Security for offline transactions with cryptocurrency, tips and tricks

Despite the fact that most transactions are carried out exclusively in the online environment, we cannot avoid live meetings when it is necessary to make a transaction in the offline environment.

There is little focus on the subject of hygiene in the area of security and privacy during face-to-face meetings. This will be discussed in this article.

Counterparty Check

Perhaps the most important point will be to check the counterparty for good faith. If we buy cryptocurrency for fiat money, then the ideal way would be to ask the seller for a link to his account on localbitcoins.net .

As a rule, people who are professionally selling and buying cryptocurrencies have an account in this service, as this is the most proven and popular service in this niche.

Information on all successful and unsuccessful transactions of the counterparty is available on localbitcoins in open form. Agree that the inscription> 1000 successful transactions greatly reduces the risk of failure. It will not be superfluous to make sure that the account is registered for a long time and has passed all possible verification. Be sure to review the number of unsuccessful transactions – this will help to form a full-fledged opinion about the seller.

It is worth considering that the site localbitcoins.net often undergoes phishing attacks. Check the address bar of the browser and do not follow the links in the contextual advertising field of a search engine – the sites of intruders most often appear there.

Cryptocurrency rate

Refrain from transactions during the high volatility of a cryptocurrency. This is especially true if you want to buy some goods for cryptocurrency. One of the unfavorable scenarios is the following: the cryptocurrency rate will drop sharply by the time you buy goods for a crypt, as a result of which you will not have enough funds to make a payment.

On the day of the transaction, monitor the cryptocurrency volatility in which you are going to make the payment:

Come on a deal with a friend

The actual problem, if you go to an unfamiliar place to deal. The two will be psychologically more comfortable and calmer in the new environment. In addition, together it will be easier to notice any suspicious actions of the second side.

Prepare for a deal in advance

If you pay for a product or service for a cryptocurrency, then you need to prepare in advance the appropriate amount in the appropriate currency. It is not necessary to engage in the conversion of the crypt in an unfamiliar environment. Why? We read the following two recommendations.

Do not carry a laptop

Working with a laptop in an incomprehensible room is fraught with the compromise of many personal data from your balance, addresses, passwords, PIN codes or code phrases that are entered via the keyboard. You cannot be sure that there are no hidden cameras installed in the room that can be sent to pre-prepared places.

It is especially important to take into account that a compromised large balance of funds may be the cause of an attack with a wrench ($ 5 wrench attack), that is, directly by physical pressure.

Do not shine hardware wallet

A hardware wallet can serve as a signal that you have significant funds in the cryptocurrency, otherwise why should you start it. It is also worth considering that when making a transaction, you enter a PIN code from a hardware wallet, which can be easily compromised.

After the transaction, the second party may initiate the theft of the hardware wallet and all the assets it contains. And do not forget about the attack with a wrench, it will be very appropriate in this case.

Wait for confirmation in the desired number of blocks.

This item especially applies to transactions that are made with Bitcoin, since the inclusion of your transaction in the block can take an hour or more. Why do I have to wait for confirmation in 3-6 blocks?

The fact is that during the purchase of cryptocurrency, the formation of two chains of the blockchain is possible, when two mining pools will compete with each other and continue to build their version of the blockchain. In one chain may be your transaction, and in another it may be missing. If the mining pool that builds the second chain is able to get ahead of the first one, then according to the rules of the Bitcoin protocol, the entire network will automatically switch to it. And that means your transaction will be canceled.

That is why it is worth waiting for confirmation in several blocks. The more confirmations you wait, the lower the probability of a blockchain fork. Starting from 6 blocks, this probability starts to tend to zero.

Do not compromise your balance

If you pay for goods or services in cryptocurrency with the UTXO accounting model – Bitcoin, Litecoin, Bitcoin Cash, Dash, etc., when spending $ 100 from an address that contains $ 10,000, you compromise all $ 10,000. Such a transaction will contain one entry at $ 10,000 and two exits — one at $ 100 to the recipient and the second at $ 9,900 in the form of surrender.

For simplicity, this example does not include transaction fees. This means that the recipient of $ 100 will see that you own $ 9,900 and, as a result, will be able to track all further financial transactions at this address. Therefore, before the transaction of $ 100 in advance, prepare a little more than this amount at a separate address.

It would be ideal to skip this amount through the mixer before the transaction to prevent the opportunity to see the history of your previous transactions. If the amount is small, you can use regular mixers, where you trust your money to the service, but if you want to clear a large amount of money, you should use Trustless mixers that mix coins without trust to a third party, which will be discussed in the following recommendation.

Use your mobile wallet

Perhaps the most convenient way would be to use mobile wallets. However, it is worth making a choice in favor of a time-tested and approved by the cryptocurrency community mobile wallet that provides access to private keys. These include Mycelium, Arcbit, Samurai Wallet, Coinomi, Bither, Breadwallet.

Use anonymous cryptocurrency Zec, Monero, Dash.

To preserve confidentiality, you can agree in advance to conduct transactions in these cryptocurrencies. Before that, of course, it’s worth a little to dive into the particular blockchains of these coins, their wallets, address formats, and learn how anonymous transactions are carried out.

Delegate the transaction to a trusted person.

But you can come to a deal without having any chance of spending coins – without Trezor, Ledger, a laptop, a mobile wallet and a laptop, and simply ask a trusted person who will be geographically elsewhere to make a transaction for you.

Summing up

We have listed various recommendations, ranging from the security of cryptocurrency assets and confidentiality to the physical security of the cryptocurrency owner. Scroll through all the likely scenarios in your head and select your checklist for a successful transaction. It is possible that new precautions will appear on your checklist.

And in the online environment, use hardware wallets, which can be purchased at Cryptonist.ru .

The advantages of buying :

• The official representative of Trezor and Bitbox in Russia;
• Test drive any wallet in the office;
• YouTube channel with full reviews on wallets;
• 1 year warranty from the store.

You can make an order and get advice on their website – https://cryptonist.ru

Publication date 04/23/2019
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