Scams relating to cryptocurrency and investing are becoming increasingly common, and their scope and sophistication are growing. Your Ethereum can be stolen if proper measures aren't taken. There are two ways malicious actors can obtain digital assets – stealing them or using a scheme to convince you to hand them over. If you've invested in Ethereum or any other cryptocurrency, your funds become a target for thieves, and it's impossible to recover the lost tokens. The best approach is to make sure that your Ethereum never gets stolen. Here's a security checklist of everything you need to know to keep your coins safe.
Store Your Tokens in A Cold Wallet
At present, there are countless crypto exchanges offering varying levels of security, and it's up to you to find the one that meets your needs, provides the desired Ethereum price, and meets your security expectations. While exchange-generated wallets offer a reliable degree of security, it's best to store your tokens in a cold wallet, in other words, to keep your ETH offline. A cold wallet makes hacking much more difficult, but there's the risk of losing your holdings as this type of storage doesn't offer any kind of backup. More exactly, if you misplace your wallet, you can say goodbye to your investments.
There are two types of cold wallets, namely paper and hardware. A paper wallet is basically a piece of paper with your private and public keys printed out, which can be stored in a secure location. A paper wallet for Ethereum would just have the QR code printed, and you can scan the code for any transactions associated with the wallet. You can laminate the paper so that it lasts longer. A hardware wallet looks like a USB device, and it's immune to malicious software unless the device is defective. If you don't have your laptop around, you can still trade from your smartphone.
Protect Your Private Key and Seed Phase
The private key gives you full control over all funds associated with the Ethereum corresponding device. Because the tokens are decentralized, keeping the private key safe is of the essence, so don't share it with anyone, don't store the key in the cloud, and back it up. Otherwise, your funds will forever remain inaccessible. Use a physical device like a USB token, a smart card, or a hardware storage module. You can make an exception with trusted parties like family and close friends, but don't share your private key with strangers. Your seed phase should also be stored in a secure location, accessible only by you.
Use A VPN for Crypto Transactions
As you might already know, Ethereum is pseudo-anonymous, meaning that it's easy to track financial activity via KYC/AML verification. Since all transactions are stored on the distributed ledger, you leave a digital footprint at cryptocurrency exchanges, which can be used to track you back. Certainly, your IP address can lead back to you, but there are many ways to hide it. For example, you can use a VPN to encrypt your Internet connection, which is useful when trading ETH as you can maintain anonymity. Since the VPN secures your transaction, you can eliminate the risks of hacking attacks and data theft.
If you don't want your Internet Service Provider to know everything you do online, use a VPN. It hides your real IP address, so you're in complete control over your identity. Attention must be paid to the fact that the market is growing, so it has attracted lots of new vendors, not all of which have experience. Security is your number one priority, so select a VPN that ensures a safe connection with minimal risk. AES-256 should be the encryption standard used by the VPN as it's the most advanced form of cipher. Equally important is to look for a VPN that incorporates open-source software.
Secure Your Personal Devices
If your personal devices (smartphone, tablet, computer, etc.) aren't protected, thieves and other fraudsters may get access and steal your funds. Make sure your devices are configured to automatically apply updates for apps and operating systems because the new versions include security patches. Installing strong antivirus and firewall protections is paramount. There are tools that Android or iOS use to keep your phone safe, but they're not enough on their own, so use an antivirus to remove viruses and other kinds of malicious software. The firewalls will prevent attackers from getting access to your system in the first place.
Manually Update Wallet Software
So, you have a suitable wallet in place for transacting and storing Ethereum. As you can imagine, it's important to keep your wallet updated to the latest version. Not only can you access the new features, but you also enjoy improved security. It's best to manually update the wallet software, so stop automatic updates. You don't want the latest software version right away because it takes a week or two for the bugs to get worked out. Future releases are tested just around the area of change, and that's where the bugs come in. The software doesn't run in isolation, so if your device has peculiar configurations, you can get bugs.
Final Thoughts
When you begin to invest in Ethereum, it's crucial to maintain a security checklist and employ due diligence. Hackers and organized crime groups have become more sophisticated, and crypto crime can occur anywhere where there's an Internet connection. There are many ways that malicious actors can profit off their victims, such as ransomware, selling or abusing stolen data, and so on. The potential of Ethereum to enable cybercrime is hard, if not impossible, to assess, yet there are attempts taking place. To avoid disastrous consequences, it's better to be safe than sorry.
All in all, don't be discouraged because most attacks can be prevented. If your funds have been stolen, there's nothing you can do to recover them. Still, the mistake is a chance to learn. Understand what happened, make a new wallet, and, last but not least, read as much as you can about crypto security. Show threat actors you're a force to be reckoned with.