Cryptocurrency trading can offer substantial returns, but it’s also fraught with risks that extend beyond much-publicized market volatility. We are of course talking about cybersecurity snafus, and traders often stumble into a number of predictable and arguably avoidable pitfalls.
To avoid becoming one of the many who’ve had their crypto assets compromised and their data exploited, stick around as we explain the main mistakes you need to know about, and how to deal with them deftly.
Weak Passwords
Often, traders use passwords that are too simple or relevant to their personal information (like birthdays or pet names). This habit makes it easier for cybercriminals to gain access through brute force attacks or social engineering – and as many as 75% of people fall foul of this issue.
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Moreover, using the same password across different trading platforms can be dangerous. If one platform suffers a breach, all accounts with the same credentials are at risk.
For instance, if a trader uses “Crypto123” on three different exchanges and one gets hacked, the remaining two become low-hanging fruits for attackers.
So, here are some strategies for stronger password security:
- Use a password manager to generate and store complex passwords.
- Enable two-factor authentication (2FA) wherever possible, adding an extra layer of security even if your password is compromised.
- Regularly update your passwords every few months to tighten security loopholes proactively.
Phishing Attack Exposure
Phishing remains a persistent threat in the cryptocurrency sphere, costing $1 billion collectively according to one report. Understanding its mechanics and adopting stringent preventative measures can shield your assets from these deceptive schemes.
Firstly, you need to know that cybercriminals will craft emails that mimic legitimate communications from reputable cryptocurrency platforms or financial institutions to steal login credentials.
For example, an email designed to look like it’s from a well-known exchange might urge you to “urgently” update your security settings through a malicious link.
Common signs that a message isn’t legit include:
- Unsolicited requests for personal information.
- Urgent or threatening language pushes you to act quickly.
- Links that do not match the genuine URL of the purported sender when hovered over with your mouse.
And here are some defensive tactics to deploy:
- Always verify the authenticity of communication by contacting the company directly via trusted channels before clicking on any suspicious links.
- Implement email filters and security software that help detect and block phishing attempts.
- Educate yourself regularly about new phishing techniques and trends in cybersecurity threats related to cryptocurrency trading.
Also be sure to research reputable trading platform providers, and get familiar with their branding and how they communicate with customers. For instance, it’s easy to look into a crypto OTC platform that has a handle on user privacy – not just as a means of choosing where to carry out trades, but also to ensure you’re better informed as and when a phishing campaign targets you.
Unsecured Connections
Trading cryptocurrencies requires a secure internet connection. Unfortunately, many traders overlook this, accessing their trading accounts over public Wi-Fi or less secure networks.
This is a problem because public networks are notorious for their lack of security features, making them breeding grounds for man-in-the-middle attacks where malicious parties intercept data sent from your device to the network.
So for instance you might log into your trading account at a coffee shop and have a hacker on the same network silently capturing your login details.
Here’s how to keep your trading interactions secure:
- Avoid using public Wi-Fi for trading. If necessary, use a reputable Virtual Private Network (VPN) or an equivalent to encrypt your internet connection.
- Ensure that your home Wi-Fi is secured with strong encryption (like WPA3), and its firmware is regularly updated.
- Turn off sharing settings and Bluetooth connectivity when trading in public places to minimize the risk of unauthorized access. Also consider setting up a hardware wallet to store your crypto assets, rather than relying on any third party platform to keep hold of them.
If you’re looking to create crypto exchange platform, integrating robust cybersecurity measures from the outset is crucial for protecting your users and maintaining trust.
Final Thoughts
Having good cyber habits when it comes to trading crypto is just as important as in any other use case for online services, so brush up on your skills and don’t take chances – or it could be more than just your portfolio on the line.
