Tag Archives: risks

A Cybersecurity Policy Agenda

Post Syndicated from Bruce Schneier original https://www.schneier.com/blog/archives/2020/12/a-cybersecurity-policy-agenda.html

The Aspen Institute’s Aspen Cybersecurity Group — I’m a member — has released its cybersecurity policy agenda for the next four years.

The next administration and Congress cannot simultaneously address the wide array of cybersecurity risks confronting modern society. Policymakers in the White House, federal agencies, and Congress should zero in on the most important and solvable problems. To that end, this report covers five priority areas where we believe cybersecurity policymakers should focus their attention and resources as they contend with a presidential transition, a new Congress, and massive staff turnover across our nation’s capital.

  • Education and Workforce Development
  • Public Core Resilience
  • Supply Chain Security
  • Measuring Cybersecurity
  • Promoting Operational Collaboration

Lots of detail in the 70-page report.

The Legal Risks of Security Research

Post Syndicated from Bruce Schneier original https://www.schneier.com/blog/archives/2020/10/the-legal-risks-of-security-research.html

Sunoo Park and Kendra Albert have published “A Researcher’s Guide to Some Legal Risks of Security Research.”

From a summary:

Such risk extends beyond anti-hacking laws, implicating copyright law and anti-circumvention provisions (DMCA §1201), electronic privacy law (ECPA), and cryptography export controls, as well as broader legal areas such as contract and trade secret law.

Our Guide gives the most comprehensive presentation to date of this landscape of legal risks, with an eye to both legal and technical nuance. Aimed at researchers, the public, and technology lawyers alike, its aims both to provide pragmatic guidance to those navigating today’s uncertain legal landscape, and to provoke public debate towards future reform.

Comprehensive, and well worth reading.

Here’s a Twitter thread by Kendra.

On Risk-Based Authentication

Post Syndicated from Bruce Schneier original https://www.schneier.com/blog/archives/2020/10/on-risk-based-authentication.html

Interesting usability study: “More Than Just Good Passwords? A Study on Usability and Security Perceptions of Risk-based Authentication“:

Abstract: Risk-based Authentication (RBA) is an adaptive security measure to strengthen password-based authentication. RBA monitors additional features during login, and when observed feature values differ significantly from previously seen ones, users have to provide additional authentication factors such as a verification code. RBA has the potential to offer more usable authentication, but the usability and the security perceptions of RBA are not studied well.

We present the results of a between-group lab study (n=65) to evaluate usability and security perceptions of two RBA variants, one 2FA variant, and password-only authentication. Our study shows with significant results that RBA is considered to be more usable than the studied 2FA variants, while it is perceived as more secure than password-only authentication in general and comparably se-cure to 2FA in a variety of application types. We also observed RBA usability problems and provide recommendations for mitigation.Our contribution provides a first deeper understanding of the users’perception of RBA and helps to improve RBA implementations for a broader user acceptance.

Paper’s website. I’ve blogged about risk-based authentication before.

The NSA on the Risks of Exposing Location Data

Post Syndicated from Bruce Schneier original https://www.schneier.com/blog/archives/2020/08/the_nsa_on_the_.html

The NSA has issued an advisory on the risks of location data.

Mitigations reduce, but do not eliminate, location tracking risks in mobile devices. Most users rely on features disabled by such mitigations, making such safeguards impractical. Users should be aware of these risks and take action based on their specific situation and risk tolerance. When location exposure could be detrimental to a mission, users should prioritize mission risk and apply location tracking mitigations to the greatest extent possible. While the guidance in this document may be useful to a wide range of users, it is intended primarily for NSS/DoD system users.

The document provides a list of mitigation strategies, including turning things off:

If it is critical that location is not revealed for a particular mission, consider the following recommendations:

  • Determine a non-sensitive location where devices with wireless capabilities can be secured prior to the start of any activities. Ensure that the mission site cannot be predicted from this location.
  • Leave all devices with any wireless capabilities (including personal devices) at this non-sensitive location. Turning off the device may not be sufficient if a device has been compromised.
  • For mission transportation, use vehicles without built-in wireless communication capabilities, or turn off the capabilities, if possible.

