Is Cryptocurrency Safe? - Doctor Tech


25 June 2018

Is Cryptocurrency Safe?

Cryptocurrency has erupted thousands of discussions and millions of conflicting views all over the world, about its safety and relevance in the exchange market. Cryptocurrency is something that has grabbed the eyeballs of numerous 'Money Gurus','Investors' and 'Hackers' too.

But more than establishing its relevance, Cryptos have ended up confusing more human minds over it than ever before.

Cryptocurrency is becoming an extremely popular means of digital currency mainly due to two reasons;


  • Peer-to-Peer Electronic Cash System that is Decentralized
  • Fast and Encrypted Digital Currency for Transaction
So this man named 'Satoshi Nakamoto' well known as the unknown inventor of "Bitcoin" is believed to invent this concept of Peer-to-Peer Network of Electronic Cash System. Satoshi invented a "Decentralized" digital cash system.

What is Cryptocurrency?

A Cryptocurrency is a Digital Currency or a Virtual Currency that is used as a medium of exchange. The currency got its name "Crypto" from the method involved in its transaction and creation. 
Cryptocurrency works on a technology of Cryptography that makes the transactions secure and administers the creation of new units of a particular cryptocurrency.

All-in-all cryptocurrency is a limited addition to a database that cannot be changed or altered without working out a specific set of conditions and regulations which restricts the piracy of the currency.

As mentioned earlier, cryptocurrency is completely decentralized i.e. no servers are involved during the transaction and there no central body monitoring the exchange. Which also means if something goes wrong or you get bluffed by a fraud there is no one to help you out.

As briefed earlier, Cryptocurrency is the entry of tokens in decentralized consensus databases that is secured by strong cryptography. This clearly means Cryptocurrencies are not secured or taken care by Human or a trust/ organization but by Math.

You will love to read this: What is Artificial Intelligence (AI) and What are its Applications in Modern World?

Some of the popular Cryptocurrencies available in the market for purchase are; Bitcoin, Ethereum, Litecoin, Ripple, Bitcoin Cash, Dash, NEO, NEM, Monero, IOTA, Ethereum Classic, Qtum, Augur, Waves etc.

This is what gives rise to the most important question; "Is Cryptocurrency Safe?"

Let's find out in the coming section...

Cryptocurrency 2018

Cryptocurrency is a digital money that is created from code. And "Code can be hacked or altered".

  • Since Crypto is guarded against political influence i.e. this digital currency is free from governmental oversight because of its peer-to-peer operation, there is no legal or authorized body keeping a check on your digital currency and thereafter protecting it. This is another major concern that might concern investors.
  • The volatility of digital currencies is what gives sleepless nights to myriad investors. Talking about the oldest and most talked about cryptocurrency "Bitcoin" which was trading at $18000 at one time has slipped to less $6300 currently. Though it's not that a big thing to worry about as markets are significantly positive about the future of this cryptocurrency. So the precipitous nature of cryptocurrency adds-on to the vulnerability of this currency.
  • Another important factor being Cryptocurrency is virtual in nature and can only be found in your Crypto account that is linked to the storage on your Hard Drive and protected by a unique key. So basically Hard Drive is the virtual wallet for your virtual currency. On a bad day, if your hard drive gets crashed or stolen or gets hacked online, it will wipe out the whole stash of cryptocurrency of the owner leaving him/her empty-handed.
  • Many big names in the cryptocurrency online exchange portals claim to be the safest place one can store their cryptocurrency but the fact is they are 'lying'. All such systems are equally prone to online hackers attack as your system, as nobody knows who can crack the next code and get into their servers and exit will hands full of cryptocurrency.
  • Transaction of a cryptocurrency is irreversible in nature. And by that, we mean irreversible to death. Now whether you have transacted your crypto to the wrong person or to a spammer, no individual on this mother earth can bring back your currency by any means (yes, of course, if the second party agrees to return your crypto, you're a lucky lad). This makes it even more typical to use.
  • If that's not enough to raise your ears with suspicion, this will. Cryptocurrencies are pseudonymous by nature. Accounts and Identities of crypto owners are neither connected to the real world entities nor is the owner traceable. You are just sending and receiving the currency on a 30 characters long address that only God knows who owns it.
  • Since the transaction can be made to anyone and everyone on this planet having 30 character address without any monitoring, it has become a piece of cake to exchange currency in the black market. 

You will love to read this: What is Google Fuchsia? Is Google Planning to replace Android?

The absence of a gatekeeper makes cryptocurrencies a risky affair.

Ways to keep your CryptoCurrency Safe

  • Get rid of your free anti-virus. To be honest, no lunches are for free in this world. You have to pay if you want a productive and useful product. No one works for free then why expect your anti-virus development team will work for free and will work day and night to provide you with security updates and hence protect you from cyber attacks.
  • Use a genuine OS on your computer/laptop, reason being the same as the previous point. Using a genuine and up-to-date software/OS enables you to get security patches and security upgrades making you and your crypto less prone to hackers.
  • Use a hardware wallet like KeepKey, Trezor, and Nano Ledger for storing your cryptocurrencies instead of opting for online storage on any Crypto Exchange. Make your hardware wallet more secure with a strong password and encryption.
  • While creating your cryptocurrency account make sure to make a strong alpha-numeric-character password that is really hard to guess and change it from time to time.
  • If you are a digital currency buyer or transactor it is advisable to encrypt whole of your hard drive.
  • Use a password manager to keep a track of your current passwords and manage the future ones by finding out if you have used a particular password in the future.
  • Never share your private key with anyone whatsoever because this is like an ATM pin that acts as the last step in the transaction process.
Enough being said about the security issues and vulnerability of Cryptocurrencies there is no two way to the fact that Cryptocurrency is the future of digital transaction and it is 'here to stay'.

What you guys think of Cryptocurrency and its safety? Do let us know in the comment section below.

No comments:

Post a Comment

Popular Posts