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I was Hacked so you don’t have to…
November 6, 2022, I was hacked for approximately $500k losing multiple high value NFT’s like Mutant and bored apes along with ETH. It was most of my portfolio at the time and to say the least was devastating. I questioned everything and my role within this space most of all. Should I be here? It is now 2024 and somehow, I am still here and although I have not fully recovered financially, I am in the right direction and most importantly the right mind set.
Interacting with smart contracts and engaging in various cryptocurrency-related processes requires a high level of caution and security awareness to protect your assets and personal information. Here's a comprehensive guide on how to stay safe while interacting with smart contracts and other crypto-related activities:
1. Education and Research:
- Understand the basics of Smart Contracts
Before engaging with any smart contract, thoroughly understand how they work. Learn the basics of blockchain technology and the specific blockchain (e.g., Ethereum) you plan to use.
- Research Projects
Investigate the project behind the smart contract. Look for information about the development team, their experience, and the project's reputation. Beware of anonymous teams or projects with limited information.
- Read Contracts Carefully
Examine the smart contract's code and documentation. Ensure you understand the contract's functions, rules, and potential risks. Avoid interacting with contracts that have unclear or unaudited code.
Use AI such as chat-GPT to copy and paste a contract for an additional layer of safety when possible.
2. Use Trusted Wallets and Exchanges:
- Choose Secure Wallets
Use reputable cryptocurrency wallets that offer strong security features. Hardware wallets, like Ledger and Trezor, are considered highly secure for long-term storage.
- Use Trusted Exchanges
When buying or selling cryptocurrencies, use well-established and regulated cryptocurrency exchanges. Research their security measures and user feedback before creating an account.
Best practices for myself in general are 3 ‘types’ of wallets.
-Hot wallet: your MM or phantom that you keep a small percentage of your portfolio for your day-to-day activities.
Any mints would be done on an ADDITIONAL hot wallet (one time use) and then transferred out post mint.
- “warm wallet’: a hardware wallet that you interact with contracts with. For myself I have a selling ledger that I put assets of value on that I am looking to trade or sell (shorter term)
-COLD wallet/ VAULT- This is also a hardware wallet but NEVER INTERACTS WITH CONTRACTS. It is used to hold higher value and longer-term assets.
SEED PHRASE STORAGE:
Make sure you have a multi-layer system in place to keep your seed phrases safe. I like to make multiple copies and split the phrase into 12 words (assuming a 24-word seed) and then keep the two halves in different locations. Do what works best for you and will be safe.
3. Secure Your Private Keys:
- Keep Private Keys Offline: Never share your private keys or store them online or any digital form. Use hardware wallets or secure, offline storage methods to safeguard your private keys.
- Use Strong Passwords: Create strong and unique passwords for your cryptocurrency accounts and wallets. Consider using a password manager to generate and store complex passwords.
4. Beware of Phishing and Scams:
-Shut off Discord DMs. Only interact with people that you know and have history with or can verify their ID. Be careful with imitation scammers that will have the exact discord name with a minor change like a period at the end. Pay attention to the details!
- Double-Check URLs: Always verify the website's URL you are interacting with, especially when accessing wallets, exchanges, or ICO (Initial Coin Offering) platforms. Be cautious of phishing sites that mimic legitimate platforms.
*The Twitter/X home page is USUALLY the safest way to get the true link. I say usually because this is not without risk. If the twitter account has been hacked it is impossible to know until its public.
- Ignore Unsolicited Messages and Friend requests: Avoid clicking on links or responding to unsolicited emails, messages, or social media posts promising giveaways or investment opportunities. Scammers often impersonate well-known figures or projects.
5. Enhance Two-Factor Authentication (2FA):
- Avoid SMS-Based 2FA: Do not rely on SMS-based 2FA for cryptocurrency accounts. SMS messages can be vulnerable to SIM card swapping attacks and social engineering. Instead, opt for more secure methods.
