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Is Bitcoin Safe? How to Protect Bitcoins and Addresses from Hackers

Is Bitcoin Safe? How to Protect Bitcoins and Addresses from Hackers

Keeping your cryptocurrencies secure is key to building a digital fortune.

It’s hard not to be enticed by the craze and hype surrounding cryptocurrencies, especially spil the prices of two popular digital currencies, Bitcoin and Ethereum, have spiked since the beginning of the year. But is Bitcoin safe?

The dangers of dealing with cryptocurrencies are just spil real spil the money-making opportunities. There are many ways you can lose your digital fortune ter a flash, especially spil hackers have set their eyes on the masses of fresh users rushing to open up crypto-wallets and invest ter Bitcoin and other digital tokens spil the prices surge.

So, if you’re one of the millions of users who leaped on the Bitcoin bandwagon ter the past few months, this guide will help you protect your cryptocurrencies against the threats that riddle the landscape.

How to protect your Bitcoin

1) Avoid address errors

One of the most attractive aspects of cryptocurrencies is the immediacy of payments. An address is all you need to make a payment to a seller, friend, or employee. Likewise, te order to receive payments te crypto, you only need to provide your address. There’s no middleman to verify the transaction, and spil long spil it’s a valid address, the payment will go through.

However, this can also lead to some terrible errors. A typo can send all your coins to the wrong address, accidentally enriching some random fortunate person or a hiding hacker. And te case you didn’t know already, transactions made te Bitcoin and other cryptocurrencies are irreversible, so there’s no way you can recover the funds you’ve sent to a wrong address.

The very first order of business should be to protect yourself against… yourself. Avoid typing Bitcoin addresses by hand when sending or receiving payments. It’s very effortless to mistake an “0” for an “O,” a “1” for an “I,” or to miss and displace characters when typing ter an address. Use QR codes when available, or copy and paste addresses when making or receiving payments.

A Bitcoin user asks for donations with his QR code, a secure way to send or receive bitcoins.

Also, double-check your final address before submitting a payment. Even copying and pasting can go wrong if your rekentuig is infected with address-manipulating malware. CryptoShuffler, for example, sits ter the background and monitors your clipboard. Whenever you copy a Bitcoin address (presumably to paste it into an online payment application), it interchanges it with its own address. Therefore, if you’re not wary, you’ll end up sending your money to a hacker’s address. CryptoShuffler has so far succeeded ter collecting more than $150,000 for its developers.

Two) Keep your Bitcoin wallet secure

Most hackers go after the money, and online Bitcoin wallets are attractive targets. A very real threat to avoid is phishing scams. Malicious actors will attempt to trick you into providing away your username and password by sending you linksom to fake login pages that mimic that of your online wallet. They could install keylogger malware that steals your password spil you type it or by using some other devious method.

Having an updated antivirus software will protect you against most malware, but social engineering attacks such spil well-targeted spear-phishing emails are more complicated and can get past even the best security contraptions. Spil a rule of thumb, never click on email-embedded linksom to your online wallet, even if they look like they point to your online wallet webstek. Either use a bookmark or type the address by hand.

You should also enable two-factor authentication (2FA) on your online wallets. Two-factor authentication ties a physical device to your wallet, whether it’s a phone, an authenticator app such spil Google Authenticator, or a physical key such spil the Yubikey. Whenever a user wants to login to your account, they’ll have to present proof of the 2nd factor. This could mean typing a one-time password that emerges te the authenticator app or inserting their physical key into the rekentuig. With two-factor authentication, even if a hacker manages to steal your password, they won’t be able to access your account.

Most wallets give you granular control overheen 2FA settings, such spil applying it to login attempts, payments, or both.

Most online wallets also enable users to recover their password through the email that is linked to their account. This means that hackers will be able to pauze into your wallet if they hack your email. This stands true even if you’ve set up two-factor authentication for your wallet.

Ter order to minimize the threat of an email takeover, use a separate email for your online wallet, and use a secure provider such spil ProtonMail or Lavabit.

Three) Use an offline Bitcoin wallet

Before I tell you why you should use an offline wallet, here’s a geschreven primer on how cryptocurrency security works. Bitcoin and other cryptocurrencies are based on public/private key encryption. For every Bitcoin address, there’s a public encryption key, which everyone can use to send you funds. There’s also a private key, which only you should be able to access. The private key is what enables you to make payments from your account to others. If someone gets hold of your private key, they will be able to siphon all your funds to their own address.

Most online wallets store your private keys and keep them secure. And to be fair, they have reliable security. But every once te awhile, even the most secure services fall victim to gegevens breaches. Ter 2014, famous Bitcoin exchange Mt. Gox wasgoed robbed of 850,000 bitcoins, worth $460 million at the time (te current BTC prices, the hack would be worth $9.Five billion). Last year, Bitfinex, another popular cryptocurrency exchange, lost $60 million worth of Bitcoin to hackers.

The point is, no matter how secure an online wallet is, it can be hacked. An alternative is to use an offline wallet, also known spil a cold storage. Offline wallets give you utter control of the private key and don’t store them te an online service. Trezor and Ledger are two popular offline hardware wallets. You can also opt for offline software wallets, such spil Electrum and MyEtherWallet, or paper wallets.

Take note that, spil Alexandr Nellson explains te this excellent Medium postbode, using an offline wallet securely is much more complicated than the online wallet practice, so you might want to keep a puny amount of crypto ter an online account for day-to-day transactions and have an offline wallet for large quantities of cryptocurrency.

Another consideration is that offline wallets can be a double-edged sword. They will protect you from gegevens breaches at major service providers but will also give you utter responsibility to protect your private keys. If you leave behind your wallet’s Speld code, lose the key or the seed, or demolish the private keys accidentally, no one will be able to help you and your bitcoins will be lost forever.

Wij might be laughing at offline wallets ter a few years. You could compare it to earlier generations stashing their money under the mattress instead of putting it ter a handelsbank. But for the ogenblik, cryptocurrencies are still a nascent field and they’re unregulated, so you’re pretty much on your own.

Hopefully, this guide will help you navigate your way through the arousing world of cryptocurrencies. Go and make your digital fortune, and stay safe.

Ben Dickson is a software engineer and the founder of TechTalks. Go after his tweets at @bendee983 and his updates on Facebook.

Ben Dickson

Ben Dickson is a software engineer and freelance tech blogger. He writes for TechCrunch, VentureBeat, the Next Web, PC Tv-programma, Huffington Postbode, and Motherboard, among others. He also runs his own blog, TechTalks.

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