Srinagar, Jul 19 (KNO): A Kashmir-based crypto enthusiast, Mutahir Showkat, has sounded the alarm about the dangers of storing cryptocurrency on centralised exchanges after the recent $230 million hack at WazirX.
In an interview with the news agency—Kashmir News Observer (KNO), Mutahir said there is a need for crypto users to prioritise security and consider decentralised storage options.
Mutahir, founder of Clout Scoop, highlighted the risks associated with keeping large sums of cryptocurrency on centralised platforms.
"The WazirX hack is a stark reminder of the vulnerabilities that exist within centralised exchanges," he said, adding that despite their convenience, these platforms are attractive targets for hackers due to the vast amounts of funds they hold.
The hack at WazirX, one of India's leading crypto exchanges, involved the compromise of a multisig wallet and the theft of over $100 million worth of Shiba Inu (SHIB) tokens, $52 million in Ether (ETH), and $11 million in Matic (MATIC). The hacker used on-chain exchanges like Uniswap to convert these assets, making recovery efforts more challenging.
Showkat advocated for the use of decentralised wallets, particularly hardware wallets, for storing cryptocurrency. "Decentralised wallets provide users with full control over their private keys, which significantly reduces the risk of theft," he said, adding that hardware wallets, which store private keys offline, offer the highest level of security.
He elaborated on how hardware wallets work: “Using a hardware wallet involves creating a private-public key pair and storing the private key on a physical device. Transactions must be signed using this device, ensuring that the private key never leaves the wallet. This method is immune to online hacks and malware, making it the most secure option for long-term storage of cryptocurrency.”
While centralised exchanges are necessary for trading and transactions, Mutahir advised moving significant holdings to more secure storage solutions. “The WazirX hack shows that even with advanced security measures, centralized platforms remain vulnerable. Investors should use decentralized wallets for their long-term holdings to mitigate these risks,” he said.
The WazirX breach has sent shockwaves through the crypto community, but it also serves as a valuable lesson. By understanding the risks and taking proactive steps to safeguard their assets, users can navigate the crypto world with greater security. Decentralised wallets and hardware wallets represent the best defense against cyber attacks, ensuring that investors maintain control over their financial future.
Mutahir Showkat called for action for the crypto community, saying, “We must prioritise security in our approach to managing digital assets. The decentralised nature of cryptocurrency is its strength, and we should leverage this by using decentralised wallets to protect our investments."—(KNO)