Common Security Vulnerabilities in Cryptocurrencies

Common Security Vulnerabilities in Cryptocurrencies

Cryptocurrencies are known for their immutable smart contracts and highly secure architecture. Even though they are secured digital assets, there are many security vulnerabilities in crypto that you should know as an investor. 

These are some of the most common security vulnerabilities in cryptocurrencies that can lead to severe fund losses. If you want to secure your assets against any blockchain security threat, read this article till the very end.

dir="ltr" style="line-height:1.38;margin-top:18pt;margin-bottom:6pt"> Common Security Vulnerabilities in Cryptocurrencies

Here we are listing some of the most common security vulnerabilities in cryptocurrencies:

Phishing Attacks

Phishing attacks are the most common form of attack in the crypto industry that aims to steal the private information of the target. In a phishing attack, hackers create a duplicate of the original website and share the links with the target. These attacks are planted in a way that the user does not get time to check the URL of the webpage where it is entering the information. 

Once the user enters the private information on the phishing website, the attacks get it instantly in their systems. Attackers are most interested in stealing passwords, passcodes, private keys, and OTPs to gain access to the private wallet of the target. 

Rug-Pull Scams

Rug-pull scams have become more prevalent after crypto gained enough popularity among the masses. Rug-pull scams are those projects that lure investors by offering them extraordinary returns in a very small-time frame and eventually run away with all the investor’s money. Even though rug pulls are a very common kind of scam all over the world, they became quite common in the world of crypto.

Crypto transactions are transparent but users are pseudonymous and that gives leverage to the scammers in hiding their identity. 

Leaked Private Keys

Losing the private keys could be the worst dream of any crypto investor. Compromised or lost private keys mean that your crypto funds are not safe anymore. Private keys are the only way you can gain access to your crypto funds and claim ownership of your assets on the blockchain. If your private keys are compromised, there is a high chance that your funds would be transferred to a different wallet by the attacker. 

In most cases, funds are moved instantly when the private keys of the users are compromised. There are different ways that can become the reasons for leaked private keys but here we are listing some of the most common ones:

• Phishing Attack

• Hot Wallet Hack
• Exchange Hacked

• Misplaced Keys

• Leaked from your personal device

• Sharing it with someone
  

These are the most common ways a private key is compromised and as an active crypto investor, you should keep these reasons in mind to secure yourself. 

Platform Exploits

This is the most underrated threat that is faced by all crypto users equally. While operating in the world of blockchain and crypto, we tend to use multiple services that are open-source. Even though this is great in decentralizing the crypto applications, it gives adequate exposure to the bad actors in the space as well. Crypto platforms are always under threat of a technical exploit that can potentially be used to steal customers’ private data. 

Even though most of the applications based on the blockchain are highly secure, exploits are possible even in smart contracts. To reduce the risk of compromising your private information - make sure that you are disconnecting your crypto wallet from all the DApps when not in use.

Conclusion

Cryptocurrencies are getting more popular with time and new investors are entering the space every day. The mass flow of liquidity across the blockchain bridges billions stored in a crypto wallet, all are vulnerable to security threats if common security practices are not followed. 

In the next part of this series, we will be sharing the methods using which you can significantly reduce the risk of being vulnerable to these threats. Hope this article will make you aware of the common threats that users commonly ignore.