When we buy or sell crypto, we rely on our trusty wallets to keep our funds safe and secure. But no wallet is ever totally safe from cybercriminals, and many individuals have become victims of hacks, wherein their funds are either partly or entirely stolen. The thought of losing your crypto is very scary, but it's important to be aware of the necessary steps you need to take if someone else gains access to your wallet.
So, what should you do if your crypto wallet has been hacked?
How Do You Know if Your Crypto Wallet Has Been Hacked?
There's often one simple way to determine whether your wallet has been hacked. If you see any transactions take place that weren't directly authorized by you, it's likely someone has gained access to or taken control of your wallet. If your bank account is also connected to your wallet, cybercriminals may try and access the funds stored there, too. So, you should check your bank account's recent transactions to scope out any unauthorized withdrawals, too.
If you set up alerts for both your bank account and crypto wallet, you'll be notified of any transactions that take place by text, email, or the relevant app if you have one installed. You could consider this option if you don't tend to check your accounts very regularly.
Some wallets also offer two-factor authentication, wherein a transaction cannot take place without a second layer of verification from you. So, if your wallet offers this feature, it's best to take advantage of it for that added level of security.
So, if you've realized that someone has hacked your wallet, what's the next step?
1. Run a Malware Scan
While someone can gain access to your wallet without the use of malware, it's still common for cybercriminals to use such software to gain access to your personal information or accounts. So, if you believe that someone has gained access to your wallet, you should run a malware scan using the antivirus software installed on your device.
If it appears that there is malware on your device, then you need to be careful about what you do next. Your antivirus software should be able to destroy the malware, so you'll need to do this before transferring any funds to another device (as doing this in the presence of malware could transfer it onto the next device).
After the malware has been removed, run a second scan to ensure that your device is now clear of any dangerous software.
2. Transfer Your Funds
Once you know your device is malware-free, it's paramount that you transfer any existing funds from your compromised wallet to another wallet. Hackers will often wipe your account of funds immediately, but if you're lucky and they have not done this yet, it's time to take immediate action.
If you want to transfer your funds to another wallet that you already own, then it's best to check that wallet's transaction history first to make sure there's no suspicious activity taking place. If you've determined that your other preexisting wallet is secure, then transfer all your funds over as soon as possible.
Otherwise, you can create another wallet. It might be beneficial to do a little research to find a particularly secure crypto wallet provider with which to store your crypto, as some are lacking in their security features, making it that much easier for cybercriminals to steal your funds.
3. Notify Your Wallet or Exchange Provider and the Authorities
If a wallet or exchange provider receives numerous complaints about compromised wallets, then there's a good chance they'll make some changes to their service to up the security levels. On top of this, your wallet or exchange provider may offer a fund recovery scheme that will replace your stolen crypto, so getting in touch could help you in more ways than you'd think.
For example, Binance, one of the world's most popular crypto exchanges, supports users whose stolen funds have been transferred to another Binance account. If you contact the police and provide Binance with enough evidence to prove that your funds were stolen, Binance will freeze these assets and work with the authorities to resolve the issue.
In any case, notifying the authorities when your funds have been stolen is crucial, so make sure you notify the police and give them all the relevant information to conduct an investigation. Note that many exchanges and wallet providers advise that you contact the police if your funds are stolen, but it's always important to get in touch with both parties so that they're aware of the crime and can offer support.
4. Change Your Login Details and Use More Security Features
While using the same login details and password for a range of different accounts is convenient, this drastically lowers your security levels and is something you should never do. Using different login details for different accounts is a quick and easy preventative measure that can mean the difference between saving or losing your funds or personal information.
If you're worried about forgetting your numerous passwords or usernames, you could opt for an offline password manager, store physical copies of your details, or use hardware with no connection to the internet (like a USB drive). These are particularly solid options for storing seed phrases.
While password manager software is great for storing login information for social media, shopping websites, or similar, we don't recommend using software to store login information for accounts that contain funds or highly sensitive data.
On top of this, you should ensure that you're making the most of any security features your new or alternative wallet offers to lower the chances of another hack. Because security is so important when it comes to crypto wallets, your chosen provider should offer a range of features that can help in keeping your funds safe.
These features may include two-factor authentication, multi-signature accounts, and encrypted backups, so take a look at the security options offered by your chosen provider so that you're making the most of the service.
Keep Your Crypto Wallet as Safe as Possible
While added security layers can sometimes make performing actions within your wallet a little more time-consuming, they're crucially important to protecting your funds from malicious parties. So, if you have any kind of crypto wallet, make sure it has some useful security features, and try to make use of them wherever possible. After all, when it comes to your precious crypto holdings, no security measure should be out of the question.
