Thursday 21 January 2021
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Risks Associated with Cryptocurrencies

Risks Associated with Cryptocurrencies

There is hardly any doubt that there are a number of benefits associated with cryptocurrencies. However, at the same time, there are some pitfalls and dangers associated with it. Hence, it would be better to be aware of the possible dangers and challenges when it comes to using cryptocurrencies. As many of us would be aware, cryptocurrencies cannot be used in isolation. They need to be used along with cryptocurrency wallets like Tezbox Wallet and Tezbox web wallet. Let us understand the possible pitfalls when it comes to using cryptocurrencies. We are sure that it will help them in more ways than one and will make sure that they stay away from challenges that could come their way suddenly.

Risk of Spoofing 

This is perhaps one of the biggest challenges and risks associated with cryptocurrency wallets. This could be equated with the plain old theft that we are all aware of. When you transfer cryptocurrencies to some of your friend or for settling some purchases, you have to make use of the cryptocurrency wallets. You may copy the person’s wallet number accurately but there could be some malware that is capable of replacing the wallet number with something totally different. You will not be able to see it in the front end. When this happens, you may end up transferring cryptocurrencies and to your shock and surprise, it may land to the credit of some unknown and wrong account. If the number is combination of alphanumeric characters, some genuine mistakes can also happen. Hence, you need to find out ways to address this problem as best as you can.

Hacking of Payment Gateway 

There also is another big risk of making use of a genuine payment gateway using the correct address but still you may end paying the wrong account. There have been instances when this happened. In the year 2017 Ethereum complained that many of its cryptocurrency holders ended up losing money from their wallets because it was getting transferred to some other account because of hacking and other such problems.

User Address Error 

The above cases were that of fraud, cheating or plain and simple robbery. However, there also could be problems of human error. If the last eight digits of the cryptocurrency special number is not copied properly, you could see the money disappearing and vanishing into thin air. It has happened with many cryptocurrency holders and therefore the wallets should be strong and almost totally free from such issues and risks. However, this may not be always possible and we therefore need to be doubly careful when using cryptocurrency wallets.

Loss of Wallet File 

Let us look at one more problem that is typical of cryptocurrencies. There have been a few instances where the wallets have been lost or stolen. Cryptocurrencies in an online environment are mostly stolen in these wallets. In case of server crashes, there could be loss of wallets and some hackers could get into the networks and steal the wallets at some point in time. Hence, it is important to be aware of the same and overcome the same as best as we can.