Cryptocurrency Can Be Accepted As A Mainstream Financial Instrument In India

by May 1, 2018 0 comments

A Wallet is a folding case for safely holding your physical or paper money. Similarly, to securely manage your digital money there is a cryptocurrency wallet. Thus, the protection of cryptocurrency wallets is of supreme importance to control your digital money and assets.

cryptocurrency

To explain the risks, measures and technology behind the cryptocurrency wallets, we held a discussion with Edward Sun, SVP of Cheetah Mobile. He said that he and his team are constantly working on developing the innovative hardware-based security measures to add another layer of security to protect users’ digital assets from potential leaks and thefts. He further explained various aspects of cryptocurrency wallets.

What are cryptocurrency wallets? What are its purpose and features?

Cryptocurrency wallets are tools for managing and storing private keys, which give users control over the digital assets stored at corresponding addresses. They offer a variety of basic functions, including the ability for users to create addresses to receive digital assets, transfer digital assets, and check their balance and transaction histories.

Digital wallets let users set up one or more addresses based on cryptographic principles, with each address corresponding to a pair of keys consisting of a private key and a public key.Public keys are generated from private keys through a fixed calculation. Private keys are the only way to ensure control over one’s digital assets, so the protection of private keys is the most important function of a cryptocurrency wallet.

One way of displaying private keys is the use of mnemonic phrases. Private keys can be long and difficult to memorize, the mnemonic phrases are a random list of words which make it easier for the user to remember their private keys. A critical function of Blockchain wallets is the secure management of mnemonic phrases. A wallet can only be considered safe if it can securely manage private keys.

What are the potential risks posed by cryptocurrency wallets?

Cheetah Lab and Cheetah Blockchain Research have identified the major security threats to cryptocurrency wallets which involve either user behaviour or the security features of each individual wallet.Many users allow their private keys to be stored on the servers of different service providers on cryptocurrency exchange platforms. By doing so the users expose themselves to potential security threats.

Service providers can be hacked leading to the loss of assets. Account names and passwords can be compromised as many people tend to use the same name and password to register on multiple sites which makes it easier for hackers to access account information and steal digital assets. Hackers can also exploit security loopholes within browsers, as well as browser plugins to access users’ account information.

On the app developer end, if the wallet employs simplified payment verification (SPV). Your private keys are stored either on a cloud server or a storage device and the security of the device can be compromised. The other risks include network traffic threats, keyboard input risks, operating system vulnerabilities.By exploiting these vulnerabilities, hackers can easily break through the security barriers of operation systems and gain access to users’ digital wallet private keys.

As of now, security competencies of most cryptocurrency wallets rely completely on the security barriers of operating systems. For storage and management of private keys, they still rely on static passwords and even plain text passwords. Operating system security barriers are also used to restrict visits from other apps. The lack of safeguards against operating system loopholes results in the attack on user’s digital assets.

What security measures could be taken for protecting the cryptocurrency wallets?

The development and adoption of cryptocurrency wallets will heavily depend on how secure they are and how effective the security features are in a wallet. In order to avoid security risks, developers must identify security issues and take steps to rectify it before it is released to the users at the users’ end, it is essential to transfer the digital asset to a new address and delete the old address.

Users who may be using cryptocurrency wallets that have security vulnerabilities should opt for a safer wallet until the wallet app they are currently using has resolved the problem. It is believed by the Research Lab that cryptocurrency wallets must protect users in five key areas to truly be considered secure – Hardware loopholes, Network Traffic Security, File Storage Security, In-app security and Data backup security.

What kind of new technology could be been to safely store the wallets?

Security is the top priority of a cryptocurrency wallet and we stand on top of the advanced technologies for highest security. A lot of money lost is actually cost by entry-level private leaks such as private key lost or online hacks. At Safewallet, we aim to provide users with the easiest to use and highly secured using experience for users.

We apply four level of security including basic security system, private key management security system, user behaviour security system and development process security system to turn your smartphone into a hardware-like secure wallet, preventing users from loss or theft of digital assets. We’re also developing innovative hardware-based security measures to add another layer of security to protect users’ digital assets from potential leaks and thefts.

What is the future of digital money in India?

Indians are slowly getting to grips with cryptocurrencies and digital money in general. There is a growing interest, especially among millennials who are investing in cryptocurrencies and viewing it as an alternative means of investment. Currently, there are 600,000 Bitcoin users in India.

The number is only expected to grow as more people gravitate towards this form of currency. Government regulations when it comes to cryptocurrency in the near future is key to estimate its growth. As misinformation and misconceptions about cryptocurrencies get debunked, it will make way for it be viewed and accepted as the mainstream financial instrument.

To conclude, digital Money has created a financial agitation in the recent times. Also according to the experts and as discussed the future of digital currencies and wallets and their security will be significant.

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