Safety Tips | How to Safeguard Your Digital Assets

Common Causes of Digital Asset Loss and Strategies to Prevent Them

Managing digital assets involves multiple potential risks that could lead to loss. Here are some common scenarios and corresponding strategies to help users better secure their digital assets:

1. Improper Backup of Recovery Phrases

Risk:
Decentralized wallets do not store users' recovery phrases. If the recovery phrase is lost, the digital assets become irretrievable. Statistics show that the most common cause of asset loss is not theft but users failing to secure their recovery phrases. If lost or if the wallet device is damaged, assets cannot be recovered. Worse, if the recovery phrase is poorly managed and leaked to others, assets can be easily stolen.

Strategies:

• Physical Backup: Use physical mediums such as handwritten notes or dedicated recovery phrase storage boxes.
• Offline Storage: Keep backups offline to avoid exposure to online hacking.
• Multiple Backup Locations: Store backups in different physical locations to protect against catastrophic events.

2. Granting Transfer Permissions to Malicious Contracts

Risk:
When interacting with decentralized applications (DApps), users may inadvertently grant transfer permissions to malicious contracts. Such contracts could steal assets without user confirmation. The DApp ecosystem often includes many unknown or untrustworthy contracts, making mistaken authorization a common cause of asset loss.

Strategies:

• Audit Contract Code: Where possible, have professional auditors review the contract code for safety.
• Choose Trusted Contracts: Interact only with well-known, verified contracts.
• Regularly Check Wallet Permissions: Periodically review and revoke permissions for unknown contracts to mitigate risks.
• Authorize Carefully: Ensure the contract is trustworthy before granting transfer permissions, and be ready to revoke access.

3. Falling Victim to Scams

Risk:
Scammers use various methods to trick users into revealing recovery phrases, private keys, or transfer permissions, leading to asset theft. Many users are caught off guard and fall prey to these schemes.

Strategies:

• Protect Recovery Phrases/Private Keys: Never share your recovery phrase or private key with anyone. Any request for them is likely a scam.
• Be Wary of Links and Software Downloads: Avoid clicking on links from unknown sources or downloading unverified software to prevent phishing attacks.
• Use Verified Websites: Ensure the digital asset platforms you visit have valid security certificates and use secure URLs.
• Monitor Accounts Regularly: Check your wallet accounts regularly for unusual transactions.
• Seek Professional Help: If scammed, report the incident promptly to authorities or professional organizations.

4. Hacking Attempts

Risk:
On the blockchain, recovery phrases represent asset ownership. If a hacker gains access to your recovery phrase, they can import it to another device and steal your assets. Hackers often use phishing or malware to obtain recovery phrases or private keys.

Strategies:

• Use Hardware Wallets: Store private keys in offline hardware wallets (e.g., imKey) to prevent exposure on online devices.
• Download Official Apps: Always download wallet apps from official sources to avoid malware or phishing applications.
• Manually Enter Recovery Phrases: Avoid copy-pasting recovery phrases; input them manually to reduce the risk of leakage.
• Avoid Jailbreaking or Rooting Devices: Do not jailbreak or root devices, as this can expose vulnerabilities for hackers to exploit.
• Visit Trusted Links: Only access trusted, verified links to avoid phishing websites.

Additional Security Recommendations

1. Hot and Cold Wallet Separation

To maximize security, adopt a hot-and-cold wallet strategy. Use software wallets like imToken for small transactions and hardware wallets like imKey for managing larger amounts. Combining these ensures both convenience and safety.

2. Regular Software and OS Updates

Keep wallet software, operating systems, and device security patches up to date to fix known vulnerabilities and protect against attacks.

3. Manage Installed Applications

Reduce unnecessary apps, disable auto-start settings, and remove unused applications. Avoid installing unknown software, especially those with remote desktop features, to prevent data theft.

4. Disable Cloud Storage

Avoid storing sensitive information like recovery phrases and private keys in cloud storage to minimize risks of cloud service leaks.

5. Use Strong Passwords

Set strong passwords combining uppercase letters, lowercase letters, numbers, and special characters, and update them regularly. Strong passwords enhance account security and protect against brute force attacks.

By implementing these strategies, you can significantly reduce the risks associated with digital assets. Stay vigilant, regularly review and update your security measures, and build a solid defense for your digital wealth.