Security in the Crypto Space

By Frank Jones, CISSP •  Updated: 01/01/22 •  5 min read

Introduction

From being leisure for Silicon Valley intellectuals and IT experts, cryptocurrency has become a well-liked recreation for regular people. Due to growing interest, an effort has been made to increase security on cryptocurrency platforms.

Expectation of Security

People expect enhanced security measures to keep our data safe and secure from prying eyes as our lives become increasingly online. While no online experience can ever be completely safe, high data privacy and security level may be attained.

People interested in dipping their toes into the crypto waters share these security worries. The learning curve for many newbies to crypto investment may be severe. Individuals concerned about a crypto platform’s degree of security may be hesitant to use it.

Service providers must establish a degree of trust to put consumers just starting in crypto at rest.

Blockchain Technology Security

Cybercriminals, hackers, and fraudsters know no limitations when attempting to separate a person from their money, and criminal curiosity about digital assets is no different.

Blockchain technology, which is used to record financial transactions without the intervention of a third party, is the foundation of cryptocurrency. Blockchain technology deters hackers and other criminal actors from accessing personal information or stealing digital assets.

The encrypted data put into the blockchain is permanent and immutable. Even if someone managed to change any of the information kept there, the other records would be unaffected since the network would reject a malicious transaction if over 50% of network users do not agree. As a result, blockchain technology ensures that cryptocurrencies are safe.

This security provided by the blockchain does not imply that crypto investors should ultimately depend on it and abdicate any human responsibility for safeguarding their data or digital currency. The available tools and the user must work together to ensure security and data protection.

The security holes in the blockchain were revealed by a 2018 research that Mashael Al Sabah, a cybersecurity specialist at the Qatar Computing Research Institute, co-authored. The study showed that it was possible to scan publicly accessible Bitcoin blockchain data and social media profiles to determine the real identities of cryptocurrency investors and account holders.

While blockchain technology is not without flaws, it has the potential to revolutionize data and financial data security.

Security Is a Personal Responsibility

People are more aware of the necessity of safeguarding their personal information and financial assets.

Their initial apprehension to test cryptocurrencies might be due to a lack of knowledge of the currency’s regulations. People better understand the security procedures in place to secure their money when they use traditional banking. When it comes to cryptocurrencies, the waters are a little murky.

Most typical Internet users are aware of various security mechanisms used by cryptocurrency sites, such as two-factor authentication. This familiarity may lead to a false sense of security in persons new to crypto. When it comes to entering the crypto world, personal responsibility is still required. Users can protect themselves by doing the following:

●    Don’t leave crypto on local storage – Backing up crypto on a local, private storage device like a hard drive, computer desktop, or phone leaves it vulnerable to loss or theft.

●    Passwords mustn’t be lost or forgotten – Remembering or preserving passwords may seem obvious, but consider the case of Stefan Thomas. He owned 7,000 Bitcoins (worth around $300 million at the time of writing) but lost access to his digital wealth after forgetting the password to his IronKey USB drive where he kept his Bitcoin.

●    Using safe crypto platforms – Many crypto platforms or businesses accept cryptocurrency payments or provide cryptocurrency cashback. The user must do due diligence on any platform they use for bitcoin exchanges or transactions. Cryptosystems that have been tried, tested, and confirmed to be legitimate and secure should be preferred by users.

Crypto Security Standard

Cryptocurrency platforms that wish to be regarded as significant participants in the crypto game must allay crypto investors’ fears by taking the required steps to ensure safe transactions.

Additionally, they must participate in the regulatory framework for crypto exchanges, which is still in its infancy. All bitcoin exchange platforms, software programs, and storage solutions must adhere to the Cryptocurrency Security Standard (CCSS).

In 2014, the Cryptocurrency Security Standard was created to give precise recommendations on the secure administration of cryptos. This is the industry standard for any information system that handles and manages cryptocurrency wallets as part of its business logic.

The CCSS is an open standard that focuses on storing and using crypto within an organization. The CCSS is meant to supplement rather than replace current information security procedures and standards.

The CCSS is divided into three tiers, each with a higher level of security:

● Crypto wallets can be protected with high degrees of security by an information system that has achieved Level I safety.

● A higher CCSS level II equates to more substantial levels of security and formalized rules and procedures that are followed at every step of the business process.

● Multiple actors are needed for all-critical operations in level III of the CCSS, sophisticated authentication techniques are used to assure data authenticity, and assets are spread geographically and organizationally.

These conditions, when combined, make crypto wallets more resistant to hacking.

Final Thoughts

Cryptocurrency systems necessitate the production of keys/seeds, which should be kept private and difficult to guess for anyone attempting to access crypto they don’t own.

Dual verification for crypto wallet access, references, background checks, and redundant storage of keys and other access information all contribute to keeping an investor’s cryptocurrency safe.

Security issues will undoubtedly arise as cryptocurrency investment and exchange become more popular and widely used. As more people enter the crypto field trying to establish a name for themselves, it will be up to the various cryptocurrency platforms to prioritize security and data protection.

Frank Jones, CISSP

Frank Jones has loved computers from the age of 13. Frank got his hacking career started when he downloaded a war dialing program that he used to detect dial up modems in his hometown of Chicago. Frank Jones now works as a JAVA coder and cyber security researcher.