The Wide, Wide World of Cryptocurrency
In the first installment of our cryptocurrency security series, we discussed everything from coins to wallets to blockchain bridges to million-dollar heists.
Crypto is dominating the fintech space, and it seems like the COVID-19 pandemic has only fueled its skyrocketing popularity with at-home retail investors clamoring for anything with the word “coin” on the end.
So, you may be familiar (or even be an investor), but we’ll give you a short background on cryptocurrency anyway.
Cryptocurrency is a digital medium of exchange that allows users to exchange coins, products, and more on a virtual ledger called the blockchain.
The possibilities unlocked by cryptocurrency and the blockchain are virtually (no pun intended) endless. We’ve even started to see an example of that: you can now buy a Tesla with Dogecoin.
However, the simultaneously biggest benefit and detriment of crypto is the deregulated aspect.
When not overseen by any central authority, transactions are performed person-to-person and result in little to no transaction fees… but it leaves your crypto, as well as the blockchain, susceptible to hacking and ransomware attacks–and that’s where we begin to run into some issues.
Crypto Current Events
We’ve already covered some recent events surrounding crypto: billions lost in locked crypto wallets, the recent hack of the Horizon blockchain bridge, and hardware wallet break-ins.
Just when you thought it couldn’t get worse, enter the Lazarus group, North Korea’s infamous state-sponsored hacking collective.
We mentioned the Horizon blockchain bridge attack in which $100 million in crypto was stolen, but new information has now come to light that pins the blame on the Lazarus group.
According to research by blockchain analysts, the North Korean hacking group is likely behind the attack, and they’ve been converting the stolen assets into Ether (another type of cryptocurrency like Bitcoin) through Tornado Cash to cover their tracks.
Just when crypto started to make sense, we throw another actor into the mix that obscures our understanding and makes us revisit that integral question: who’s providing for cryptocurrency security?
A Little More About Crypto Wallets
People’s main form of cryptocurrency security comes not from regulation or a government agency but from their own “crypto wallets.”
And what is a crypto wallet again?
Well, a crypto wallet is basically any device or program designed to protect the keys that allow you to access your coins.
However, if anything happens–you lose access to your wallet, you misplace the physical drive, you forget your password, etc.–your crypto is gone and unrecoverable (and that’s where data backup came in).
Even the executives at Ledger and Trezor, who make crypto wallet hardware, recommend some sort of data backup solution to protect the recovery phrase that allows you access into your wallet.
While it may seem absurd that someone could lose thousands or millions of dollars of precious cryptocurrency because of their choice of wallet or recovery phrase, it happens more often than you think!
How Do You Lose Crypto?
Do you ever get delayed leaving your house because you can’t find your car keys, or do you sit your phone somewhere and forget where it is?
The same thing happens with cryptocurrency!
You can easily lose your hardware wallet, get locked out after too many password attempts, or lose it to a malicious hacker (to mention only a few ways).
For such a new and innovative technological breakthrough for the world of finance, you would think someone would’ve also developed a complementary product that secures your cryptocurrency and relies on something better than a password.
What Happens If I Lose My Wallet?
The Atlantic Blockchain Company phrased it perfectly when they said that losing access to your wallet and crypto is like “a sinking ship full of gold.”
Losing your crypto keys is the point of no return–without access to the wallet and keys, you are essentially locked out of the blockchain.
You may ask why someone like Bitcoin, Coinbase, or Ledger can’t just help you break back in and recover your keys, but in reality, it’s a no-win situation.
If they were to help you, you’d lose the deregulated/DeFi aspect that makes it so appealing.
Data Recovery for a Secure Crypto Wallet
Even with the most secure crypto wallet, when you lose that wallet, there’s no going back.
So what should you do now to employ cryptocurrency security and protect your crypto before it’s too late?
The answer: data recovery.
When you lose the keys to access your crypto or misplace your crypto wallet, your keys, passwords, and all your other data is there and recoverable.
Not just with crypto, but with all the financial and personal data you want to protect, data recovery ensures that when you “lose” one of your digital assets, it’s never really lost.
It’s there, in the cloud, fully available for you to reclaim.
Fully Recoverable Crypto with UnisonBDR
Cryptocurrency is a complicated technology that requires a simple solution for backup and recovery… and Central Data Storage is your provider of solutions for all things data backup and data recovery.
Our data recovery solution, UnisonBDR, automates backups of all your crypto keys, NFTs, and the like, and it saves every version of your files for easy recovery.
When disaster inevitably strikes, UnisonBDR gets you back up and trading within 2 hours with full data restoration in just 24 hours!
In a finance world where it seems like there are new innovations popping up on the blockchain everyday, you need a simple solution to protect your crypto.
With UnisonBDR, there’s no risk of data loss, and there’s a friendly team behind the solution, willing to help you access your account and answer any of your other questions.
Implement data recovery for your cryptocurrency and its security before it’s too late! Central Data Storage would love to help. Get started with UnisonBDR, or chat with our team!