Any crypto enthusiast will tell you that keeping their coins and tokens safe is the one thing that keeps them up at night.
Cryptocurrency’s unregulated and decentralized nature has made it a prime target for cybercriminals.
One of the most prominent examples we’ve seen is the Mt Gox collapse which resulted in untold billions of losses. Other scandals include crypto wallet hacks where thieves stole tokens stored on these platforms. Sometimes not all of the best free crypto wallets are trustworthy enough to save there your funds.
Lost Forever: Stolen Crypto Tokens
Worse still, it is frequently next-to-impossible for authorities to recover any lost funds. While crypto thieves can and have been prosecuted for theft, such cases are rare. This is because crypto transfers are difficult to track, and digital currencies are not recognized as legal tender.
But, strong coin valuations and rising adoption rates make it challenging to ignore cryptocurrencies. This is why enthusiasts use a combination of good security hygiene and hot and cold wallets to secure their assets.
However, cybercriminals are getting increasingly sophisticated, making it difficult to stay ahead. Hence this is why I’ve put together a list of the most common crypto wallet scams going around nowadays:
Look Out For These Scams
Fake crypto wallets or apps: These often come in the form of malicious apps that either impersonate legitimate wallets or autonomously transfer your tokens to another address.
Phishing: One of the oldest yet most dangerous scams around. Scammers send out a fake email asking for your personal information, i.e., wallet address, passwords, TAC, or pin codes. They also make use of social engineering to trick victims.
Always remember that crypto wallets and banks will never ask for your password or for you to transfer funds to another account.
Romance scams: The elderly and lonely often fall for these schemes. Perpetrators manipulate victims into sending compromising images and then blackmail them for money. Others trick their victims into sending over money/crypto and disappearing without a trace.
Now that you know what you should be looking for, let’s look at how you can tell if a crypto wallet app is safe to use.
A Reputable Source Offers It
If a reputable exchange or company offers a wallet, it’s probably safe to use. Notable service providers include Binance, Crypto.com, and Coinbase. All are established names in the crypto scene with a proven safety track record.
To ensure you’re being directed to the right site, you can also visit the service provider’s homepage. They usually have links that will take you directly to Google Play or Apple’s App Store.
The Wallet Comes With 2-Factor Authentication
2-Factor Authentication 2FA is one of the best ways to prevent unauthorized access to your crypto wallet. It works by requiring multiple authentications to unlock your wallet — one on your PC and the other on a mobile device.
So, even if hackers gain access to your passwords, they cannot access your crypto wallet without your physical device. Wallets with 2FA are resistant to brute force attacks, phishing, and social engineering.
It should be one of the main deciding factors on your list when shopping for a crypto wallet app.
No Viruses Are Detected On It
As a rule of thumb, you should perform virus scans on any new app downloads. This allows you to detect if you’ve accidentally downloaded any malicious software onto your phone. Given the trend of scammers using fake crypto wallets to steal tokens, such measures go a long way towards keeping your coins safe.
While technology has come a long way, good safety habits are the only foolproof way to safeguard your assets.
And with rising rates of crypto adoption, we can only expect cybercriminals to become even more active.