Global crypto transactions are expected to reach $43 billion in 2023. With the rise in popularity, there has also been an increase in cybercrime and fraud in the crypto industry. Investors are advised to do their due diligence and research platform security and regulatory compliance before investing. They should also use strong passwords and enable two-factor authentication to protect their accounts from unauthorized access.
The crypto industry has witnessed a meteoric rise in popularity over the past decade, with millions worldwide investing in this asset class. Global crypto transactions will total to around $43 billion in 2023, up 24% from $34.30 billion the previous year.
However, with this rise in popularity, there has also been a corresponding surge in cybercrime and fraudulent activities in the crypto space. Investing in any asset class, including crypto, comes with inherent risks. While the crypto industry presents lucrative investment opportunities, investors must remain vigilant about security measures to safeguard their assets.
Best practices for investors
Research the platform before investing: Before investing in any crypto platform, investors should do their due diligence and thoroughly research its security measures, regulatory compliance, and reputation in the industry. They can read reviews, check for any security breaches in the past, and ensure that the platform has a track record of safeguarding its users’ assets.
Use strong passwords
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View Details »To protect their accounts from unauthorized access, investors should use strong passwords that are unique and complex. For example, they should avoid using easily guessable passwords such as their name or birth date and use a combination of upper and lower case letters, numbers, and special characters.
Enable two-factor authentication
Two-factor authentication adds an extra layer of security to an investor’s account, requiring them to provide a second form of verification, such as a code sent to their mobile device, before accessing their account. This helps prevent unauthorized access to their account, even if their password is compromised.
Use cold wallets
Investors can store their crypto assets in a cold wallet — an offline device not connected to the internet. This method is usually preferred by investors who want to buy and hold assets for a long time. This reduces the risk of their assets being stolen in a hack or cyber attack.
Avoid phishing attempts
These are common tactics used by cybercriminals to gain access to an individual’s personal information, including login credentials and other sensitive data. These phishing attempts often use cleverly designed email templates or web pages that mimic legitimate ones to trick users into sharing their information.
To avoid it, investors should be cautious of unsolicited emails, websites or mobile applications requesting personal information, such as login credentials or financial details. It is also important to always verify the legitimacy of any website, application or email that asks for sensitive information.
This can be done by double-checking the URL of the website or application, as well as the email address and sender name. It is also essential to keep all software and applications up-to-date with the latest security patches, as attackers often exploit known vulnerabilities to gain access to systems.
Best Practices for Crypto Exchanges
The number of crypto investors in India will likely surpass the 150 million-mark this year. However, recent survey findings indicate that 26% of respondents are concerned about potential crypto attacks, while 23% fear the loss of assets in security breach events. Crypto exchanges are responsible for ensuring the security of their platform and the assets of their users. Here are some best practices that should be adopted to build a more secure crypto ecosystem:
Implement multi-layered security protocols
Crypto exchanges should implement various security protocols, including firewalls, intrusion detection and prevention systems, and access controls, to protect their platform from cyber attacks and hacks.
Conduct regular security audits
They should conduct regular security audits to identify any vulnerabilities in its platform and address them promptly. They should also engage third-party security experts to test their platform’s security measures and provide recommendations for improvement.
Ensure regulatory compliance
All crypto exchanges should comply with regulatory requirements related to crypto trading in India, including KYC and AML regulations, to ensure the security of its platform and the assets of its users. It should also maintain records of all transactions on its platform to facilitate regulatory compliance.
Educate users on security best practices
Every crypto exchange should educate its users on the importance of adopting security best practices, such as using strong passwords, and enabling two-factor authentication. It should also provide resources and support to users unfamiliar with these security measures.
With the increasing adoption of crypto and the implementation of best practices for security measures, investors and exchanges can feel confident in the safety and security of their digital assets. As the industry continues to mature and evolve, we can expect to see further developments in security protocols and technologies that will make the crypto ecosystem even more secure. By working together and prioritizing security, we can build a robust crypto ecosystem that is trustworthy and reliable for all stakeholders.
(The author is CEO, ZebPay)
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of the Economic Times)
(Disclaimer: The opinions expressed in this column are that of the writer. The facts and opinions expressed here do not reflect the views of www.economictimes.com.)Friday, 12 May, 2023Experience Your Economic Times Newspaper, The Digital Way!Read Complete Print Edition »
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