Digital security in a crypto-world

News broke just yesterday of a large scale theft of newly minted cryptocurrency, bitcoin gold. The value of the anonymous heist has been placed at over $3.3 million. A website was created to trap unsuspecting users by piggybacking off the official bitcoin gold site. This website then asked visitors for their wallet numbers and private keys. From there it was a matter of simply transferring the digital currency to an unknown destination.

In addition to including an unassuming link to the malicious website, the perpetrator also managed to receive endorsement from the official Twitter account of bitcoin gold!

It’s fair to say that cryptocurrencies aren’t as safe as we’d like to think they are.

The anonymous marketplace

The bitcoin marketplace is known to keep its secrets by employing blockchain technology. This allows for confidential transactions. With bitcoins ‘mined’ every time a transaction is validated, the system basically encourages more people to partake.

Staying protected in an unknown digital world

Cryptocurrency is stored in wallets that are provided by third parties, and each comes with a unique private key and a public key. Typically, wallets are only used once as every successful transaction requires the private key to be revealed.

For the uninitiated, bitcoin and bitcoin gold can seem like excellent opportunities for investment. It is one of the less riskier options for newbie investors at the moment. However, simply purchasing the currency doesn’t ensure it’s safety.

Some basic tips to protect yourself include:

  1. Purchasing wallets and bitcoins from trusted sources
  2. Safeguarding your private key
  3. Employing third party agents/escrow accounts when making transactions
  4. Taking a backup of your wallet
  5. Using simple encryption tools to change your private key regularly
  6. Storing your bitcoins in multiple wallets
  7. Investing in robust antivirus to improve security on your systems

The final word

While cryptocurrencies can be exciting, it is important for you to do your homework before purchasing. The returns can be high, but if careless, the results can be catastrophic.