- Use Authenticator Apps: Consider using authenticator apps such as Google Authenticator, for 2FA. These apps generate time-based one-time passwords (TOTPs) that are significantly more secure than SMS-based codes.
- Backup 2FA Codes When setting up 2FA with an authenticator app, make sure to back up your recovery codes securely. These codes can be used to regain access to your accounts in case you lose your phone, or the authenticator app becomes inaccessible.
- Use Hardware 2FAFor an even higher level of security, consider using hardware-based 2FA devices, such as YubiKey or Ledger Nano S. These devices provide a physical token for authentication and are highly resistant to phishing and remote attacks.
By implementing these 2FA best practices, you'll significantly improve the security of your cryptocurrency accounts and reduce the risk of unauthorized access.
6. Regularly Update Software, Including Your Web Browser
- Keep Software Up to Date
Ensure that your operating system, wallet software, antivirus programs, and web browser are regularly updated to protect against known vulnerabilities.
- Web Browser Updates
Web browsers often contain security patches that address vulnerabilities. Enable automatic updates for your web browser or regularly check for updates and install them promptly to maintain a secure browsing environment when accessing cryptocurrency-related websites and services.
Keeping all your software, including your web browser, up to date is essential to minimize security risks and vulnerabilities that malicious actors may exploit.
7. Backup Your Data:
- Regular Backups
Make regular backups of your wallet information and private keys. Store these backups in multiple secure locations, such as physical hardware and encrypted cloud storage.
8. Use Hardware Wallets for Large Holdings and Long-Term Storage
- Cold Storage
For significant cryptocurrency holdings and long-term storage, use hardware wallets that keep your private keys offline. This significantly reduces the risk of hacking.
- Avoid Smart Contract Interactions
Keep your hardware wallet, often referred to as your "vault," free of smart contract interactions. A simple way to determine if you are signing a "blockchain transaction" rather than engaging with a smart contract is to check whether you are required to pay gas fees. Transactions involving smart contracts typically require gas fees, while regular transfers and withdrawals do not.
This distinction ensures that your long-term holdings are kept in a more secure environment and minimizes the potential risks associated with smart contract interactions.
9. Verify Addresses and Contracts
- Double-Check Addresses
Before sending or receiving cryptocurrency, double-check wallet addresses and smart contract addresses. A single character error can lead to irreversible losses.
- Verify Contracts
When interacting with smart contracts, verify their legitimacy by cross-referencing contract addresses with trusted sources.
10. -Contract approval revocation
- After using a contract that you will not use again or for a length of time, make sure to revoke approvals. This is not the same as going into MM and disconnecting from a site. All that does is makes it as if you are no longer ‘viewing’ the site. However, any approval will stay until revoked. On ETH revoke.cash will show you all of your approvals and here you can revoke said approval. This now completes their access to your wallet.
- This should be done weekly as a best practice.
*Had I been doing this, I could have prevented my hack. It was obviously a phishing link that I had given approval 6 months earlier.
10. Stay Informed and Cautious
- Monitor News
Stay updated on cryptocurrency news, security threats, and emerging scams. Follow reputable sources to stay informed about potential risks.
- Exercise Caution: If something seems too good to be true or feels suspicious, exercise caution and seek advice from trusted individuals or forums.
11. Consider Seeking Professional Advice:
- If you're new to cryptocurrency or smart contract interactions, consider seeking advice from a financial advisor or a professional with expertise in blockchain technology.
Remember that the cryptocurrency space is rife with both opportunities and risks. By following these safety measures and staying vigilant, you can significantly reduce the chances of falling victim to scams, hacks, or other security breaches while interacting with smart contracts and engaging in crypto-related processes.
12. FOMO:
-most scams are designed to induce FOMO (fear of missing out). Always try to act in a calm measured manner and identify when you are feeling FOMO. No good decision has been made with FOMO brain. Slow, deliberate and cautious is difficult in this space at times but is a most for long term staying power.
It’s a marathon not a sprint. BE SAFE
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