The whole point of cryptocurrencies is that they only exist online; they’re never going to jangle like small change in your pocket. All of us involved in the crypto world know that online theft is a risk, albeit one that can be mitigated by storing crypto assets in cold storage. Now, with more people taking crypto security more seriously, and better security tools available, we find that the crypto thieves are taking their activities offline. How can they do that?
The answer is: they are targeting those wise investors who store cryptocurrency offline and, in addition to this, they are finding out the identity of these crypto investors and actually attacking them in the street. As Darryn Pollock in Cointelegraph writes: “A number of cases have been reported where Bitcoin owners are being attacked face-to-face by thieves and being forced to deposit huge amounts of digital currency into anonymous wallets.”
He also cites the case of a Russian businessman who was held hostage on the Thai island of Phuket and forced to log in to his BTC account and pay $100,000 for his release.
This is a shocking development, but there are some steps crypto owners can take to avoid a face-to-face mugging. For a start, never brag about your Bitcoin account balance. Don’t post online about how much you have made in an amazingly short period of time. Would you normally tell people how much you have in your bank account? No, we don’t discuss those things, even with close friends. So, why do it with a crypto account?
Another Russian (they seem to be particularly unlucky) called Pavel Rashin was attacked and robbed in his home. They took about $425,000. They didn’t come for his BTC, but he had publicised online that he had recently become a millionaire thanks to his crypto investments. That was enough to make thieves take an interest in him and as he has an online blog, he wasn’t that hard to find.
Of course, if you’re a famous crypto investor, it is impossible to stay out of the news and there have been some high profile kidnappings, including that of the director of a currency exchange in the Ukraine.
So, don’t talk about your crypto assets publicly. Then take a technical step by setting up a multisignatory wallet. Wallets that require confirmation from multiple addresses to make a transaction permit allow the controlling keys to be spread out to different deposit boxes, banks, safes, and other locations. Therefore, even if one key is compromised, you still have control over your funds.
And finally, if you are faced with theft – give them the crypto. Your life is always worth far more.