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5 disasters in the world of digital currencies that should be learned from

5 disasters in the world of digital currencies that should be learned from

The space of digital currency is an exciting and attractive world that grows day by day and increases its attractiveness. However, sometimes unfortunate events or gross mistakes of users and investors lead to the loss of large amounts of capital and their assets. Investors in the field of digital currency should always be alert and cautious and observe the aspects of caution and security in every action in order to prevent such incidents from happening. Otherwise, they lose their capital and the lost capital cannot be recovered. In this article from Mihan Blockchain, 5 disasters in the world of digital currencies We examine that has led to the permanent loss of users’ capital.

5 disasters in the world of digital currencies that you should learn from

5 disasters in the world of digital currency
Source: boxmining

In this part of the article, a number of Big mistakes Digital currency users And we examine the unpleasant events in this area. It is recommended that you carefully read the lesson and the corresponding security tip in the last paragraph of each section.

One wrong click and $120,000 lost

Phishing attacks in crypto
Source: information-age

Phishing attack is one of the oldest and most common fraud methods, which is also used by Web 3 fraudsters.

Usually, in this method, error messages, wallet pop-up ads and fake links are sent to the victims. By clicking on these links, victims will be redirected to unofficial websites or plugins and their recovery phrase or sensitive information will be revealed.

You might think that people are very careful when they log into fake websites; But the truth is that both beginners and professionals in the digital currency world still fall victim to this type of scam.

A user named PowerofTheGods on Reddit explained how by clicking on a Malicious link, has lost $120,000 of his capital. While this user’s ledger wallet was unlocked, a malware trojan took control of his computer and emptied his wallet within minutes. Before the user’s eyes, all his assets were transferred to the hacker’s wallet, and this image still haunts him.

This user’s story went viral and many people shared their similar unpleasant experience. Some of them have also complained to the judicial authorities; But since the field of digital currency has not yet been legislated, their pursuit has not been successful.

Always when faced with Suspicious linksBe careful, especially the links whose source is unknown. Also, always double-check the link you’re referring to to make sure it’s correct. Some fraudsters copy the domains of popular decentralized applications with very minor changes, so that people do not know the difference between the original and the fake domain.

The death of the CEO of the exchange and the locking of users’ assets

The death of the CEO of the QuadrigaCX exchange
Source: securecdn

This case is a clear example of the phrase “burying the secret”.

Gerald Cotten, CEO of Canadian cryptocurrency exchange QuadrigaCX, died in India in 2018. The digital currencies of this exchange were all kept in a cold wallet and Gerald Cotton was the sole custodian of the assets.

So far no one has succeeded in unlocking the password of his laptop wallet. As a result, the assets of more than 115,000 users, including 26,500 Bitcoins, 11,000 Bitcoin Cash units, 200,000 Litecoins and 430,000 Ethereum units, have been locked forever.

In early 2022, Netflix aired a documentary called “Trust No One: The Hunt for the Crypto King” about Cotton’s life and death in India. The moral of the story is to never keep your digital currencies on an exchange, especially if you have a large capital. It is better to keep your assets in Ledger or Trezor hardware wallet.

Forgetting the hard drive password that contained 7002 bitcoins

Forgetting the hard drive password that contained 7002 bitcoins
Source: metropolisbierta

So far, about 20% of all bitcoins in circulation have been lost and it is not possible to recover them. This happens when users use the private key or the password of their hard drive that contains Private key They lose it.

Stefan Thomas, a German engineer, in 2011 in exchange for making an animation called “What is Bitcoin?” Received 7002 Bitcoins as reward; But the private key of these bitcoins is encrypted in a hard drive called IronKey It was saved and he forgot the password for this hard drive.

The IronKey hard drive gives the user ten chances to enter the correct password. After 10 unsuccessful attempts, the assets will be permanently locked. Now there are only 2 more chances left for Thomas. Always Password and recovery phrase Write yourself down on a piece of paper and keep it in a safe place. Otherwise, you may lose your capital and regret it for the rest of your life.

Accidentally throwing away a hard drive that contained 8,000 bitcoins

Accidentally throwing away a hard drive that contained 8,000 bitcoins
Source: amazonaws

It has probably happened to you that sometimes you lose one of your things and later find out that your father or mother thought that it was worthless and threw it away. If this device is just an ordinary object, it does not matter much; But a similar incident completely changed the life of James Howells.

Howells had two identical laptop hard drives. One of the hard drives was empty and the other 8,000 units of Bitcoin had in him While cleaning out his office, Howells intended to throw away the empty hard drive, but mistakenly threw away the hard drive that contained bitcoins, which ended up in a landfill in Newport, Wales.

James Howells still suffers from his disastrous mistake to this day. He has made several requests to Newport City Council to dig up the landfill, but his requests have been turned down.

Paying 10,000 bitcoins for 2 pizzas

Paying 10,000 bitcoins for 2 pizzas
Source: i0.wp

Day May 22 as Bitcoin Pizza Day Is known. Buying 2 pizzas with Bitcoin is a famous story in the digital currency world. In 2010, Laszlo Hanyrcz paid 10,000 bitcoins to buy two Papa John’s pizzas, which at the time were worth only $30. Those bitcoins are now worth about $230 million!

Of course, Hanich did not know about the future and he cannot be blamed. Bitcoin was not worth much in those days. If Hanich had kept his bitcoins, he wouldn’t have had to work for the rest of his life. Interestingly, Laszlo has said that he does not regret his work and is happy that his name is recorded in the early history of Bitcoin. In fact, Hanich is the first person to make a business transaction using Bitcoin.

Conclusion

Like other financial markets, sometimes unpleasant things happen in the world of digital currency, as a result of which millions of dollars of capital are lost. Some of these incidents occur due to user negligence and mistakes, which can be avoided by learning and applying security tips. In the above article, 5 disasters in the world of digital currency which has led to the loss of users’ capital. You can also share your similar opinions and experiences with us.

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