A few years ago, the term cryptocurrency was only used among the tech elite and the only type available for purchase was Bitcoin. Fast forward to 2018 when the average consumer is able to invest and has a pick of over 1,800 different kinds of cryptocurrencies to choose from. It doesn’t come as much of surprise that people are eager to learn more about this new space and profitable industry.
Cryptocurrency works through distributed ledger technology, typically blockchain, which is essentially a public financial transactional database. We are entering a new era of conducting business that is centralized on this technology and will eventually touch almost every aspect of our lives. For now, the cryptocurrency trend shows no signs of slowing down, and as such, we must be aware of the implications.
There have already been hacks and major security issues with cryptocurrency all around the world. In fact, just in Q1 of 2018 cybercriminals stole $673 million in U.S. dollars via crypto hacks and scams. The most notorious of them all, the Coincheck hack, occurred this past January when cybercriminals successfully hacked into the Japanese cryptocurrency exchange’s digital wallet and made off with nearly $500 million in digital tokens.
Although these statistics are staggering, many experts still see the value in investing in cryptocurrency. In Q1 of this year, initial coin offerings (ICOs) raised $6.3 billion, which is more than what was raised during the entirety of 2017.
As you can imagine, there are several complexities associated with securing cryptocurrency transactions, ensuring end-to-end integrity and maintaining confidentiality. The learning curve required to manage and trade cryptocurrencies can be very steep, even for technically advanced individuals.
There are many steps that people can take to keep their wallets secure such as using multi-factor authentication, implementing a strong anti-virus solution and storing cryptocurrency of significant value on a physical device that isn’t connected to the internet. However, the easiest way for a cybercriminal to compromise a digital wallet is by stealing the wallet’s private key. To protect against theft, the user needs to identify where the key is being stored, who has access to it and how it is being monitored.
Users have the option to manage their own keys. However, there are organizations who eliminate the burden of securing wallets and associated cryptographic keys. For example, Saifu, a Czech Republic-based payment institution, engaged Thales to deliver high assurance protection of keys for use with cryptocurrencies.
Thales nShield hardware security modules (HSMs) provide the same levels of security to the world of cryptocurrency that banks have relied on for decades to keep money and transaction records safe from cybercriminals. By offering a robust, tamper-resistant, FIPS-compliant platform that performs encryption and digital signing along with key generation and protection, nShield HSMs ensure that Saifu and its customers meet important compliance requirements while securing assets.
Before you invest in the latest cryptocurrency to hit the market, think about how you, or the organization you entrust, will go about securing your investment. You don’t want to be the next victim to have their virtual wallet emptied.
To learn more about how Thales is helping organizations such as Saifu and Accenture enable secure transactions for their customers, visit our Thales nShield Connect and Blockchain Root of Trust pages.
*** This is a Security Bloggers Network syndicated blog from Data Security Blog | Thales e-Security authored by Cindy Provin. Read the original post at: https://blog.thalesesecurity.com/2018/06/05/cryptocurrency-are-you-ready-for-next-big-hack/