How to protect yourself from crypto scams and hacks

In 2023, it is estimated around $2 billion was lost by investors to scams. Picture: Pexels

In 2023, it is estimated around $2 billion was lost by investors to scams. Picture: Pexels

Published Mar 13, 2024


It is estimated that investors lost roughly $2 billion in 2023 due to frauds, rug pulls, and hacking.

Although technology is getting more safe and dependable, and many users are becoming more aware of the methods used to steal assets, thieves can still take your cryptocurrency if you are not vigilant.

Smart Betting Guide’s experts have created a guide on the best methods to keep your cryptocurrency secure in 2024:

Do not store your password and seed phrase on the Cloud

Many individuals find that using an exchange or a crypto wallet is the easiest and most convenient way to gain access to cryptocurrency. Cryptocurrency wallets hold users’ public and private keys and provide an easy-to-use interface for managing cryptocurrency balances.

These exchanges demand you to register an account with a password, whereas wallets provide additional protection via the use of a seed phrase.

Seed phrases are a series of random words that contain the information needed to access or recover cryptocurrency from blockchains or crypto wallets. Hackers will frequently try to steal these in order to gain access to your cryptocurrency and steal it.

It is critical that these passwords and phrases be not saved on the cloud or on a device that might be compromised.

Instead, write them down or have them etched on a metal card (to prevent water damage or fire) and keep them somewhere safe on your property.

Finally, no crypto protocols or customer support personnel will ever request this information from you, so if someone does, they are attempting to steal your cryptocurrency.

Use a hardware wallet instead of an exchange

A hard wallet is the greatest option for ensuring the entire security of your cryptocurrency.

A device, such as a USB flash drive, secures a crypto user's private cryptographic keys in offline or “cold” storage, ready to be utilised online for cryptocurrency transactions whenever needed.

These are far more secure than holding cryptocurrency on an exchange; after the FTX crash, customers lost billions of dollars in cryptocurrency saved in their wallets.

Do your own research

A rug pull is a fraud in which a cryptocurrency or NFT (non-fungible token) developer hypes a project to attract investors, then abruptly shuts down or disappears, stealing investor assets.

These frauds can frequently be expertly camouflaged, making them difficult to detect.

Many may be marketed on social media, enticing investors with the promise of large profits. This is why you should conduct your own research before investing in any cryptocurrency or NFTs.

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