The technology behind cryptocurrencies has the potential to completely change the financial system through decentralization, the elimination of intermediaries (banks), lowering the fees charged by these intermediaries, and faster international transfers. However, despite all the benefits, cryptocurrency hacks are still a problem that cannot be ignored.
Despite the fact that cryptocurrencies provide more advantages than the current banking system, digital platforms cannot always attract government security agencies to search for stolen assets. Exchange vulnerabilities are the cause of most hacks. Most often, hacks happen because the exchange uses a hot storage wallet, or an online wallet. So far in 2018, hackers have already managed to steal $781 million from crypto platforms. Even those exchangers that tried to improve their security level fell victim to their attacks.
Employees of the Bitfinex exchange, for example, decided to store private keys using cold storage, but cybercriminals were still able to hack the system and steal a huge amount of funds. Taking the necessary measures can significantly reduce the likelihood of hacking, but does not make it impossible.
Users can still become a victim of an attack on the blockchain, or a victim of scammers who have installed third-party equipment inside the device. Although such attacks have not yet occurred, Chinese chip designers have confirmed the possibility of such a hack. Representatives of Ledger conducted a vulnerability test and found that the device can be hacked and the funds stored on it can be obtained.
There are many measures that can be taken to ensure the safety of the wallet, but we still cannot do anything if the funds have already been stolen and they are needed return.
Some suggest that the solution to the problem lies in increased monitoring of centralized exchangers, tracking, freezing and confiscation of stolen assets. The recent arrest of a British hacker with the help of Delaware law enforcement is a prime example of how the government can help us in recovering stolen funds.
In addition, the development and use of decentralized exchangers can significantly reduce the risks of hacking, but not eliminate them completely.
According to cryptoinsider.com
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