How do crypto hot wallets get hacked? — SECURITY SERIES

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1 year ago
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One of the reasons a lot of people have been hesitant to invest in cryptocurrency is because of the security risks. Hackers can steal cryptocurrency in a variety of ways, from stealing or guessing your password to hacking an exchange platform, to luring information from you in phishing attempts, and many more. So it is important to have an idea about this when you're dealing in the Crypto world.

  1. Phishing Attacks

  • Phishing attacks are a frequent way for hackers to steal information

  • Attackers use cloned websites that strikingly resemble genuine cryptocurrency exchanges to trick their victims

  • Additionally, the schemes’ domain names are chosen specifically to be misleading. For instance, use rather than

2. Compromising SMS verification

  • Typically, this kind of assault targets individuals who are engaged in cryptocurrency-related activities

  • The major objective of this scenario is to intercept these SMS verification messages since mobile devices are frequently used to enable 2FA

  • They can be taken via a variety of techniques, including wiretapping, SIM-card cloning, or vhishing (sometimes called voice phishing), to either validate fraudulent transactions or “recover” access to the cryptocurrency wallet

3. Malware

  • Hackers are attacking well-known operating systems like Windows and macOS with a variety of malware variants

  • Some of the viruses are designed to recognize copied bitcoin addresses and replace them with hacker-owned wallet addresses

  • Successful exchanges typically result in the delivery of cryptocurrency to unanticipated addresses under the control of hackers

  • The primary method used by early versions of the malware to infect computers was to deceive victims into installing dangerous software

  • Targets are now, however, occasionally steered to websites that contain malware

4. Mobile applications

  • Unfortunately, not all mobile applications for crypto trading are secure because of poor design and security backdoors, making them susceptible to the majority of cyberattacks because API keys and clients’ sensitive information are kept in databases without encryption

  • Hacking mobile applications can have a variety of purposes, from brute-force attacks to PIN guessing or carrying out illicit operations on your behalf to manipulating market holdings by raising or lowering positions for certain cryptocurrencies

5. Stealing secret keys

  • You require a set of keys — public and private — in order to carry out any financial transactions with cryptocurrencies

  • The private one serves as a digital signature that allows a user to carry out all transactions and is only visible to its bearer

  • A user cannot access their assets if they lose the private key, which is kept in the crypto wallet

  • The money will be gone forever if someone obtains your private key since they can quickly transfer all the funds to their wallets due to the near-impossibility of tracking cryptocurrency transactions

  • Because of this, hackers employ every method at their disposal, starting with browser add-ons, spell-checking software, and common system flaws

  • They find success with hot wallets, which are online and frequently have a centralized operating system





None of these articles constitutes financial advice. Articles are highly summarised to make it easy for the reader and save your time, so please DYOR further before putting your hard-earned money into any product mentioned.

Please note that the tech industry evolves rapidly and the info in this article is correct at the time of publishing. As Heraclitus said, “Change is the only constant,” so if anything sounds old or off, please holler on the socials or comment here so everyone stays peeled.

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Avatar for magnolius
1 year ago