Cryptocurrency wallets are like the leather wallets some of us still use in real life for carrying cash and a series of credit cards. But there are other things that a cryptocurrency wallet can do, for instance storing hundreds of digital currencies without worrying about ever running out of space, checking balance and keeping tracks of transaction details. It’s even more secured than a normal wallet by providing a private key that only you can access your digital assets. All you have to do is to keep this private key safe. Sounds great right? But what if attackers can steal your private key or hack the wallet itself?
More and more people are joining the realm of bitcoin or cryptocurrency each day. Therefore, there’s a growing demand to access, store, send, receive and track digital currency holdings effectively and securely. While storing our money on the exchanges is too vulnerable to hacker – Mt. Gox is the most epic bitcoin hack that around $400 million got lost and unable to refund to its investors, moving your money to your private wallet seems like a better option. However, security is its significant challenge.
There are several kinds of wallets that provide different ways to store and access your digital currency. You can create one via a web browser, download then install it to your desktop, smartphone or purchase a physical one from an online store. No matter what wallet we use, user authentication is required when logging into web and digital applications and platforms and that’s where hackers and imposters can take advantage of. If you’re using desktop wallets, someone may hack into your computer and make coin transaction from your wallet to theirs by taking possession of the passwords. Even with hardware wallet which is considered to deliver higher security, users need to enter a PIN code before making transaction. There are already reports on attacks on web, mobile and desktop wallets.
Instead of password, PIN and digital dot patterns, researchers agree that biometric authentication achieves a higher level of security. Having it protected by biometrics on access control base, cryptocurrency users can extend the security of crypto wallets and secure their information on the storage. Users need to initially enroll their biometric data on the installation of the wallet. Later on, they must verify their fingerprint, face or iris when accessing the device or making every transaction. There are already several companies like BitGo and Yobi wallet that adopted biometrics to provide their customers with advanced security solutions.
We’re living in a fast digital world where convenience and mobility are also important traits besides security. Bitcoin has gradually accepted in retail purchasing and using mobile wallet would definitely give you the desired convenience and mobility. Moreover, most smartphones now have built-in biometric scan which can be used effectively for user authentication in cryptocurrency systems. Furthermore, biometric enabled mobile devices are being deployed rapidly especially for mobile banking and payment authentication. Research consultancy Acuity Market Intelligence projects annual global mobile biometric market revenues to reach US$34.6 billion by 2020. This figure includes 4.8 billion biometrically-enabled mobile devices generating US$6.2 billion in biometric sensor data revenue from 5.4 billion biometric app downloads.
Every kind of crypto wallet has its pros and cons but security level should be put as the number 1 priority. Using mobile wallet with built-in biometric authentication enabled app can be considered a good option providing both usability and security. Soon crypto wallet will become a hot target for attackers as the cryptocurrency market gets bigger. The quicker we adopt biometric authentication solutions, the safer we will get.