How Crypto Hacks Can Be Mitigated in 2023
In 2022, there were numerous and exceedingly damaging cryptocurrency hacks. It is estimated that approximately $3 billion was stolen, with the past 12 months being some of the worst in cryptocurrency history.
“There is no doubt that cryptocurrency hacks will remain a big threat to the industry – wherever there is wealth and opportunity, there will be criminals looking to exploit it. Now, more than ever, it’s essential to choose a platform that takes every possible caution to ensure that investors have peace of mind regarding their money,” says the Chief Research Officer of BTCC.
The Most Recent Crypto Hacks
The recent attacks have immensely impacted public confidence in cryptocurrencies, and the recent fall of FTX has only solidified that view. As FTX was known as one of the most secure exchanges, the fact that they were susceptible to hacking has lent itself to the notion of the cryptocurrency industry as being volatile.
However, those who are more positive deem this a temporary problem – with long-term value not diminishing.
These are some of the most notable cryptocurrency hacks and losses:
- Ronan Network – $625 million.
- FTX wallets hacked – $400 million.
- Wormhole Crypto Bridge – $320 million.
- Nomad Bridge Attack – $190 million.
- Beanstalk Farms – $182 million.
- Wintermute Hack – $160 million.
When a cryptocurrency is hacked, there is a marked increase in price volatility of the hacked cryptocurrency, but there are also ripples throughout the industry. Unfortunately, the moment the knowledge of a hack becomes public, there are often zero returns.
The high cost of cybercrime is not limited to cryptocurrencies but applies across the board. It is estimated that the global cost of cybercrime will be $10.5 trillion by 2025.
What Can Be Done To Minimize Risk?
There are several ways to prevent cryptocurrency hacks, including
Strong Passwords, Software, and Firewalls.
Keep your computer and mobile devices secure with up-to-date antivirus software and a firewall—using strong and unique passwords for all your accounts and enabling two-factor authentication (2FA) whenever possible. You must use strong passwords when logging in to websites, as well as a secure network. This way, none of your information will be accessed by undesirable people.
Keep your operating system and software updated to protect against known vulnerabilities, and do not share your private key or seed phrase with anyone. Keeping these numerical passcodes secret is of the utmost importance, and you must encrypt your data if you’ll be storing it somewhere.
Store your cryptocurrencies in a hardware wallet rather than on an exchange or a software wallet on your computer. It’s also a good idea to have more than one wallet to separate daily transactions from holding your assets, as this helps protect your portfolio and reduce the chance of crypto breaches.
Most investors should keep their assets not only in a hot wallet but also in a cold one. It is suggested that most money be kept in a physical wallet so that the more significant money will be out of reach from scammers.
Choose a trustworthy exchange.
It’s important for traders to carefully analyze the security features of the platforms they’re considering. Assess how your data will be protected using multi-factor authentication and SSL/TLS encryption, and base your choice of an exchange with this in mind.
Deciding on an exchange is one of the most important aspects of protecting your cryptocurrency; if the exchange is breached, so is your money. BTCC, for example, prides itself on being the longest running exchange, established in June 2011, and has not experienced a single hack since its creation. It’s important for users to choose a safe exchange with a good track record.
Beware of phishing scams.
You must be aware of these attempts to trick you into providing your personal information or login credentials. Don’t click on irrelevant links emailed to you or any arbitrary websites you visit.
Be wary when investing in something new, and don’t fall for assertions of quick money. It’s important to be aware of suspicious activity on your accounts and report it immediately so that prompt action may be taken to protect your assets.
Even with all the precautions, crypto hacks can still happen. As such, diversifying and not keeping all your funds in one exchange or wallet is crucial. It is also important to check the security of your exchange or wallet and its track record and follow the news to keep yourself updated about the latest crypto hack news.