By Bogdan Patru, a Cyber Security writer at VNTeacher.com, a website dedicated to providing quality online privacy and data protection advice.
Cryptocurrencies have taken on a whole new importance since 2017 when they reached a peak in popularity and efficiency. Bitcoin, for example, is currently perceived as a potentially very lucrative investment. However, the downside to purchasing cryptocurrencies is the lack of security.
I’m talking about the moment you decide to perform transactions because the coins themselves are the most secure virtual currencies by themselves. Still, there have been cyber-attacks on the crypto-market, with the most serious taking place in July 2017 when $32 million worth of Ethereum was stolen by hackers.
Experts recommend that besides using a Crypto Wallet to store your cryptocurrencies in, you should also seriously consider using a Virtual Private Network.
Think of it like this:
- The Crypto Wallet gives you a safe and encrypted storage site
- The VPN’s encrypted tunneling protocol shelters the transaction process so it becomes inaccessible to any outside parties
All communication is traceable now. The internet works on data packets, further subdivided into components such as the IP or destination of the information. Even for the crypto blockchain, the communication process is basically the same.
If a hacker intercepts those packets while mid-flight between the source and destination, they can potentially access your personal data and steal whatever is inside, including information about cryptocurrencies themselves.
If Bitcoins can be defined as being decentralized, then the same can be said about quality VPN providers. They have plenty of servers you can use at your own leisure, when performing your crypto-transactions.
The VPN acts like a shield, keeping all your data secure and private. This is merely one step that you can take to ensure your anonymity. They can do much more, like hiding your activities and financial transactions from your ISP as well, which could come in-handy.
It’s widely known that your ISP and other government agencies are well aware of your comings and goings on the internet, including your monetary activities. A VPN will make sure all your in-line communications will be routed through one of the many encrypted, dedicated servers hosted in a single, secure location.
At this level, nothing else matters other than the level of encryption that the server is using. You don’t want any third parties or hackers to gain access to your cryptotransactions.
A VPN’s main function is to make the user invisible in and out of the network.Generally, your device will send and receive signals from the websites you visit, aswell as communicate with their databases when you perform more complex actions.
With the online security provider covering your tracks, those signals will first passthrough the private server where they’re granted a new, untraceable, dynamic IP, and only then will they go to the original destination.
Ideally, this is what will happen when you use a VPN, with regard to cryptotransactions:
- Your ISP and other possible trackers will not know when and what cryptowebsite you visit, what you plan on doing there, and what you eventually end up doing. You become completely invisible
- Through the OpenVPN and other VPN-specific encryption protocols, a cryptotransaction’s data packets will become inaccessible and cyber-proof. Only you and the target-destination possess the decryption keys.
- It protects you from possible phishing attacks on suspicious websites. Still, even with the VPN there, you have to be extra cautious what links you access.
- Geographical limitations will be rendered useless because of the VPN’s SmartDNS function which scrambles any foreign encryption attempts. This will allow you to expand the potential of cryptocurrency transactions.
What you can do to seal the deal and make sure your privacy stays private is to pay for your VPN with cryptocurrencies. By now, it should have become clear that if you want to purchase, trade or use cryptocurrencies in any way, a VPN is the only way to make it all secure.
However, you can go a step further and strengthen your security protocols even further. Generally, when you pay for the VPN with traditional means like credit or debit cards, you leave cyber breadcrumbs behind you. That’s something you can’t change no matter what you do.
And to any hacker, the fact that you’re using a VPN translates to attempts at concealing confidential information, important transactions, and so on. By walking in your footsteps, he can eventually stumble upon your crypto account.
With your bank credentials in hand, he’ll be able to log in and rob you blind. Or he can even delete your wallet, depending on what his purpose is.
The benefits of using a cryptocurrency combined with a VPN become apparent. However, just like the crypto market has become exponentially bigger recently, with plenty of different currencies active, so did the VPN industry develop by quite a lot.
Users will need to pay attention to a few things when choosing their VPN. Not all of them are as good to protect your crypto-transactions.
Here are a few tips:
- The jurisdiction is immensely important. Avoid VPNs based in countries belonging to the Fourteen Eyes Alliance because they will probably be monitored and tracked
- The second most important thing you have to watch out for is the no-logs policy. It needs to be transparent, crystal-clear, and concise. This means that not even the VPN will keep any traces or leaks of your activities on the internet
- Preferably, you should also be able to pay with crypto-currencies, just to add a little more security to the mix
- A kill-switch is indispensable to a good VPN. It acts like an on and off switch that cuts off your internet access if the online security provider crashes for some reason.
In the end, there’s no doubt about it – using a VPN is vital when working with cryptocurrencies.