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2024 sees over $437M lost to crypto hacks, Ethereum most affected

Published 04/08/2024, 02:19 PM
© Reuters.

Cryptocurrency users lost $437 million to scams, rug pulls and hacks in the first three months of 2024, a sign that the industry remains susceptible to security risks, experts at Smart Betting Guide said in a recent report. 

The decentralized finance (Defi) sector, in particular, has been identified as the most vulnerable, with all reported incidents this year belonging to this category. Ethereum has emerged as the most targeted blockchain, suffering from alarming 33 hacking incidents on its blockchain alone.

The study outlines the Ethereum chain at the top of the list for hacks, followed by BNB Chain with 14 incidents, Arbitrum with 6, and both Solana and Bitcoin reporting 2 incidents each. 

To tackle these weak spots, the pros over at Smart Betting Guide provided some essential tips for crypto users on how to keep their assets secure. Key recommendations include avoiding cloud storage for passwords and seed phrases, which are critical for accessing crypto wallets and exchanges. 

Instead, users are encouraged to physically secure this information to prevent unauthorized access.

Moreover, opting for hardware wallets over exchange-based storage offers a more secure alternative, protecting users from online attacks and potential exchange failures. 

The paper digs into why hardware wallets beat storing your crypto on exchanges. The downfall of FTX acts as a stark warning of the risks involved in storing cryptocurrencies on exchanges, where billions were lost. The analysts describe the hardware wallets, or cold storage, as the way to go for keeping your private keys safe from online hackers and the shaky ground of exchange sites.

The guide also stresses the importance of conducting thorough research before investing in any cryptocurrency projects, cautioning against scams such as "rug pulls." Prospective investors are advised to scrutinize the credibility of project developers, the fine print of whitepapers, the measures taken to lock in liquidity, and the availability of audits by third parties. Doing so is crucial for confirming the authenticity and security of their investments, the research notes.

Further safety measures include vigilance against fake apps and exchanges, which often target unsuspecting investors. Users should rely on official sources for app downloads and remain skeptical of applications with low download counts or questionable developer credentials.

Lastly, general cybersecurity practices, such as avoiding suspicious emails, enabling two-factor authentication, and steering clear of dubious online offers, are recommended to protect not only cryptocurrency assets but also personal data.

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