Crypto currencies are very vulnerable towards being hacked into when the customers use crypto wallets , Coss chain bridges, and hot wallets. Many loose millions of their money due to their lack of awareness of how to invest into cryptocurrency.
In this article we look into :
- Types of cryptocurrency scams and frauds
- How such frauds happen?
- How to prevent from such traps
Types of cryptocurrency scams and frauds:
- Bridge hacks – blockchain bridge is that allows connection that allows transfer of digital assets. It acts as intermediary between different transactions and exchanges. When you use cross chain bridge you are transferring currency into tokens which locks into The contract into a currency.
The tokens are stored in the reserve of bridges. Now the problem lies When these tokens are being exchanged especially in high volumes. This becomes a space for hacking to take place.
- Wallets hacks – they can be both hardware and software where private keys can be kept to access your crypto deposits and addresses on a blockchain technology.
There are two types of wallets depending on its nature, hot wallet on software wallet and cold wallet on hardware wallet.Keeping your cryptos in a custodial account is like commodating your money but not actually perceiving it and your private keys are the access to that money.
Hot wallet is more likely to be hacked as it is software-bas ed the connection of internet used can easily be penetrated by the Cyber criminals.
- Exchange hacks – tryptocurrency is a digital platform where they sell and exchange digital asset a Fiat currency.
some the currency are kept to trade and exchange.
The main target of the hackers is the custodial keys held by an exchange.
How do frauds happen?
As seen in the above scenarios of types of frauds and scams that happened in cryptocurrency. It is the amount you invest into this digital platform the cyber criminals are attracted to hack.
There are many links and websites that lead you into false disclaimer of investing huge amount of money into cryptocurrency because of the profits you’ll gain. while you should be wise to know how much of money you are investing so that your account is kept safe and secure and know amount of money would be lost even if it is hacked.
Especially regarding the wallet s the hot and cold wallets of cryptocurrencies hot wallets are much more secure and safe but many of them invest in cold wallets which becomes a victim towards being hacked.
How to avoid yourself to fall into such traps
- Research the potential outcomes and threats impose by investing in cryptocurrency.
- Protect your privates keys and keep it safe.
- Don’t click on unsual or suspicion links
- Be cautious of the http and url your using
- Contact your contract agency if there’s are claims that your account are frozen
- Don’t jailbreak smart devices.
- Investigate into jobs that allow cryptocurrencies
- While reading the contract be careful in all the grammatical mistakes and the sentences used before signing into it.
- Do not invest large amount of money at once rather invest small amount slowly slowly
- Be aware of how much profit you will be making with your amount of money you will be investing.
