What security does Bitcoin offer? Resistance to hacks and computer attacks. Most common scams in Bitcoin. What are initial cryptocurrency offerings.
In a world where more and more information and value are stored in electronic media, attacks on computer security are also becoming increasingly intense. In that context, a decentralized and distributed network like Bitcoin is a solution: this network without a central server can function beyond attacks against its terminals.
On the other hand, cryptocurrencies offer much more resistance to these attacks than other types of securities because the use of cryptography and complex mathematics reduces the vulnerability of users and bitcoins to a minimum, improving protection, security and privacy. By design and code, Bitcoin comes with the solution to several security problems.
Most cryptocurrency vulnerability crises come from usage errors: lost or forgotten keys, accidentally deleted wallets, wrong addresses. When using Bitcoin it is crucial to be clear about not risking beyond the level of knowledge.
Bitcoin was never hacked
Although there were isolated violations of brokers and exchanges, they did not compromise Bitcoin, just as a bank robbery does not mean that the peso is in danger or disappears. In more than ten years, neither Bitcoin nor its ledger were affected by the attacks.
That doesn’t mean they are infallible. But as its use expands, more community members are helping with security as programmers and cryptographers, or by lending processing power to run validation and security protocols.
While blockchain protects Bitcoin operations, users must take security measures.
Scams in Bitcoin and other cryptocurrencies
Aside from scams affecting other securities, bitcoin users can fall prey to more specific deceptions and frauds. Since it is not a regulated network, there is no one to make complaints or claims to in Bitcoin, and furthermore, the operations are irreversible.
These are sufficient reasons to take extreme care when operating, and ensure that no one runs away with the money without handing over the BTC, or has access to the keys to impersonate an identity. In that sense, brokers offer a safer buying and selling platform. And also many exchanges use rating and reputation systems for users.
Initial cryptocurrency offerings
New cryptocurrencies are created all the time. When a software project or crypto startup is announced, it raises funds by creating its token and selling it. In these “initial coin offerings” (or ICOs), buyers bet that the project will grow and their crypto will appreciate in value. But since anyone can launch an ICO, fake ICO scams are among the most common. If an ICO interests you, you should research it thoroughly.
Privacy in Bitcoin
What public records does Bitcoin keep. Why it is transparent, anonymous and neutral. Who controls the operations. The risk of identity theft.
Bitcoin was designed for people to transfer value with greater privacy, but the use of bitcoins still generates public records, since transactions are recorded on the blockchain. What remains private is information about users.
But although when exploring the accounting chain you do not see names, documents or geographical references, Bitcoin is still not completely anonymous. If someone uses the same address every time, it becomes evident that these transactions are carried out by the same person. Thus that pseudonym, that bitcoin address, loses part of its private nature. The thing is that whoever knows the identity behind it will be able to track all the operations carried out.
Transaction control
Transactions between people and on exchanges are directly controlled by Bitcoin users. This not only means that no government or financial institution can interfere but also that no seller can force unreported charges.
With a wide variety of services where you can operate with crypto (brokers, exchanges, peer-to-peer), with Bitcoin users can decide how much, when, how and where to buy. With few exceptions, no one needs to be informed about why they do it or who they are.
The Bitcoin accounting network is not interested in the identity of the operator or the reasons why they transfer value.
Transparency, resilience and net neutrality
The ultimate element of Bitcoin’s resilience is the blockchain, where transactions are recorded and new bitcoins are created from mining. All information about bitcoin supply is available there for anyone who wants to check and use it.
Since each block is chained to the previous one and the next, making changes is extremely complex. The older a transaction is, the more difficult it is to adulterate it. Mining makes it exponentially more difficult to reverse past transactions.
In addition, mining, the existence of a distributed ledger and the calculations established in the blockchain prevent a person or group from gathering sufficient computing power to modify the chain, block transactions or falsify bitcoins or user identities.
Identity fraud
Like other computer networks, Bitcoin is the target of numerous phishing attempts. While the network takes precautions, users must also take responsibility, always ensuring that they operate on the correct websites and protecting their devices, passwords, funds, credentials and login data.
