In history, theft has been a significant problem, but the new age brings fresh challenges. Digital currencies might have several advantages than cash; it comes with peculiar risks, like hacking and online fraud. Other cryptocurrencies like Bitcoin can solve some of the issues, but then a user should still be careful.
Security of Bitcoin
Bitcoin already has several security benefits over traditional currency. Bitcoin uses push transactions where the user hands the payment himself, without a mediator or third party.
Through pull transactions, hackers can sham to be you and get your bank or credit card company to transfer money for them. However, with a push transaction, they need access to the money itself, not just your personal information. But that’s not where Bitcoin’s safety features end.
Bitcoin always leveraged the blockchain, that it is decentralized and immutable. Some scholars are suggesting to use Bitcoin to prevent identity theft for the system is so secure. But there are some precautions one should take.
Latest Bitcoin Fraud Cases
It can be more difficult to commit fraud with Bitcoin, but it is not impossible. If someone steals an identity, they may be able to access a Bitcoin wallet. There are 15 million cases of identity theft each year, so it’s not a small risk.
In 2018, a fraudster stole $5 million worth of Cryptocurrency via SIM swapping scheme. This involved tricking phone companies into transferring numbers to a SIM card that a user controls. By stealing phone numbers, one can access different accounts, most of the time, including Bitcoin wallets.
How can accepting Cryptocurrency can save Business Money
Thru Bitcoin, the transactions are secure, but the wallet may still be vulnerable. To have the security advantages of Bitcoin, one must make sure that his wallet is safe.
Protecting Private Security Keys
The fastest way into a wallet is with private security keys. If one wants to keep a Bitcoin secure, he will have to accept safe security key management. The first step is to save offline backups of all your keys.
One should take steps to make sure these offline backups are safe. The most direct way to do this is to store them on the computer, like in a flash drive or physical document. In doing this, one must be careful to protect these storage solutions, too, not letting them slip into the wrong hands.
Management of Crypto Account
One must use two-factor authentication for all of their email addresses. A consumer may consider using email security software as a second layer of defense as well. It is also a good idea to set up two-factor authentication on any service available.
A user must also not use the same password for more than one account; a password manager can be used if a consumer is having trouble remembering strong passwords.
Other Standard Security Practices
It is good always to double-check to make sure a company or product is legitimate before paying them.
It is a safe practice to use more than one Bitcoin. With this, if hackers may get into one, they won’t access all the money. A VPN can also be used to access the wallet and update the operating system regularly.