Currently phishing, hacking attacks and cryptocurrency theft have risen as a result of growing blockchain adoption. While no storage option is completely secure, there are still some techniques to boost your cryptocurrency security. One of the best methods to keep your crypto safe is to own a crypto wallet.
What are Crypto Wallets? How do they help secure your crypto storage?
Crypto wallets operate as a central repository for the public and private keys needed to purchase cryptocurrencies and offer digital signatures to validate each transaction. Usually, crypto wallets are divided into two categories: hot and cold.
A hot wallet is linked to the internet, which makes it simultaneously vulnerable to hackers due to their internet connectivity. Security is also determined by the service provider, such as whether the wallet is hosted by a popular exchange with extensive security resources.
Cold wallets are responsible for maintaining private keys in an offline environment. Because it is kept offline on a separate piece of hardware like a USB, a cold wallet is theoretically more secure than a hot wallet. It should be noted that cold wallets are also not impenetrable. PIN code hacking is one of the most common ways hardware wallets can be compromised, but it varies depending on the device.
How does Phemex build a secure crypto wallet system?
Phemex has put in place a highly trustworthy crypto wallet architecture in an effort to give our users transparency and peace of mind. Phemex uses a proprietary Hierarchical Deterministic Cold Wallet System that allots unique deposit wallet addresses to every user, leveraging the fact that cold wallets are generally more secure. Using offline signatures, these deposits are combined and kept in distinct multi-signature cold wallets. Our exchange has even made a few of these cold wallet addresses public so that anyone can examine the platform’s asset funds on hand in order to achieve the highest level of transparency. The proactive, extensive attitude toward customer asset protection has raised Phemex to become a paragon of security amongst CEXes.