The year that passed has been very negative for users and for cryptocurrency enthusiasts not only because of the bear market but also due to several attacks to cryptocurrency exchanges. In a recent article published by CoinDesk, Eric Larcheveque talks about this issue and how hardware wallets are helping to solve this issue. Larcheveque is the CEO of Ledger, one of the most important hardware wallet manufacturers all over the world.
According to Mr. Larcheveque, exchanges suffer from system risk. That means that they have to secure billions of dollars in deposits that are a perfect target for hackers. In general, these crypto exchanges are not cybersecurity firms and several of them do not even pay to one of these companies to perform security improvements.
Another issue that Larcheveque marked is the fact that hackers are becoming more sophisticated. As virtual currencies become more sophisticated and exchanges and other platforms improve their security, hackers follow the trend. Some of the hackers that attacked these crypto platforms have dedicated large amounts of time to discover how to break into their systems.
Furthermore, he says that each day $2.7 million is stolen from crypto exchanges. This amount grew 13 times compared to 2017. This represents $1,860 stolen per minute to exchanges around the world.
At the same time, the need for security has been also growing. Now, it is necessary to improve security issues and features more than never before.
Larcheveque has a few solutions and basic security principles that crypto users should follow to avoid being hacked or victim of an attack. Exchanges are usually prone to attacks because they have to keep hot wallets opened at all times, meaning that there is a constant risk for users that hold their funds on exchanges.
Users should always have control of their wallets and virtual currencies. The best way to do it is using a hardware wallet. In the crypto space, there is a phrase that says that users are their own bank, which is very important and it is related to high responsibilities as well.
The main rules that users must follow, according to Larcheveque are:
- Avoid cryptocurrency exchanges for storing funds for a long period of time
- Use two-factor authentication
- If you use a hardware wallet use a PIN that is secure and easy to remember
- Always keep your recovery sheet well secured
- Trust what you are able to see on the screen of your hardware wallet
- Assume software on computers and smartphones are always compromised
One of the most popular hardware wallets in the market is the one created by Ledger, which is known as Ledger Nano S. It would allow users to have their virtual currencies protected at all times without risks of having their devices hacked. Another popular hardware wallet is Trezor.