Of course, turning off your wireless devices is itself a signal that something is going on. It’s hard to be clandestine in our always connected world.

News articles.

The Unintended Harms of Cybersecurity

Post Syndicated from Bruce Schneier original https://www.schneier.com/blog/archives/2020/06/the_unintended_.html

Interesting research: “Identifying Unintended Harms of Cybersecurity Countermeasures“:

Abstract: Well-meaning cybersecurity risk owners will deploy countermeasures (technologies or procedures) to manage risks to their services or systems. In some cases, those countermeasures will produce unintended consequences, which must then be addressed. Unintended consequences can potentially induce harm, adversely affecting user behaviour, user inclusion, or the infrastructure itself (including other services or countermeasures). Here we propose a framework for preemptively identifying unintended harms of risk countermeasures in cybersecurity.The framework identifies a series of unintended harms which go beyond technology alone, to consider the cyberphysical and sociotechnical space: displacement, insecure norms, additional costs, misuse, misclassification, amplification, and disruption. We demonstrate our framework through application to the complex,multi-stakeholder challenges associated with the prevention of cyberbullying as an applied example. Our framework aims to illuminate harmful consequences, not to paralyze decision-making, but so that potential unintended harms can be more thoroughly considered in risk management strategies. The framework can support identification and preemptive planning to identify vulnerable populations and preemptively insulate them from harm. There are opportunities to use the framework in coordinating risk management strategy across stakeholders in complex cyberphysical environments.

Security is always a trade-off. I appreciate work that examines the details of that trade-off.

COVID-19 Risks of Flying

Post Syndicated from Bruce Schneier original https://www.schneier.com/blog/archives/2020/06/covid_risks_of_.html

I fly a lot. Over the past five years, my average speed has been 32 miles an hour. That all changed mid-March. It’s been 105 days since I’ve been on an airplane — longer than any other time in my adult life — and I have no future flights scheduled. This is all a prelude to saying that I have been paying a lot of attention to the COVID-related risks of flying.

We know a lot more about how COVID-19 spreads than we did in March. The “less than six feet, more than ten minutes” model has given way to a much more sophisticated model involving airflow, the level of virus in the room, and the viral load in the person who might be infected.

Regarding airplanes specifically: on the whole, they seem safer than many other group activities. Of all the research about contact tracing results I have read, I have seen no stories of a sick person on an airplane infecting other passengers. There are no superspreader events involving airplanes. (That did happen with SARS.) It seems that the airflow inside the cabin really helps.

Airlines are trying to make things better: blocking middle seats, serving less food and drink, trying to get people to wear masks. (This video is worth watching.) I’ve started to see airlines requiring masks and banning those who won’t, and not just strongly encouraging them. (If mask wearing is treated the same as the seat belt wearing, it will make a huge difference.) Finally, there are a lot of dumb things that airlines are doing.

This article interviewed 511 epidemiologists, and the general consensus was that flying is riskier than getting a haircut but less risky than eating in a restaurant. I think that most of the risk is pre-flight, in the airport: crowds at the security checkpoints, gates, and so on. And that those are manageable with mask wearing and situational awareness. So while I am not flying yet, I might be willing to soon. (It doesn’t help that I get a -1 on my COVID saving throw for type A blood, and another -1 for male pattern baldness. On the other hand, I think I get a +3 Constitution bonus. Maybe, instead of sky marshals we can have high-level clerics on the planes.)

And everyone: wear a mask, and wash your hands.

EDITED TO ADD (6/27): Airlines are starting to crowd their flights again.

On Cyber Warranties

Post Syndicated from Bruce Schneier original https://www.schneier.com/blog/archives/2020/03/on_cyber_warran.html

Interesting article discussing cyber-warranties, and whether they are an effective way to transfer risk (as envisioned by Ackerlof’s “market for lemons”) or a marketing trick.

