In 2021, crypto scammers and hackers stole over $14 billion from both large companies and small investors. Most account breaches were because of carelessness or sheer brute force attacks. While you have no way of knowing whether you’re next, you can do something to keep your account safe on-chain.
Here is a list of 5 simple ways to keep your account safe from on-chain scammers.
1) Don’t Share Your Private Key
A public key is the same as a bank account, and your private key is equivalent to your bank account or ATM pin. If you share it with people online, soon, your account will be scrapped clean. Sometimes, the private key can be stolen if it is not stored safely. Ensure your private key stays offline.
2) Never Share Your Seed Phrases
Seed phrases are a set of 12 or 13 words randomly generated upon wallet creation. A seed phrase is even more sensitive than a private key because it acts like a container, holding more than one wallet address. A seed phrase can be used to create up to 100 different and unique wallets (with different private keys).
Don’t let your seed phrases exist in the digital world because sooner or later, a malicious actor will get their hands on them, and you will lose your coins for good. You can write them down on metal, like a key holder. Writing them down on paper is risky because the paper can get lost.
3) Buy a Hardware Wallet
Hardware wallets are good for storing coins offline. They are also commonly called ‘cold storage’ because your coins are literally nowhere near the very much active world of on-chain protocols. Additionally, learn to do DeFi with a hardware wallet. This is because private keys and seed phrases never leave the hardware wallet, even when interacting with DeFi protocols online.
However, note that your coins are NOT stored on the hardware device. They exist on the public ledger (aka blockchain). The hardware device is just a key to your funds. One of the best hardware wallets to use is the Ledger Nano S. However, other wallets with more security, like the GridPlus Lattice1, have recently become more popular.
4) Shamir’s Secret Sharing
This is a way of keeping information safe by breaking it into different parts and distributing them to different people or places. If you have watched Harry Potter, you understand how Lord Voldemort broke his soul into 7 different places.
It goes without saying that you should get creative with hiding your seed phrases to ensure maximum privacy. For example, someone froze his Seed Phrases in tomato soups and stored them at the bottom of his deep freezer.
5) Secure your Accounts with 2FA
2FA is important for security. But, don’t use SMS authentication because hackers can duplicate your sim card and bypass the SMS 2FA. Make sure you transact on separate devices. Have a separate laptop just for doing transactions. Additionally, use operating systems that are designed for privacy and security. Good examples here include Qubes OS and Tails OS.
Vincent Munene is a freelance writer and a great blockchain enthusiast. Blockchain has changed his life in terms of financial freedom and in return, he likes to educate people and keep them up to date on everything blockchain. He is a Biochemist by profession and also loves to play the piano.