Understanding the Risks of Cryptocurrency Trading: A Guide
Cryptocurrency is becoming increasingly popular, but the risks associated with it are not always understood. According to a recent survey*, a significant proportion of individuals are unaware of the potential threats faced by cryptocurrency owners. Although cryptocurrency has become more prevalent, only 25 percent of survey participants reported having a great deal of knowledge regarding the risks associated with its use, while 23 percent had no knowledge on the subject.[0] Younger consumers aged 35 and under demonstrate a greater understanding of such threats, whereas awareness of such issues decreases with age.[0] 27% of respondents identified cyber threats, such as virtual theft and scams, as their primary concern when it comes to utilizing cryptocurrency, while 26% also viewed them as their top worry.[1]
The Securities and Exchange Commission (SEC) is taking an increasingly active role in the cryptocurrency space. From 2013 to 2022, the SEC has initiated 127 enforcement actions, comprised of 82 litigations and 45 administrative proceedings, in relation to cryptocurrency.[2] Of the 30 crypto-related enforcement actions issued in 2022, 14 involved initial coin offerings (ICOs), and over half (57%) of these ICO-related actions included a fraud allegation.[2] Recent developments in the cryptocurrency market include the increasing use of application-specific integrated circuits (ASICs) for mining, as well as an increase in investments in cryptocurrency based devices.
Before trading, there are some important considerations that need to be taken into account. Threats concerns vary by region, with crypto-investment fraud and fake apps being major concerns in South Africa and APAC countries, while extortion attacks are a problem in Europe.[1] The survey also found that half of respondents have been affected by cryptocurrency crime in some way, revealing the wide range of criminal activities in the field.[1] Survey results revealed that 49% of people did not think that existing crypto protection systems were effective, and 40% of crypto owners were not convinced of their adequacy.[0]
Kaspersky, a global cybersecurity and specialized security solutions provider, recommends a few best practices to maximize the benefits of using cryptocurrency safely.[1] These include creating strong and unique passwords for each of your crypto accounts, being wary of suspicious emails or links, and never sharing your private keys.[1]
In conclusion, it is essential to understand the potential risks of using cryptocurrency and to take the necessary steps to ensure that your cryptocurrency is kept safe.[3]
0. “Kaspersky survey: half of users hit by crypto cybercrime, one-in-four …” www.kaspersky.com, 31 Jan. 2023, https://www.kaspersky.com/about/press-releases/2023_kaspersky-survey-half-of-users-hit-by-crypto-cybercrime-one-in-four-unaware-of-crypto-risks
1. “Kaspersky survey: half of users hit by crypto cybercrime, one in four …” usa.kaspersky.com, 31 Jan. 2023, https://usa.kaspersky.com/about/press-releases/2023_kaspersky-survey-half-of-users-hit-by-crypto-cybercrime-one-in-four-unaware-of-crypto-risks
2. “Cornerstone Research: SEC Tightens Cryptocurrency Enforcement” www.prweb.com, 31 Jan. 2023, https://www.prweb.com/releases/cornerstone_research_sec_tightens_cryptocurrency_enforcement/prweb19120222.htm
3. “The dirty secrets of cryptocurrency explained | Stuff.co.nz” www.stuff.co.nz, 31 Jan. 2023, https://www.stuff.co.nz/environment/climate-news/130736196/the-dirty-secrets-of-cryptocurrency-explained
