How to Protect Your Cryptocurrency & Yourself From Criminals in Real Life?

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News articles that yet another investor, who earned on the growth of bitcoin, ethereum or other cryptocurrency, was robbed have been appearing more often in recent times. They are coming from all over the world: Thailand, Russia, Ukraine, Great Britain. Some security experts give several tips on how to not become a victim and protect not only your cryptocurrency, but your life from real criminals.

Despite all the shortcomings of fiat money, they have an undeniable and serious advantage over cryptocurrencies: during their long history of circulation traditional banks have developed a system of countermeasures and multi-level checks that protect fiat money from criminals.

Cryptocurrencies are anonymous. Their nature allows thiefs to steer them away in an unknown direction once they got the access. Moreover, successful tracking of these thiefs is practically impossible.

The founder of Chainalysis, a firm, which monitors crimes on blockchain, Jonathan Levin cooperates with law enforcement agencies from all over the world and helps them track stolen cryptocurrency.

He told NY Times:

“This is now becoming more pervasive and touching more law enforcement divisions that deal with organized crime and violent crime on a local level.”

Such cases are difficult to solve, because even if the transaction was tracked, it is almost impossible to link it to the real identity, especially if the person behind it complied necessary measures to hide it's identity. That is why almost every attempt to discover the owner of a cryptocurrency address hits a dead end.

For example, last month a Russian couple became a victim of robbers in Thailand, who found out about their large cryptocurrency possessions. Criminals took the couple hostage and demanded $100,000 in cryptocurrency in order to release them. An investigation of that case ended with nothing, because police failed to connect the address of criminals with real life identities.

Earlier this month, in Cancun, Mexico, a conference called Satoshi Roundtable took place, with more than 170 leaders of the crypto world taking part in it. Among many other things, an issue of the security of cryptocurrency holders was being discussed.

One of the proposals was the creation of special wallets dubbed "duress wallets." These wallets contains a little amount of cryptocurrency and they allow their owners to give a key from them to criminals. That might satisfy the interest of criminals and save the large part of the cryptocurrency.

Several security experts agreed that multisignature wallets are one of the best options to secure one's cryptocurrency. These wallets requires signatures of more that one person to conduct transactions.

Another proposed measure was the development of wallets with duress alarms. This system is similar to the one that applied in banks or houses. A victim enter the special duress code instead of the usual one, and it signals that the entry was made under duress. The signal can be sent to law enforcement or private security.

However, the simplest way to protect yourself and your cryptocurrency is modesty. Be humble, keep information about your cryptocurrency assets in secret from everyone, even from your friends. Nobody knows, what people can do when they are greedy.