The conclusion:

Warranties must transfer non-negligible amounts of liability to vendors in order to meaningfully overcome the market for lemons. Our preliminary analysis suggests the majority of cyber warranties cover the cost of repairing the device alone. Only cyber-incident warranties cover first-party costs from cyber-attacks — why all such warranties were offered by firms selling intangible products is an open question. Consumers should question whether warranties can function as a costly signal when narrow coverage means vendors accept little risk.

Worse still, buyers cannot compare across cyber-incident warranty contracts due to the diversity of obligations and exclusions. Ambiguous definitions of the buyer’s obligations and excluded events create uncertainty over what is covered. Moving toward standardized terms and conditions may help consumers, as has been pursued in cyber insurance, but this is in tension with innovation and product diversity.


Theoretical work suggests both the breadth of the warranty and the price of a product determine whether the warranty functions as a quality signal. Our analysis has not touched upon the price of these products. It could be that firms with ineffective products pass the cost of the warranty on to buyers via higher prices. Future studies could analyze warranties and price together to probe this issue.

In conclusion, cyber warranties — particularly cyber-product warranties — do not transfer enough risk to be a market fix as imagined in Woods. But this does not mean they are pure marketing tricks either. The most valuable feature of warranties is in preventing vendors from exaggerating what their products can do. Consumers who read the fine print can place greater trust in marketing claims so long as the functionality is covered by a cyber-incident warranty.

Andy Ellis on Risk Assessment

Post Syndicated from Bruce Schneier original https://www.schneier.com/blog/archives/2019/12/andy_ellis_on_r.html

Andy Ellis, the CSO of Akamai, gave a great talk about the psychology of risk at the Business of Software conference this year.

I’ve written about this before.

One quote of mine: “The problem is our brains are intuitively suited to the sorts of risk management decisions endemic to living in small family groups in the East African highlands in 100,000 BC, and not to living in the New York City of 2008.”

EDITED TO ADD (12/13): Epigenetics and the human brain.

NSA on the Future of National Cybersecurity

Post Syndicated from Bruce Schneier original https://www.schneier.com/blog/archives/2019/10/nsa_on_the_futu.html

Glenn Gerstell, the General Counsel of the NSA, wrote a long and interesting op-ed for the New York Times where he outlined a long list of cyber risks facing the US.

There are four key implications of this revolution that policymakers in the national security sector will need to address:

The first is that the unprecedented scale and pace of technological change will outstrip our ability to effectively adapt to it. Second, we will be in a world of ceaseless and pervasive cyberinsecurity and cyberconflict against nation-states, businesses and individuals. Third, the flood of data about human and machine activity will put such extraordinary economic and political power in the hands of the private sector that it will transform the fundamental relationship, at least in the Western world, between government and the private sector. Finally, and perhaps most ominously, the digital revolution has the potential for a pernicious effect on the very legitimacy and thus stability of our governmental and societal structures.

He then goes on to explain these four implications. It’s all interesting, and it’s the sort of stuff you don’t generally hear from the NSA. He talks about technological changes causing social changes, and the need for people who understand that. (Hooray for public-interest technologists.) He talks about national security infrastructure in private hands, at least in the US. He talks about a massive geopolitical restructuring — a fundamental change in the relationship between private tech corporations and government. He talks about recalibrating the Fourth Amendment (of course).

The essay is more about the problems than the solutions, but there is a bit at the end:

The first imperative is that our national security agencies must quickly accept this forthcoming reality and embrace the need for significant changes to address these challenges. This will have to be done in short order, since the digital revolution’s pace will soon outstrip our ability to deal with it, and it will have to be done at a time when our national security agencies are confronted with complex new geopolitical threats.

Much of what needs to be done is easy to see — developing the requisite new technologies and attracting and retaining the expertise needed for that forthcoming reality. What is difficult is executing the solution to those challenges, most notably including whether our nation has the resources and political will to effect that solution. The roughly $60 billion our nation spends annually on the intelligence community might have to be significantly increased during a time of intense competition over the federal budget. Even if the amount is indeed so increased, spending additional vast sums to meet the challenges in an effective way will be a daunting undertaking. Fortunately, the same digital revolution that presents these novel challenges also sometimes provides the new tools (A.I., for example) to deal with them.

