Common Tactics Used To Hack Cryptocurrency Exchanges

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Both amateur crypto traders and retail investors alike are starting to lose interest within this booming cryptocurrency industry due to the rather lengthy and painful decline of the market. In spite of all this, cryptocurrency as a business continues to scale and evolve, especially cryptocurrency trading platforms.

New players to the cryptocurrency marketplace like Goldman Sachs and Intercontinental exchange (ICE) who is the parent company of the New York Stock Exchange (NYSE) are planning to allow their customers to trade Bitcoin futures. ICE on the other hand will offer swap contracts to banks so that clients can obtain their cryptocurrency the day following their purchase transaction.

While it seems some of the lower skilled investors are starting to leave the market the big players are starting to enter, which represents a huge potential for cryptocurrency trading. It’s more likely than not that cyber criminals will continue to target this industry more heavily now and in the near future.

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Several security analysts have come up with a list of techniques that cyber hackers have utilized in order to hack user’s cryptocurrency trading platforms. The list below also includes some of the most common attack methods and highlights countermeasures used to combat these situations.

Phishing Emails Tactic

phishing email scam crypto attack hacker scammerThis includes a scenario where a security system message is sent from a cryptocurrency exchange letting you know that suspicious activity has been detected on your account. In response to this activity, the service send you a notification to your email along with a hyperlink and recommendation to change your password immediately in order to prevent your funds from being stolen.

Despite the simple scheme setup, many novice traders continue to fall for this as they click on the reset link and fill out several fields in order to change the old password to a new one. As you can imagine, once the old password field is completed, this information is transferred over to the hacker where he can readily access your account.

Here are a few rules that you need to follow in order to keep your accounts safe:

  • Always inspect the email address sent to you from the exchange. Official emails are always sent from the official domains. If the email address is different than the one from the actual exchange’s domain, delete and the/or report the email to the official exchange.

Example of spoofed email could be: support@binance.co

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  • Double check the URL of the password reset link within the email. The password reset page should always reside on the actual cryptocurrency exchange website. Hackers are very sneaky when it comes to choosing their spoofed domain name, which typically is one or two letters off from the original.

Example of spoofed password reset link could be: http://passwordreset.binaance.com  < notice the double aa.

  • Most cryptocurrency exchanges will not send you a password reset email in the first place, unless you’ve logged into their exchange from a different IP. Obviously, if this never occurred, then delete or report the email.

Phishing Site Tactic

Even the most savvy cryptocurrency trader will input the occasional typo when typing out their favorite cryptocurrency exchange into the address bar. Many have overlooked misspellings and security verification icons within their browser, which lead unsuspecting traders to input their username and password into a fake exchange.

In order to avoid this easy to make mistake be sure to:

  • Bookmark your cryptocurrency exchange trading platforms and only visit the bookmarked link.
  • Always look out for the “padlock symbol” within the address bar of the site you’re visiting. All cryptocurrency exchanges are secured via SSL.

Email Hacking Tactic

email hacking crypto exchange securityThe email link to your cryptocurrency exchange tends to be targeted just as much as your account itself. Once the hacker takes control of your email, he can then initiate a password reset from your cryptocurrency exchange, click the password reset link inside your email account, change your password, and then access your exchange.

This is where the two factor authentication method comes in handy. It’s the most effective protection mechanism to prevent unsuspecting attackers from accessing your account.

Teamviewer Tactic

google authenticator scam hacking crypto exchangeIf you’ve managed to install the Google Authenticator on your computers web browser, then you effectively opened yourself up to a potential attack and rendered this protective measure useless.

With TeamViewer installed, the attacker can access your computer in real time and hack into your exchange utilizing the Google authenticator embedded on your browser.

The 2FA is only effective if it’s installed on another device like your smartphone. This reduces the risk of being hacked considerably. You might find that the two factor authentication is a bit redundant, but you should keep in mind that hackers can outwit even the most successful traders.

It’s extremely crucial to follow these basic and simple guidelines which will significantly reduce the risk of you losing your valuable cryptocurrency in a potential hacking attempt.

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