In light of the recent Ledger incident and the growing price of Bitcoin, we believe it’s important to understand data privacy, online security and how you can best protect your Digital Assets.
Data Privacy is incredibly important and has recently started to potentially be considered a human right. This can be seen through not only social demands from average internet users, but increasing regulations which have the goal of protecting user privacy. Many internet users aren’t aware, but their web browsing history, physical location, online tendencies, social media activities and much more are used in order to create a sort of online identity map of you.
Now that we have covered why Data Privacy is important, we must discuss information security. Once these large heaps of data have been taken in by companies, they have to store this data. This is one of the reasons why many are opponents against KYC/AML regulations, because it requires entities to store huge piles of personal identifying information, which can create large honeypots for attackers.
This brings up to the recent Ledger incident, which saw a data breach turn into a large public data dump. This resulted in over 1 million email addresses and more than 271,000 Personal Identifiable Information (PII) leaked onto a public hacker forum for anyone to download for free. This Personal Identifiable Information (PII) includes names, addresses, phone numbers and other sensitive information. This is arguably the worst thing that can happen to a crypto investor, the only thing missing was their total amount of crypto they hold.
Crypto Security & Institutional Custody
This is why institutional custody is arguably one of the most important puzzle pieces when it comes to having crypto grow into a mainstream asset class. While the crypto community is proud to be able to hold their own assets, this inherently brings tradeoffs.
The PROS of “hold your own keys” is giving you the ability to take your funds anywhere and potentially use them as you wish. This is a great benefit, but does require not only technical knowledge but practical knowledge as well.
The CONS of “holding your own keys” is that it leaves you open to malicious actors who can attempt to perform various types of attacks on you.
- Phishing Attacks: This is where an attacker sends a communication (email, text message, phone call…etc) that tricks a user into believing the attacker is actually an authority figure. There have been many recent phishing attacks conducted on the victims of the Ledger breach. It even saw XRP owners lose over 1.1 million dollars. You can protect yourself from phishing attacks by studying these types of attacks and ensuring you are only interacting with verified sources.
- Physical Attacks: This is potentially the scariest attack type and hard to protect from. If an attacker knows you hold crypto and they know your physical location, they can use physical force in order to get you to hand over your crypto assets. You can protect yourself from physical attacks by not only using privacy preserving techniques, but by using institutional custody. This is why you don’t see the wealthy attacked for their money, because they don’t hold their wealth inside of their house but with institutional level custodians.
iTrustCapital places data privacy, information security and institutional custody as the highest priority for our clients. We are proud to say that iTrustCapital clients receive institutional custody support through Curv. If you have questions or require assistance, please feel free to reach out to us anytime.