The second imperative is we must adapt to the unavoidable conclusion that the fundamental relationship between government and the private sector will be greatly altered. The national security agencies must have a vital role in reshaping that balance if they are to succeed in their mission to protect our democracy and keep our citizens safe. While there will be good reasons to increase the resources devoted to the intelligence community, other factors will suggest that an increasing portion of the mission should be handled by the private sector. In short, addressing the challenges will not necessarily mean that the national security sector will become massively large, with the associated risks of inefficiency, insufficient coordination and excessively intrusive surveillance and data retention.

A smarter approach would be to recognize that as the capabilities of the private sector increase, the scope of activities of the national security agencies could become significantly more focused, undertaking only those activities in which government either has a recognized advantage or must be the only actor. A greater burden would then be borne by the private sector.

It’s an extraordinary essay, less for its contents and more for the speaker. This is not the sort of thing the NSA publishes. The NSA doesn’t opine on broad technological trends and their social implications. It doesn’t publicly try to predict the future. It doesn’t philosophize for 6000 unclassified words. And, given how hard it would be to get something like this approved for public release, I am left to wonder what the purpose of the essay is. Is the NSA trying to lay the groundwork for some policy initiative ? Some legislation? A budget request? What?

Charlie Warzel has a snarky response. His conclusion about the purpose:

He argues that the piece “is not in the spirit of forecasting doom, but rather to sound an alarm.” Translated: Congress, wake up. Pay attention. We’ve seen the future and it is a sweaty, pulsing cyber night terror. So please give us money (the word “money” doesn’t appear in the text, but the word “resources” appears eight times and “investment” shows up 11 times).

Susan Landau has a more considered response, which is well worth reading. She calls the essay a proposal for a moonshot (which is another way of saying “they want money”). And she has some important pushbacks on the specifics.

I don’t expect the general counsel and I will agree on what the answers to these questions should be. But I strongly concur on the importance of the questions and that the United States does not have time to waste in responding to them. And I thank him for raising these issues in so public a way.

I agree with Landau.

Slashdot thread.

On Cybersecurity Insurance

Post Syndicated from Bruce Schneier original https://www.schneier.com/blog/archives/2019/09/on_cybersecurit.html

Good paper on cybersecurity insurance: both the history and the promise for the future. From the conclusion:

Policy makers have long held high hopes for cyber insurance as a tool for improving security. Unfortunately, the available evidence so far should give policymakers pause. Cyber insurance appears to be a weak form of governance at present. Insurers writing cyber insurance focus more on organisational procedures than technical controls, rarely include basic security procedures in contracts, and offer discounts that only offer a marginal incentive to invest in security. However, the cost of external response services is covered, which suggests insurers believe ex-post responses to be more effective than ex-ante mitigation. (Alternatively, they can more easily translate the costs associated with ex-post responses into manageable claims.)

The private governance role of cyber insurance is limited by market dynamics. Competitive pressures drive a race-to-the-bottom in risk assessment standards and prevent insurers including security procedures in contracts. Policy interventions, such as minimum risk assessment standards, could solve this collective action problem. Policy-holders and brokers could also drive this change by looking to insurers who conduct rigorous assessments. Doing otherwise ensures adverse selection and moral hazard will increase costs for firms with responsible security postures. Moving toward standardised risk assessment via proposal forms or external scans supports the actuarial base in the long-term. But there is a danger policyholders will succumb to Goodhart’s law by internalising these metrics and optimising the metric rather than minimising risk. This is particularly likely given these assessments are constructed by private actors with their own incentives. Search-light effects may drive the scores towards being based on what can be measured, not what is important.

EDITED TO ADD (9/11): BoingBoing post.

