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It seems that your kid is not being stubborn by wanting to play in the next apartment, everybody literally prefers to be free. Of the invaluable benefits introduced by blockchain technology is the ability to oversee your own affairs without an intermediary- no exchanges or brokerages, in simple terms, decentralization. One would not be surprised by the rate at which decentralized finance (Defi) was adopted by many, its characteristics user-control feature is a thing to yearn for as it allows users to lend, send, and invest at will.
Just as one may love to have his money saved in different currencies while everything still belongs to him, it is also possible to have different assets in a single wallet thereby enabling the owner to access decentralized apps (DApps), buy and store tokens, or even collect NFTs whenever he deems fit. A decentralized wallet gives you access to decentralized innovations in the blockchain industry without a hassle.
As interesting as the concept of decentralized wallet may sound, it has become a bitter pill for several crypto traders and investors. On different occasions, people have pointed fingers at finance companies for failing to protect their assets, forgetting that decentralized wallet is mainly user-controlled. This means that the finance company only gives you a car to drive, then it’s at your risk to park it where it can be stolen. Crypto crime is gradually becoming an inseparable section of the cybercrime ecosystem, and cases never cease to evolve. A little loophole in a crypto wallet may expose a trader or an investor to crypto criminals that would not spare a single asset.
iCloud and digital wallets
The decentralization of crypto wallet would mean that it’s no more in the custody of the finance company - the wallet is completely under your custody. Therefore, the safety of your wallet solely depends on how careful you are with it. As a matter of fact, hackers may gain access to your wallet if you are too careless with your key, and the finance company will not be liable for the loss.
In recent times, cryptojacking is on the rise and one cannot be too careful. iCloud hacking is real, which enables a remote hacker to peruse your iCloud account where your private keys may be saved. To ensure the safety of your iCloud account, you should do the following to be less vulnerable if you use iCloud:
- Endeavour to change your password at interval
- Never use a weak password
- Never use a regular security question and answers
- Use a distinct AppleID password
Following the above suggestions may not completely protect a wallet from theft. Apart from the remote theft that may be conducted from even under the Himalayas, there is also a dare need to always keep your key safe from people you don’t trust. It is good to always note that the safety of your decentralized wallet and the assets it contains are in your hands.
 Understanding the difference between an exchange platform wallet and a decentralized wallet
It is imperative that the holder of a wallet have the basic knowledge of the type of wallet he is holding. As a matter of distinction, possessing a wallet with a financial institution would mean that the private key to your wallet is held by the exchange institution, and as such the protection of the keys is a responsibility of the institution which makes the wallet a non-custodian product. Examples of such a wallet are the BRD wallet and Coinbase.com wallet. Conversely, a decentralized wallet or self-hosted wallet, or a self-custody wallet confer on its holder the sole possession of the private keys to the wallet and the protection of the keys is liable on the holder. Coinbase wallet and MetaMask are major examples of self-hosted wallets.
Going by the above, it is quite easy for a trader or investor who does not know the difference between the wallet types to err and expose his house to the night thieves. Therefore, understanding the type of wallet you are holding would help prepare for any irregularities that might want to occur in the future. Adequate knowledge of wallet type would also inform the steps to be taken if any issue should occur.
Case study of Cryptojacking
One of the frequent happenings in the crypto world is traders pointing fingers at financial institutions for exposing their wallets to theft. In fact, there are various online groups housing the victims of such ugly occurrences. However, it has been discovered that most of the traders or wallet owners are holding a self-custody wallet, which means that the private keys might have in one way been compromised.
A recent case study is a Coinbase wallet holder who took to LinkedIn to rebuke Coinbase after his wallet was assessed by cybercriminals and a series of crypto transfers were made from the wallet. Unfortunately, the victim was not the first, but one can only hope that wallet holders learn the appropriate knowledge in due time.
Conclusion
Conclusively, it is necessary for anyone intending to have a wallet with any financial or exchange institution to equip his trading arsenal with adequate weapons of knowledge on how different wallet operates and how to get the best of them.Â
Author Bio
Afees O. Oduola is a seasoned writer with more than three years of experience and certification in content marketing, SEO, and Copywriting. He has a wealth of knowledge in the blockchain industry which avails him the strength to write engaging and educative content in diverse facets of the blockchain industry. When he is not writing, he is studying or researching. Contact Afees:Â LinkedIn
Disclaimer
The views and opinions expressed in this article are solely those of the authors and do not reflect the views of Bitcoin Insider. Every investment and trading move involves risk - this is especially true for cryptocurrencies given their volatility. We strongly advise our readers to conduct their own research when making a decision.