockchain is not secure and can be easily compromised. The reality is that crypto wallets are under attack and it’s time to get clear on what the biggest threats facing them are.

Keyloggers

Used to monitor and record each keystroke typed on a desktop or mobile keyboard, keyloggers are often used by hackers to steal crypto wallet passwords, online login credentials, breach corporate networks, and access private keys.

Clipboards

Most crypto users copy and paste their destination address to transfer crypto funds. Because of the complexity and length and of the address, copy and paste is commonly used among users. Hackers can find addresses by scanning the clipboard and modifying it to paste a different address. Most times, the user is not aware of the modification. By the time the user clicks send, their money is gone. And unfortunately, once crypto funds are gone, they’re gone for good.

Malware

Every four seconds, hackers release a new strain of malware designed to infect blockchain endpoints. Malware can infect JavaScript plugins ( ex: Chrome extensions) and copy private keys. Hackers steal private keys by finding data that resembles a crypto wallet key. Another popular attack among hackers is mining malware. Hackers harness processing power of infected computers to mine cryptocurrency. According to a recent study from Kaspersky Labs, a single cryptocurrency mining botnet can net cybercriminals more than $30,000 per month.

Unsecure Wi-Fi Networks

Unsecured internet connections serve as a hotspot for hackers to steal information. Hackers can easily collect information such as a user’s activity and private information.  Hackers can also set up fake public wi-fi networks and name them after nearby businesses. This tactic traps users into becoming victims of an attack without even realizing it. Hackers can also use unsecured Wi-Fi connections to distribute malware.

Understanding the biggest threats to crypto wallets will help users prioritize security when handling their crypto assets. Hackers are taking advantage of blockchain hype by preying on the lack of knowledge among users and the existing vulnerabilities within the blockchain ecosystem. Anyone can fall victim to these attacks and is the exact reason why it’s vital to be aware of the biggest threats facing crypto wallets.