Even a 5-year-old is aware of the most hyped digital currency called bitcoin. Bitcoin is the most popular and talked-about digital currency. The valuation of bitcoin grew by almost 300% in 2020 alone. As per a report, almost 46 million Americans own a share of bitcoin. All these data reveal the growing popularity and use of bitcoin.
But, still, in many parts of the world, people are worried about the risks associated with bitcoins. In this article, we will try to know if the benefits of bitcoin outweigh its risks or not.
Bitcoin benefits Vs. Bitcoin Risks
Autonomy of users
The exchange and trading of bitcoins and other cryptocurrencies takes place through a technology called bitcoin. This means anyone who is a part of the blockchain network can see the online transaction. The parties who are making the transactions are anonymous as no identity is needed if you want to make a bitcoin transaction. Although bitcoin’s purchase discretion and user autonomy features look exciting to some people, there is a negative side to this story.
The purchase discretion and anonymity can also help cybercriminals in their fraudulent activities. The anonymity associated with bitcoin transactions makes it impossible for someone to associate someone with a cryptocurrency wallet. In addition to this, there are instances in which a user may have many bitcoin wallets. Thus, they may keep on spreading the virtual currency from one address to another without getting caught.
For cybercriminals who want to attack individuals with ransomware, the anonymity of bitcoin is a favorable situation. You will be surprised to know that bitcoin accounts for almost 98% of ransomware payments. Thus, most cybercriminals attack users and their devices, and they demand bitcoin in exchange for payment.
Most people want to make transactions in bitcoins as no middleman is involved in the process. Thus, people don’t have to worry about government authorities or banks checking their financial transactions. Thus, it offers more money spending autonomy to users.
But, the other side of the story is that the lack of a monitoring authority also opens doors for cybercriminals. A hacker can steal the private keys of a bitcoin wallet, and the user won’t be able to gain access to their bitcoin wallet ever. In the absence of a central authority or a watchdog, users can’t make any complaint about any of these cybercrimes.
How can users protect themselves from these loopholes?
Bitcoin is just a decade-old cryptocurrency. In all types of investments, you have to face one or the other loopholes. If you are sure about making an investment in bitcoin, you can easily get rid of these loopholes by following certain security protocols.
No doubt, Bitcoin is prone to certain risks, but its advantages certainly outweigh the risks. Follow all these tips to keep yourself safe from all these threats associated with bitcoins:
Stay a bit skeptical
Bitcoin is a new technology. Thus, before you start planning a bitcoin investment, try to have enough knowledge about the technology. Do your homework and research the security options. Note down all security issues and know how you can mitigate all these risks.
Never pay ransom
Even when a hacker targets you with a ransomware attack, try not to pay the ransom amount. At that moment, paying ransom in bitcoin may seem the only available choice. But you can’t be sure that you will get back the encrypted files. Paying the ransom may also create more ransom families. Thus, try not to make any payment.
Data backup is one of the best methods that can keep bitcoin safe in your wallet. You can also keep a copy of important keys in an external hard drive. Even when you face a ransomware attack, you can easily format your device and reinstall the file. Backup of data also helps in protecting your data. Backup of data can’t prevent ransomware attacks, but it can certainly mitigate the risk of data loss.
Update the credentials
Another easy way to protect your bitcoins is by updating credentials like passwords and other details. Try to change the password at regular intervals. If you are using bitcoin for your business, you can also employ a password manager who will update the password and other credentials.
The benefits of bitcoin outweigh its risks if you are careful about all these security features of bitcoin. Check the website https://immediate-edge.live/ to know more about the benefits and demerits of bitcoin investment.