Safeguard Yourself Against Hacks, Earn When the Bull Market Comes
In the world of cryptocurrency — a world brimming with life, excitement, and never-ending amounts of money to make — life can be rather meaningless. You might be ready to settle down with the pretty and rich girl of your dreams, when misfortune strikes out of nowhere in the form of a long, red line. You wake up to a nightmare — all your tokens have been stolen!
However, for cryptocurrency investors, that is acutally not the worst nightmare. The real nightmare is actually quite the opposite, of being overcomplacent and having the “I-am-safe-and-untouchable” mentality.
Cryptocurrency investors have had the fortune of trading in relatively good markets. Although the market has been through two small cycles since the height of the bull market in January 2018, most of the early digital currency investors have profited from their investments.
Cryptoassets pose limitations to ordinary investors. The infrastructure of the encrytion industry is not mature enough for most investors to deal with cryptocurencies in the same way they deal with stocks.
In addition to inherent difficulties one might face trying to conquer the crypto market, external threats like hackers pose a constant threat to investors. According to blockchain security company CipherTrace, hackers stole cryptocurrency worth $731 million (about 4.8 billion yuan) in the first half of 2018.
Abscondment of money from P2P platforms is far from a common phenomenon. Let us recount the history of cryptocurrency hacks:
• In June 2014, hackers made off with 850,000 bitcoins from the now infamous but previously world’s biggest bitcoin exchange in the world, causing bitcoin prices to plummet and the exchange to close down.
• In March 2014, US cryptocurrency exchange Poloniex lost 12.3% of their bitcoins in the hack.
• In January 2015, Bitstamp, the world’s leading cryptocurrency exchange then, was hacked and lost 19,000 bitcoins.
It was reported that hackers used Skype and emails to communicate with Bitstamp employees. After learning about the communication preferences of the employees, the hackers then went on to send malware to the employees, of whom one downloaded the files by mistake and caused the Bitstamp systrem to be compromised.
• On February 14, 2015, the domestic altcoin trading platform Biter announced that 7,170 bitcoins had been stolen from them. The hacker used the bit to fill the hot wallet from the cold wallet and steal all the bitcoin in the cold wallet.
• In May 2016, the Hong Kong cryptocurrency exchange Gatecoin suffered losses of about $2 million after getting hacked.
• In August 2016, Bitfinex was hacked and about 120,000 BTCs were stolen, amounting to losses of $75 million.
• In June 2017, Bithumb, Korea’s largest exchange, lost billions of won, and information of about 30,000 users was leaked.
• In January 2018, Coincheck, one of Japan’s largest bitcoin exchanges, was hacked. 500 million NEM coins were stolen.
• In March 2018, Binance apparently also suffered from a hack. Reports say that it was a large-scale phishing attack on user accounts. Binance has refuted the allegations.
• In July 2018, the Bancor smart contract loophole was exploited by hackers and the $23 million worth of cryptocurrencies were stolen. Coinpark exchange was also hacked during the same period.
• In July 2018, Binance was attacked by hackers. The attack was done exploiting a vulnerabilitiy in the API. It is said that 6,500 BTCs were stolen, but Binance has denied this.
News of hacks and stolen cryptocurrencies often shake the crypto world.
According to foreign media reports and some research data, a total of seven cryptocurrency exchanges around the world were hacked in 2018. In all, more than 800 million US dollars were stolen.
That is not all. Hacks are not the only issues plaguing the ecosystem.
In July, Vitalik Buterin slammed the cryptocurrency exchanges, saying “I definitely hope centralized exchanges go burn in hell as much as possible.” (This goes against the core spirit of blockchain and cryptocurrencies)
On the other hand, there is good news as well. Binance, the fastest-rising exchange, was set up in 2017 and plans to make a public chain of decentralized exchanges.
It is, however, still too early to rest on our laurels. We can’t sit still and not put up a fight.
Hot air balloon and cushion
Before this hot air balloon comes crashing to the ground, we still have time to find a “landing pad” for it.
The following is the author’s advice to investors.
Only trade on mainstream exchanges
In addition to providing sufficient trading liquidity, mainstream exchanges also have enough technical reserves to defend against hacker attacks, and have enough profits to cover the exchange’s losses.
With enough assurance that tokens are safeguarded, this will give investors the confidence in their own investmentsl.
Mitigate Risk
The saying goes, “do not put all your eggs in one basket”. Therefore, do not put all your tokens in one exchange
Wallet private keys/ Mnemonic /keystore
Private keys= Mnemonic =keystore+code=your coffers key=lose it once =money will be stolen once others get a hold of your key
Password management
When you are on multiple exchanges/wallets/tools, you will inevitably be faced with the challenge of having to manage multiple accounts. Manage all your accounts with a password manager tool like 1Password.
Theoretically, such tools will be connected to the internet. As long as any of the tools you use are connected to the internet, there will be risks. Investors are encouraged to write down their passwords on paper, but as that is a cumbersome way of managing passwords, this author suggests that passwords are recorded in an ecrypted excel file on the computer and recorded manually on paper.
Cold Wallet
Storing cryptocurrency in a professional wallet might be more secure than the imToken/bit that we use, but it also comes along with a threshold and a hardware cost.
Of course, in addition to these two types of wallets, the essential features of the wallet can also be divided into onchain full node / onchainSPV light wallet / offchain centralized server access wallet / offchain and other third-party wallets.
Wallets can be divided into web wallets, computer wallets, and mobile wallets. All of these are hot wallets. There is also the hardware wallet, or the cold wallet. The author suggests that imToken is still the most ideal.
Cold wallets are not exactly easy to use. Non-professional organizations rarely use them. After this author bought the coldlar, and practically left it unused and in the corner. One’s mobile phone can already be a wallet, and it makes for a good hardware wallet if disconnected to the internet.
Tinkey
Tinkey is an easy-to-use, multi-function wallet that is like a shield. For any product to take off, it has to be uncomplicated and easy-to-use. Only then will the product gain the public’s attention, in the same way the QR code gained public favor and went on to eradicate and take over NFC payments completely.
That’s Tinkey for you.
Token conversion within Tinkey using the API provided allows for exchanges on all centralized exchanges; fuss-free token conversion using Bancor and OX protocols enable Tinkey integrations with all decentralized exchanges.
Tinkey allows users to mine and trade tokens even while on the go. Not only will Tinkey help you monitor trade statuses and carry out trades with the help of AI-powered trading tools, users receive rewards when they use Tinkey to mine tokens.
With dual protection — protection of the account, and also of the users’ privacy, users have full ownership of personal information and need not worry about data breaches. Tinkey safeguards your transactions, and is an all-in-one mining machine, decentralized exchange, AI-powered trading tool !
Should you like to know more about Tinkey, please contact us at
