Security in the intricate realm of cryptocurrency poses a challenging puzzle. Traditional wallets safeguard funds by demanding signatures from keys derived from seeds. However, this approach is susceptible to phishing attacks and malware. Thankfully, an increasing number of wallets are embracing non-crypto security practices. Yet, good intentions can still breed confusion and a misunderstanding of users’ security levels. Today, one of the most reliable security measures in crypto is Two-Factor Authentication (2FA).
What is Two-Factor Authentication (2FA)?
2FA is a recognition process that verifies your identity using two out of three distinct types of proof:
- Something you know
- Something you have
- Something you are
It goes beyond a mere two-step procedure; it involves two distinct types of evidence. Consider entering a highly secure building. You first swipe an access card (something you have), followed by scanning your fingerprint or face (something you are). This scenario perfectly exemplifies the fundamental principle of 2FA.
How does Two-Factor Authentication (2FA) work?
There are 2 key types of identity verification in 2FA: SMS and authenticator app. We will now deal with both types of identity verification, but first I want to say that even this is not a panacea. What if your data is intercepted? For this, you need a VPN for crypto trading. With VPN for crypto, you can encrypt your data and prevent anyone from intercepting or seeing it. Now you need to use a VPN for crypto investors to protect your portfolio. A good option for this is VeePN, which has 256-bit encryption and 2500+ VPN servers.
1. SMS
SMS was once the primary choice for the second “factor” of 2FA authentication. Many people preferred this method since it involved receiving a code via text message on their smartphones, which were easily accessible.
However, due to the rise of hacking techniques like SIM swapping, the security and reliability of SMS-based authentication have been called into question. This led to the development of authenticator apps, which have now proven to be more secure and reliable than SMS.
2. Authenticator apps
Authenticator apps function similarly to SMS but with one critical difference: the codes are not delivered over the mobile network and can work offline. This makes it significantly more difficult for hackers to intercept the codes.
To use an authenticator app, you need to “pair” it with the account you want to access. If you switch phones, you will need to go through the pairing process again.
When logging into your cryptocurrency exchange account with your username and password, 2FA requires you to enter a one-time password (OTP) sent to your smartphone. This OTP is a 6-digit code generated by apps like Authy, Google Authenticator, or Microsoft Authenticator.
One-time passwords are considered a possession factor, as they are something you have. Since the OTP only works once, it adds an extra layer of authentication before your login is verified. In the unfortunate event that your password is compromised, a hacker would still need the OTP, which can only be provided by you as long as your phone is in your possession.
Without physical access to your device, a remote hacker cannot impersonate you or gain unauthorized access to your account. By combining both factors – something you know (password) and something you have (OTP) – the overall authentication strength is increased.
How to enable 2FA?
To ensure lasting speed and performance, follow these steps in your crypto trading application:
- Tap on the menu and select “Settings.”
- Go to “Security” and choose “2-Factor Authentication.”
- Enable 2FA and enter your passcode.
- Scan the QR code or manually enter the secret key.
- Open the Authenticator app and add another account.
- Manually enter the secret key.
- Paste the code in the text field and save the changes.
- The Authenticator app will generate 6-digit codes with a 30-second expiration.
- Copy the generated code in the app.
- Open the app again and enter your passcode.
- Click on “Proceed to verify” and paste the 6-digit code from the Authenticator app.
How to reset my 2FA?
If you’ve received a message asking you to reset your 2FA, follow the instructions provided below:
- Tap on ‘Setup 2FA’
- Enable 2FA by switching on the toggle
- Copy or scan the displayed code
- In your cryptocurrency trading app, click on the “Disable” button next to 2FA.
Conclusion
Too many traders underestimate the importance of security, relying only on a password or their “warm” wallet. This is not enough. It would be logical to use all the protection options that are available to you. One of the key technologies is 2FA. We advise you to use it wherever you somehow work with finances or valuable assets.