Risks of Password Managers

Post Syndicated from Bruce Schneier original https://www.schneier.com/blog/archives/2019/06/risks_of_passwo.html

Stuart Schechter writes about the security risks of using a password manager. It’s a good piece, and nicely discusses the trade-offs around password managers: which one to choose, which passwords to store in it, and so on.

My own Password Safe is mentioned. My particular choices about security and risk is to only store passwords on my computer — not on my phone — and not to put anything in the cloud. In my way of thinking, that reduces the risks of a password manager considerably. Yes, there are losses in convenience.

Excellent Analysis of the Boeing 737 Max Software Problems

Post Syndicated from Bruce Schneier original https://www.schneier.com/blog/archives/2019/04/excellent_analy.html

This is the best analysis of the software causes of the Boeing 737 MAX disasters that I have read.

Technically this is safety and not security; there was no attacker. But the fields are closely related and there are a lot of lessons for IoT security — and the security of complex socio-technical systems in general — in here.

EDITED TO ADD (4/30): A rebuttal of sorts.

Access Now Is Looking for a Chief Security Officer

Post Syndicated from Bruce Schneier original https://www.schneier.com/blog/archives/2018/10/access_now_is_l.html

The international digital human rights organization Access Now (I am on the board) is looking to hire a Chief Security Officer.

I believe that, somewhere, there is a highly qualified security person who has had enough of corporate life and wants instead to make a difference in the world. If that’s you, please consider applying.

Nicholas Weaver on Cryptocurrencies

Post Syndicated from Bruce Schneier original https://www.schneier.com/blog/archives/2018/07/nicholas_weaver_2.html

This is well-worth reading (non-paywalled version). Here’s the opening:

Cryptocurrencies, although a seemingly interesting idea, are simply not fit for purpose. They do not work as currencies, they are grossly inefficient, and they are not meaningfully distributed in terms of trust. Risks involving cryptocurrencies occur in four major areas: technical risks to participants, economic risks to participants, systemic risks to the cryptocurrency ecosystem, and societal risks.

I haven’t written much about cryptocurrencies, but I share Weaver’s skepticism.

Some quick thoughts on the public discussion regarding facial recognition and Amazon Rekognition this past week

Post Syndicated from Dr. Matt Wood original https://aws.amazon.com/blogs/aws/some-quick-thoughts-on-the-public-discussion-regarding-facial-recognition-and-amazon-rekognition-this-past-week/

We have seen a lot of discussion this past week about the role of Amazon Rekognition in facial recognition, surveillance, and civil liberties, and we wanted to share some thoughts.

Amazon Rekognition is a service we announced in 2016. It makes use of new technologies – such as deep learning – and puts them in the hands of developers in an easy-to-use, low-cost way. Since then, we have seen customers use the image and video analysis capabilities of Amazon Rekognition in ways that materially benefit both society (e.g. preventing human trafficking, inhibiting child exploitation, reuniting missing children with their families, and building educational apps for children), and organizations (enhancing security through multi-factor authentication, finding images more easily, or preventing package theft). Amazon Web Services (AWS) is not the only provider of services like these, and we remain excited about how image and video analysis can be a driver for good in the world, including in the public sector and law enforcement.

There have always been and will always be risks with new technology capabilities. Each organization choosing to employ technology must act responsibly or risk legal penalties and public condemnation. AWS takes its responsibilities seriously. But we believe it is the wrong approach to impose a ban on promising new technologies because they might be used by bad actors for nefarious purposes in the future. The world would be a very different place if we had restricted people from buying computers because it was possible to use that computer to do harm. The same can be said of thousands of technologies upon which we all rely each day. Through responsible use, the benefits have far outweighed the risks.

Customers are off to a great start with Amazon Rekognition; the evidence of the positive impact this new technology can provide is strong (and growing by the week), and we’re excited to continue to support our customers in its responsible use.

