Risk Of Bitcoin Hacks And Losses With Centralised Wallet

For most digital currency investors, the centralized cryptocurrency exchange isone in all the foremost vital vehicles for transacting. Centralized cryptocurrency exchanges are online platforms used to buy and sell cryptocurrencies. They are the common platforms use to shop and sell cryptocurrency holdings .To be centralized means to trust someone else to handle your cash.

In centralised exchange, money remains in the hands of exchange. We all must have heard various cases where investors have lost their hundreds or thousands of dollars because sometimes people forget the private key of their wallets. But with centralised exchange people don’t have to worry about it. Middleman helps the customer in recovering their lost password because exchange has the full access to customer’s account.This can additionally take the pressure off of the client of being 100 percent in control of their money.

Despite having these advantages, centralised wallet has some pitfalls in terms of safety of crypto assets. These exchanges are prone to hacking as a large amount of customer data including their private key is stored with them which attracts hackers.

There are cases where hackers have taken crypto assets price countless bucks.
Although some exchanges have started refunding the investor’s money ,like in March 2018 Japan-based exchange “Coincheck “ had refunded more than $440 million to investors using its own funds. In all the hacking related frauds, hacker manages to get access to the database, changes its balances and withdraw the funds.

It is always good to learn from the past. Keeping this in mind let us look at some famous bitcoin hacks. A Japan based bitcoin exchange known as Mt. gox was hacked twice.

First time in2011, when the hacker was able to get ahold of Mt.Gox’s auditor’s credentials and transferred 2609 bitcoins to an address for which Mt.Gox had no keys. Second time in the second time in 2014, at a time when Mt.Gox was handling virtually seventieth of Bitcoin transactions within the world.

Bitcoins of around $350 million were found missing from his exchange. Soon it became bankrupt. Second largest Bitcoin hack ever made after Mt.Gox was in August 2016 in Bitfinex. The breach claimed 120,000 BTCs of worth $72 million. It happened because attackers were able to exploit a vulnerability in the multisig wallet architecture of Bitfinex and BitGo .But unlike Mt. gox, Bitfinex issued BFX tokens for victims that were redeemable in USD, and hence, most of their investors were refunded their money back. Poloniex takes the third place in the long list of victims, it was found that 97 BTC were stolen from them.Coincheck was attacked by hackers within the last days ofJan2018.

The target, as in most cases, was the hot wallet of the exchange, from which 523 million NEM tokens were stolen.

So In the nut shell, we should keep our cryptocurrencies under our control and not on centralized exchanges. Because most of these hacks happened because private keys were handled carelessly.

In the period of Bitcoin individuals didn’t have that abundant data regarding these items.
But now, there is lots of educational material available about private keys and hardware wallets.
Because of the complicated process of registration and the concerns about the safety and privacy of data among the customers one should use the decentralized exchanges. In order to buy a bitcoin, the very first step is to sign up for coinbase account, where we can store our bitcoins safely and easy payment methods are also available for converting our local currency into or out of bitcoin. After sign up we have to connect our bank account with it following some verification steps we can start purchasing.

There are so many good decentralized exchange. One such peer to peer transaction platform that comes with various security options for the protection of one’data is the PINT. It comprises of HD wallet (BIP39) and P2P market place. It is highly secured because all the transactions in this platform are secured with AES256 encryption. On-chain escrow gives protection to both buyer and seller and take away all the risk. P2P comes with encrypted chat function for buyers and sellers where they can chat and share the payment details without hesitation. PINT Wallet is totally anonymous and private wallet, however to use P2P exchange, users need to register. PINT has anti-theft functionality where user can delete the wallet from lost or stolen mobile device.

So if you want to invest in crypto assets and at the same time you want to be tension free then Use PINT and live your life smoothly.

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