Cryptographic security: protect your coins and NFTs against theft

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With plummeting crypto pricecrypto companies lay off thousands of workers and coins which are considered “stable” lose all its valuesecuring your remaining wallet is more important than ever.

The current crypto crash is not the only way people are losing their money. There was one increase in the number of scams that give thieves access to your crypto accounts and assets. Most recently in May, Seth Green had multiple NFTs stolen worth over $300,000after the actor connected his crypto wallet to a fraudulent website claiming to be a credible NFT project.

Protecting your crypto means taking some of the same steps you would use to protect your other digital accounts, such as create and use strong passwords. However, crypto accounts have unique features such as starting sentences that require additional security. Additionally, the crypto industry remains lack of regulatory framework necessary for the recovery of your crypto assets if they are stolen.

In this story, we’ll cover several ways to protect your cryptocurrency and NFTs from theft and explain why it’s worth taking the time to properly secure your digital assets from theft. To learn more about crypto, check out five questions every investor should ask about cryptocurrency and the latest details on wild bitcoin price swings.

Always follow these two basic password security rules

One of the easiest ways to protect your digital assets is to strong passwords. Ideally, you want your passwords to be at least eight characters and include uppercase letters, numbers, and other random special characters. If you can make your password longer, however, you should, because the longer the password, the harder it is to crack, in theory.

If you’re worried about remembering all your long, complicated, and unique passwords, consider using a password manager, making it simple and secure to store and use your passwords from one place. We recommend choosing a password manager with encrypted storage and two-factor authentication for more security.

Also, when creating an account, never repeat your passwords. If one of your accounts is compromised, your others will also be at risk.

Secure Password

A strong password is essential to ensure the security of your digital assets.

James Martin/CNET

Use a hardware crypto wallet for your most valuable assets

Your crypto wallet serves as a gateway to your crypto assets. “Hot” wallets such as software or mobile apps work online, while “cold” wallets are hardware devices that work offline. Crypto wallets don’t contain the actual coins or tokens – they store the private keys that prove you own your crypto assets and allow you to buy, sell, or trade on blockchains.

Whenever you buy cryptocurrency or NFTs, they have to be stored somewhere. Most people keep their assets in a digital wallet or a marketplace, like Coinbase or MetaMask, because they’re free and easy to use, but for your most valuable holdings, you might want to consider a physical wallet.

A hardware, or cold, wallet allows you to store cryptocurrency and NFTs on a physical disk, which you can connect to a computer to access. Hardware wallets are generally more difficult to hack, so they are a preferred option when storing digital assets of particularly high value.

Handmade material wallet

The Trezor One hardware wallet ($48.49) works with bitcoin, ethereum, litecoin, and a variety of other cryptocurrencies.

Trezor

Here is more about the different types of crypto wallets.

Keep your crypto wallet seed phrase safe and offline

In addition to a password, most crypto wallets use a seed phrase for added security. This seed phrase acts as a master password and is created each time you set up a new wallet. A seed phrase is 12 or 24 words that you can use to log into your account on other devices, or recover your account if you forget your password.

While this seed phrase provides additional security, it also comes with risks – anyone who learns your seed phrase could potentially steal all the crypto assets stored in your wallet. Although you may be tempted to store your seed phrase somewhere online, writing it down – offline – is crucial to prevent anyone from accessing it.

Once you’ve written your seed phrase, store it in a safe or vault, so no one else has easy access to it. Hardware tools that specialize in seed phrases, such as Cryptosteel and Crypt Keeper, can safely store your 12 or 24 words in a fire- and flood-protected portable system.

If your seed phrase is lost or stolen, but you still know your password, immediately log into your wallet and generate a brand new seed phrase.

Seed Phrase Generator

This is an example of a randomly generated 24-word seed sentence.

Nelson Aguilar/CNET

Beware of Direct Message Scams on Discord

Discord is one of the unofficial home of the crypto and NFT communities. This is where many crypto enthusiasts go to discuss upcoming NFT projects, cryptocurrency prices, real life events, and even personal life. Fans of NFT projects use Discord to form communities – but that’s also where hackers and thieves go to compromise accounts.

Here’s how it works: A hacker can message you directly, claiming to be part of a project you’re following and interested in. The DM looks official and generally claims that you can create a hard-to-get NFT for a relatively cheap price. price, and includes a link to follow. But when you click on the link, connect your wallet and attempt to buy the NFT, your wallet is emptied of all your NFTs and crypto. And there’s really no way to get it all back.

The most important research you can do to avoid falling into the trap of a fake NFT website is to use verified channels to find the right website when trying to create or purchase a newly created NFT. Even if you receive a link from what appears to be a credible source, use several online sources like Google, Twitter, and Opensea to verify that you have the correct URL for the project.

An even easier way to avoid falling for a scam is to disable DMs on Discord. On your mobile device, launch the Discord app, press your profile picture bottom right, go to Privacy and Securityand disable Allow direct messages from server members. You will no longer receive direct messages on Discord.

Direct messaging screen for Discord

Discord is where people go to discuss cryptocurrency and NFTs, as well as to prey on potential victims.

Discord

Don’t fall for Twitter support scams

Like Discord, Twitter is a hunting ground for hackers looking to scam unsuspecting victims into giving away their assets.

On Twitter, whenever someone mentions “stolen account”, “lost password” or even “MetaMask”, an army of hackers can respond, offering to help recover stolen assets or restore access to accounts. Hackers can then request your seed phrase via DM and use it to steal your crypto or NFTs.

If you need help, go directly to the official customer service site on Twitter. Never give your seed phrase to anyone, even if an account is verified – sometimes hackers get access to verified accounts. And never share your screen.

Elon Musk's Twitter account on a cellphone, in front of a Twitter logo

Even Elon Musk can’t stop these Twitter scammers.

James Martin/CNET

To learn more about the security of cryptocurrencies, discover whether it is possible to insure bitcoin and how the Securities and Exchange Commission is cracking down on crypto fraud.

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