-Dr. Matt Wood, general manager of artificial intelligence at AWS

Cryptocurrency Security Challenges

Post Syndicated from Roderick Bauer original https://www.backblaze.com/blog/cryptocurrency-security-challenges/

Physical coins representing cyrptocurrencies

Most likely you’ve read the tantalizing stories of big gains from investing in cryptocurrencies. Someone who invested $1,000 into bitcoins five years ago would have over $85,000 in value now. Alternatively, someone who invested in bitcoins three months ago would have seen their investment lose 20% in value. Beyond the big price fluctuations, currency holders are possibly exposed to fraud, bad business practices, and even risk losing their holdings altogether if they are careless in keeping track of the all-important currency keys.

It’s certain that beyond the rewards and risks, cryptocurrencies are here to stay. We can’t ignore how they are changing the game for how money is handled between people and businesses.

Some Advantages of Cryptocurrency

  • Cryptocurrency is accessible to anyone.
  • Decentralization means the network operates on a user-to-user (or peer-to-peer) basis.
  • Transactions can completed for a fraction of the expense and time required to complete traditional asset transfers.
  • Transactions are digital and cannot be counterfeited or reversed arbitrarily by the sender, as with credit card charge-backs.
  • There aren’t usually transaction fees for cryptocurrency exchanges.
  • Cryptocurrency allows the cryptocurrency holder to send exactly what information is needed and no more to the merchant or recipient, even permitting anonymous transactions (for good or bad).
  • Cryptocurrency operates at the universal level and hence makes transactions easier internationally.
  • There is no other electronic cash system in which your account isn’t owned by someone else.

On top of all that, blockchain, the underlying technology behind cryptocurrencies, is already being applied to a variety of business needs and itself becoming a hot sector of the tech economy. Blockchain is bringing traceability and cost-effectiveness to supply-chain management — which also improves quality assurance in areas such as food, reducing errors and improving accounting accuracy, smart contracts that can be automatically validated, signed and enforced through a blockchain construct, the possibility of secure, online voting, and many others.

Like any new, booming marketing there are risks involved in these new currencies. Anyone venturing into this domain needs to have their eyes wide open. While the opportunities for making money are real, there are even more ways to lose money.

We’re going to cover two primary approaches to staying safe and avoiding fraud and loss when dealing with cryptocurrencies. The first is to thoroughly vet any person or company you’re dealing with to judge whether they are ethical and likely to succeed in their business segment. The second is keeping your critical cryptocurrency keys safe, which we’ll deal with in this and a subsequent post.

Caveat Emptor — Buyer Beware

The short history of cryptocurrency has already seen the demise of a number of companies that claimed to manage, mine, trade, or otherwise help their customers profit from cryptocurrency. Mt. Gox, GAW Miners, and OneCoin are just three of the many companies that disappeared with their users’ money. This is the traditional equivalent of your bank going out of business and zeroing out your checking account in the process.

That doesn’t happen with banks because of regulatory oversight. But with cryptocurrency, you need to take the time to investigate any company you use to manage or trade your currencies. How long have they been around? Who are their investors? Are they affiliated with any reputable financial institutions? What is the record of their founders and executive management? These are all important questions to consider when evaluating a company in this new space.

Would you give the keys to your house to a service or person you didn’t thoroughly know and trust? Some companies that enable you to buy and sell currencies online will routinely hold your currency keys, which gives them the ability to do anything they want with your holdings, including selling them and pocketing the proceeds if they wish.

That doesn’t mean you shouldn’t ever allow a company to keep your currency keys in escrow. It simply means that you better know with whom you’re doing business and if they’re trustworthy enough to be given that responsibility.

Keys To the Cryptocurrency Kingdom — Public and Private

If you’re an owner of cryptocurrency, you know how this all works. If you’re not, bear with me for a minute while I bring everyone up to speed.

Cryptocurrency has no physical manifestation, such as bills or coins. It exists purely as a computer record. And unlike currencies maintained by governments, such as the U.S. dollar, there is no central authority regulating its distribution and value. Cryptocurrencies use a technology called blockchain, which is a decentralized way of keeping track of transactions. There are many copies of a given blockchain, so no single central authority is needed to validate its authenticity or accuracy.

