How to Protect Your Crypto Wallet Being Hacked by Malware Attacks

Cryptocurrency, a decentralized digital currency that uses cryptography to secure transactions, has completely reshaped how we think about money and investing in the modern world. Bitcoin, Ethereum and Litecoin are some of the best known examples.

While most investors protect their assets inside crypto wallets, using physical ‘cold’ hardware or online ‘hot’ software to hold their private keys, these security measures are not always enough to ward off cyber criminals’ sophisticated malware campaigns.

As private keys allow anyone with access the power to control your crypto funds, they are of crucial importance. But before we explore the best practises to safeguard your crypto investments, let’s firstly take a closer look at crypto malware itself.

What is Crypto Wallet Malware?

Cryptocurrency wallet malware is wielded by hackers to compromise unsuspecting users’ devices and steal their digital assets, often working quietly in the background to avoid detection. Here are some of the main types of malware used by cyber fraudsters:

• Remote Access Trojans: Appropriately abbreviated as RATs, this type of Trojan malware enables hackers to gain full administrative privileges and remote control of devices to access wallets and transfer funds
• Keyloggers: This cunning malware, also known as Keyboard Capturing, is capable of recording victims’ keystrokes, such as wallet passwords and private keys, with the data retrievable by the logging program operator
• Clipboard Hijackers: This form of malicious software is designed to monitor the targeted user’s clipboard activity and replace copied crypto wallet addresses with the fraudster’s, leading to the redirection of funds

How Do Crypto Wallet Malware Attacks Happen?

Cyber criminals orchestrate their crypto wallet malware campaigns for a very simple reason: to commit digital currency theft by stealing and exploiting crypto-related information, including sensitive data like wallet credentials and private keys.

The theft itself becomes achievable once the hacker has, for instance, captured the target’s credentials and private keys by remote control (using RATs), or replaced copied wallet addresses with the attacker’s (using Clipboard Hijacking).

But how do victims’ devices become infected with crypto data-stealing malware in the first place? Here are some of the most common ways this can happen:

• Malicious Downloads: Dangerous files, which can often be found on unverified/dubious websites and third-party app stores, can infect devices with malware-laced files once downloaded; but malicious downloads can also be found through scams (which we will discuss below shortly)
• Fake Ads & Websites: Some internet ads (found on websites, social media channels and apps) may have malicious intentions, linking to spoofed websites featuring malware-laced downloads; it is also possible to encounter malware-injected ads
• Phishing Emails: One of the most notorious cyber scams, phishing involves the sending of fake emails containing links to malicious content; for instance, an email claiming to be from a genuine crypto service may lead to a bogus site designed to steal sensitive data like wallet credentials and private keys
• Social Engineering: Similar to Phishing (above), scammers reach out via social media channels, hoping to snare sensitive crypto-related data; in some instances, orchestrators may slowly build up trust before trying to direct targets toward malicious content, like bogus crypto investment opportunities
• Hacked (Genuine) Websites: If you’re unlucky enough to visit a genuine website that has become compromised, it’s possible that it could now be booby-trapped (courtesy of the hackers behind the breach); for instance, it may contain malware programmed to automatically download itself onto your device

How to Protect Your Crypto Wallet from Malware

Given how a successful cryptocurrency wallet malware infection could lead to the substantial (and often irrevocable) loss of your digital assets, it is therefore imperative that you implement an effective cyber security strategy to help mitigate risks.

Unlike traditional bank accounts, crypto transactions are irreversible – something that should never be forgotten. With this in mind, take your crypto cyber defence seriously; remain vigilant, perform regular device/software updates, and also keep up to speed with evolving threats and security tips making the headlines.

Here are some key preventative measures that can be employed to ensure your cryptocurrency wallets remain secure:

Transaction Safety Tips

• Verify Wallet Addresses: Ensure you double-check wallet addresses prior to completing crypto transactions (a little mistake could be costly); for larger transactions, consider making small initial ‘tester’ payments before paying in full
• Enable Spending Limits: Setting up spending caps, like daily and per-transaction limits, can help to protect you from costly mistakes; it is considered a crucial safety measure for anyone who makes regular trade transactions using ‘hot’ wallets
• Use Multi-Signature Wallets: Those with access to crypto business accounts and shared funds should opt for multi-signature wallets as transactions will require multiple signatures (from designated key holders) instead of one, helping to protect against rogue in-house activity and also genuine mistakes

Device Security Measures

• Use a Dedicated Device: By using a device exclusively for your crypto management and transactions, like a separate computer or laptop, your digital assets will be statistically far more secure – especially if it remains offline while idle
• Clean System Approach: Elevate your dedicated device’s security even higher by aiming for a bare essentials approach, hard-formatting its storage for a clean system install, and only installing relevant, verified applications and tools

Proactive Vigilance & Security

• Automated Notifications: By enabling automated security notifications, you’ll be kept in the loop regarding any unauthorized transactions or unusual activity from your crypto wallets; you should also consider manually monitoring your wallets on a regular basis as an extra precaution
• Securely Store Backup Phrases: Consider storing your backup phrases in multiple physical locations; however you do this, ensure you keep them safe at all times, encrypting digital backups on (non-internet-connected) storage devices
• Regular Security Audits: It is critical that you perform regular checks of your crypto wallet accounts and dedicated/related devices, reviewing measures like system permissions and other security-related settings that may require updating

Fundamental Safety Tips

• Use Strong Passwords: Your crypto account passwords should include a mixture of letters, numbers and special characters; consider using a Password Manager like Total Password which can securely create and store all your passwords inside an encrypted vault, streamlining the logins process
• Activate 2FA: Significantly enhance the security of your crypto accounts by enabling 2FA (Two-Factor Authentication); once enabled, sign-ins will require an additional verification step, such as one-time codes to be sent to a registered email address, phone number or authentication app like Authy
• Keep Software Updated: Ensure that software on any devices used to access/manage your crypto accounts is frequently updated, including operating systems, crypto wallets and applications; this will reduce the chance of un-patched vulnerabilities being exploited by malicious software
• Beware Dangerous Content: Remain vigilant for malicious downloads and scams; for instance, avoid downloading software from unverified websites, and don’t engage with links and attachments contained within suspicious emails (see ‘How Do Crypto Wallet Malware Attacks Happen?’ above)
• Consider Hardware Wallets: Since ‘cold’ hardware wallets allow you to store your precious private keys offline, they will literally be immune from all online-based threats, boosting your protection big-time; a physical device like a laptop, for example, could be used purely for your crypto storage
• Follow Cyber Security News: While you’re learning about current online cryptocurrency threats, cyber criminals are busy evolving their various attack methods and malicious software; this is why it’s essential to follow cyber security headlines for news on how to protect yourself from the very latest threats
• Use AntiVirus Software: As crypto transactions are irreversible and most data-stealing malware is designed to function silently in the background, it is critical to bolster your digital asset security by using AntiVirus software; TotalAV offers Award-Winning real-time protection against threats to remove stealthy malware like RATs and Keyloggers
• Use Browser Security: With scams involving fake emails, ads and websites common vehicles for fraudsters deploying their malicious software, one wrong click can have devastating consequences; browser security tools like Total WebShield, however, can protect your personal data by blocking blacklisted sites, intrusive trackers, and other potentially dangerous content.