6 Tips To Keep Your Digital Wallet Safe
The rapid growth of technology in the past few decades has truly transformed society into an online one. In November 2021, Malaysia saw 233.6 million electronic money (e-money) transactions worth RM5 billion in November last year, according to data provided by Bank Negara Malaysia (BNM).
As our banking and financial institutions evolved, so too did the scammers and hackers who seek to take advantage of our online presence. Because of this, digital security has never been more important. So much of our financial transactions are being done online today, be it via online bank accounts, e-wallets, mobile wallets, and now, crypto wallets.
In the past, when someone mentions a wallet, it usually means a physical object where you can keep your identification, driving license, various credit cards and of course, your cash. Just as your physical wallet can be stolen by a pickpocket, your digital wallet can also be hacked by online scammers through your mobile phone, laptop or any device that is connected online.
As such, you will need to take as many measures as possible to ensure that your wallet and accounts remain secure, and your private keys inaccessible to anybody who may wish to exploit it.
Strengthen email security
One of the most common ways to end up getting scammed is via a phishing email. Usually, people will be tricked and lured to a fake website as they are browning the internet where they may end up entering a password. These emails and sites can be very convincing, even to savvy internet users. This is especially true for scammers who are posing as official service providers that are well known. Here are a few quick tips on how to spot a phishing email:
- The mail was sent from a public email domain. Phishing attacks will often be using easily obtainable email addresses like those that come from Gmail or Outlook.
- The domain name is misspelt. Hackers may try to trick you with the use of similar looking domain names that mimic legitimate ones. For example, you might see something from “email@example.com” instead of the official alert email that comes from “firstname.lastname@example.org”.
- Poorly written emails. Legitimate emails are usually handcrafted to be as accurate and grammatically correct as possible.
- The email contains suspicious links or attachments.
- The message contains a sense of urgency. Scammers want you to believe that there is no time to double check the legitimacy of their email.
Be doubly cautious when emails concern your finances, and make sure that financial service providers are who they say they are before you give away any personal information.
Clean your devices
By clean, we mean free of malware and other harmful programs. This is absolutely essential if you have digital currency.
Don’t install any software that you know is a bit questionable on your devices, such as torrent and pirating software or anything that enables practices which could be legally questionable. Even legitimate software can sometimes be harmful as they may occasionally come bundled with additional applications or plug-ins.
Try to opt-out of any additional bundled software when installing new apps. If you’re in any doubt as to whether software is secure, don’t install it on the same device you use for your finances.
Take advantage of two-factor authentication
Despite being the bare minimum for digital security, passwords can actually be considered part of the problem. For one, people tend to create easily hackable passwords that can be cracked without too much effort. Either that, or they forget their passwords and use the same one for multiple sites and accounts.
This is why it is a good idea to utilise two-factor authentication (2FA) as much as possible. This creates another layer of security to fall back on, which should hopefully keep hackers out if they gain access to your password. In addition, installing an authenticator app which produces a time-limited code unique to you is the standard among reputable wallet service providers (WSPs).
Stay vigilant in public
Public wifi is both convenient and handy in a pinch, but you should avoid connecting devices containing sensitive information as much as possible. At the very least, the provider will be able to notice the kind of data you are sending and receiving over the network. The worst case scenario is that malicious software could be used to steal your information.
If you absolutely have to use public wifi, you should at the very least utilise a VPN to keep your data encrypted. Additionally, while it may be obvious, it bears worth repeating: do not use wifi that you do not own to access your wallets.
Don’t store tokens on exchanges
Exchanges are the marketplaces where you can buy and sell cryptocurrencies. As such, they are an obvious target for hackers, and attacks are fairly common. You are far better off using a reputable Wallet Service Provider that offers cold storage. Cold storage is an offline wallet used for storing bitcoins or other cryptocurrency. With cold storage, the digital wallet is stored on a platform that is not connected to the internet. This helps to secure the wallet from unsanctioned access. This goes doubly so for those who are seeking to use cryptocurrencies as an investment. Cold storage would be much more preferable if you are not looking to trade that often.
Securing your private key
On creation of your cryptocurrency wallet, you are provided with a unique key to download. A private key is a unique randomly generated 256-bit long alphanumeric password that enables you to transfer your crypto. As such, it is imperative that you take all the precautions possible to protect it. Don’t store the key using things such as:
- Note-taking apps
- Cloud storage, such as Google Drive
- In a file on your computer
The randomly generated key can be rather complex, and it is highly unlikely that you will be able to remember all of the keycard yourself. One of the best ways you can use to store the key is by downloading the key to an encrypted USB drive and keeping it somewhere secure. An encrypted USB stick that is not kept plugged in is one way you could keep a digital copy of the key as backup. USB sticks can be easily misplaced or dropped somewhere, so you will need to make sure that this digital version is not your only copy of the keycard.
It has become increasingly clear that as technology advances, the need for even greater digital security also rises. As it becomes more and more worthwhile for malicious hackers to gain access to your personal digital wallets, it has become imperative to create a highly secure and efficient digital payments ecosystem.
The above steps can not only help to reduce the underlying risks of owning and storing cryptocurrencies, but also save you from potential data and monetary losses.