The validity of each cryptocurrency is determined by a blockchain. A blockchain is a continuously growing list of records, called “blocks”, which are linked and secured using cryptography. Blockchains by design are inherently resistant to modification of the data. They perform as an open, distributed ledger that can record transactions between two parties efficiently and in a verifiable, permanent way. A blockchain is typically managed by a peer-to-peer network collectively adhering to a protocol for validating new blocks. Once recorded, the data in any given block cannot be altered retroactively without the alteration of all subsequent blocks, which requires collusion of the network majority. On a scaled network, this level of collusion is impossible — making blockchain networks effectively immutable and trustworthy.

Blockchain process

The other element common to all cryptocurrencies is their use of public and private keys, which are stored in the currency’s wallet. A cryptocurrency wallet stores the public and private “keys” or “addresses” that can be used to receive or spend the cryptocurrency. With the private key, it is possible to write in the public ledger (blockchain), effectively spending the associated cryptocurrency. With the public key, it is possible for others to send currency to the wallet.

What is a cryptocurrency address?

Cryptocurrency “coins” can be lost if the owner loses the private keys needed to spend the currency they own. It’s as if the owner had lost a bank account number and had no way to verify their identity to the bank, or if they lost the U.S. dollars they had in their wallet. The assets are gone and unusable.

The Cryptocurrency Wallet

Given the importance of these keys, and lack of recourse if they are lost, it’s obviously very important to keep track of your keys.

If you’re being careful in choosing reputable exchanges, app developers, and other services with whom to trust your cryptocurrency, you’ve made a good start in keeping your investment secure. But if you’re careless in managing the keys to your bitcoins, ether, Litecoin, or other cryptocurrency, you might as well leave your money on a cafe tabletop and walk away.

What Are the Differences Between Hot and Cold Wallets?

Just like other numbers you might wish to keep track of — credit cards, account numbers, phone numbers, passphrases — cryptocurrency keys can be stored in a variety of ways. Those who use their currencies for day-to-day purchases most likely will want them handy in a smartphone app, hardware key, or debit card that can be used for purchases. These are called “hot” wallets. Some experts advise keeping the balances in these devices and apps to a minimal amount to avoid hacking or data loss. We typically don’t walk around with thousands of dollars in U.S. currency in our old-style wallets, so this is really a continuation of the same approach to managing spending money.

Bread mobile app screenshot

A “hot” wallet, the Bread mobile app

Some investors with large balances keep their keys in “cold” wallets, or “cold storage,” i.e. a device or location that is not connected online. If funds are needed for purchases, they can be transferred to a more easily used payment medium. Cold wallets can be hardware devices, USB drives, or even paper copies of your keys.

Trezor hardware wallet

A “cold” wallet, the Trezor hardware wallet

Ledger Nano S hardware wallet

A “cold” wallet, the Ledger Nano S

Bitcoin paper wallet

A “cold” Bitcoin paper wallet

Wallets are suited to holding one or more specific cryptocurrencies, and some people have multiple wallets for different currencies and different purposes.

A paper wallet is nothing other than a printed record of your public and private keys. Some prefer their records to be completely disconnected from the internet, and a piece of paper serves that need. Just like writing down an account password on paper, however, it’s essential to keep the paper secure to avoid giving someone the ability to freely access your funds.

How to Keep your Keys, and Cryptocurrency Secure

In a post this coming Thursday, Securing Your Cryptocurrency, we’ll discuss the best strategies for backing up your cryptocurrency so that your currencies don’t become part of the millions that have been lost. We’ll cover the common (and uncommon) approaches to backing up hot wallets, cold wallets, and using paper and metal solutions to keeping your keys safe.

In the meantime, please tell us of your experiences with cryptocurrencies — good and bad — and how you’ve dealt with the issue of cryptocurrency security.

The post Cryptocurrency Security Challenges appeared first on Backblaze Blog | Cloud Storage & Cloud Backup.