The trend of digital currency is booming globally, and its growth rate expected to be increased by approximately 18% between 2018-2023. According to a report of Report Linker, the expected turnover of digital currency will reach $87 billion by the end of 2023. Basically, there are two types of digital money – Virtual currency and Cryptocurrency. With an 82.70% rate of investment, Bitcoin was the highly invested digital cryptocurrency in 2019. By reading the above stats, we can say that the trend of Bitcoin is spreading like wildfire so, Bitcoin wallet app security is also essential.
In this post, we will cover some of the essential steps, features, and tips to keep your Bitcoin wallet app secure. But, before we go in-depth with Bitcoin wallet app security, let us understand the concepts related to Bitcoin and Bitcoin wallet.
Introduction to Bitcoin and Bitcoin Wallet
Bitcoin is a decentralized digital cryptocurrency based on a cryptographic system. Bitcoin currency can be transferred from user to user on the peer-to-peer bitcoin network, and it does not require any intermediate for the same. On the other hand, a Bitcoin wallet is a software application used to store Bitcoins. Technically, Bitcoins are not stored anywhere, but there is a confidential pin that is given to the owner of the Bitcoin wallet. The wallet owner needs to use that pin to make transactions, and such kinds of pin codes are set for every Bitcoin address saved in the Bitcoin wallet. Moreover, the Bitcoin wallets come in four primary categories; desktop, mobile, web, and hardware.
Understanding Bitcoin Wallets
As we have mentioned above, there are four types of Bitcoin wallets, i.e., desktop, mobile, web, and hardware. Now let us discuss each category one by one.
Desktop Wallets: It gives complete control of the wallet to the user. Desktop wallets also allow users to create a Bitcoin address in order to send and receive Bitcoins. Moreover, Bitcoin Core, Hive OS X, Electrum, etc. are some of the known desktop wallets.
Mobile Wallets: Mobile wallets overwhelm the hindrance of desktop wallets. Mobile wallets can perform all the functions of a desktop wallet, and users can run the mobile wallets in their smartphones. These wallets add-ons more convenience, as users can directly make transactions by using their mobile wallets in their smartphones. Moreover, users can also pay at the physical store by using touch-to-pay” via NFC scanning a QR code.
Web Wallets: This type of Bitcoin wallet enables users to use Bitcoins on any online browsing platform. But, the selection of your web wallet should be sound enough, as it saves the user’s confidential pin online. Coinbase and Blockchain are some of the most popular Bitcoin web wallets.
Hardware Wallets: Hardware wallets are considered as one of the highly secure types of Bitcoin wallets. Users can connect these Bitcoin wallets to the computer by using a USB data port. Moreover, this type of Bitcoin wallet is safe from virus attacks.
Why Is Bitcoin Wallet App Security Important?
No doubt, it is very much essential to keep your Bitcoin wallet safe, as Bitcoin wallets are high-value targets for the hackers nowadays. Now the question arises – how can you keep your Bitcoin wallet safe? Well, there are numerous safeguard steps and tips that you can implement to keep your Bitcoin wallet away from the danger of hacking, such as strong password protection, offline data storing, and more.
Tips To Keep Your Bitcoin Wallet Safe
If you have a couple of Bitcoins, then obviously you would like to improve their security as well, as Bitcoin wallets are a primary target for hackers nowadays. However, it isn’t very easy to protect a virtual wallet, but it isn’t impossible. The following guide will help you to keep your Bitcoin wallet safe and secure:
1. Keep a Limited Amount of Bitcoins in Wallet
If you have a Bitcoin wallet, it will be useful if you would not keep all the money in it, whether it is a physical wallet or a virtual one. Therefore, you should store only a limited amount of Bitcoins in your wallet to reduce the risk of hacking.
2. Passcode the Bitcoin Wallet
Encrypting your Bitcoin wallet attaches an additional layer of security to your Bitcoin wallet. By including a passcode in your Bitcoin wallet, you can easily encrypt your virtual wallet. It not only provides more protection to your Bitcoin wallet but also makes it harder for hackers to hack your wallet. On the other hand, if you operate your Bitcoin wallet on your smartphone or desktop, then it is much more essential to encrypt your virtual wallet.
3. Use the Latest Bitcoin Wallet Software
If you want to keep your Bitcoin wallet safe and secure, you need to keep your Bitcoin software updated, as it is one of the most common security measures. You can improve the security of your Bitcoin wallet by using the latest version of the Bitcoin software. Apart from safety, it also keeps you updated with the latest security fixes and protects your wallet features. On the other hand, if the software of your Bitcoin wallet is not updated, you can be an easy target for hackers.
4. Backup Your Bitcoin Wallet
According to experts, you should create a backup of your Bitcoin wallet to fight against various online hacks, computer failures, and human errors. This can only be possible if you keep your Bitcoins in the cold storage and keep a small number of Bitcoins in the wallet for the sake of trading. Moreover, if you create a regular backup for your Bitcoin wallet, you can quickly recover your wallet if you lost your mobile or desktop.
Security Features to Code Your Bitcoin Wallet
The app should be secure enough to keep your coins safe because when it comes to financial apps, security should be the priority. Following are some of the safety features that can help code your bitcoin wallet:
1. Two-Factor Authentication
Nowadays, cracking simple passwords is not a big deal for hackers. Now the question arises – how do you protect your Bitcoin wallet? Well, the password process needs to be upgraded with two-factor or multifactor authentication. Undoubtedly, it will provide a thick security layer to the Bitcoin wallet.
2. Timed Logout
Timed logout is the next big thing when it comes to the safety features of a Bitcoin wallet. Financial apps need to be enriched with the timed logout feature, as it an essential safety feature for a prosperous cryptocurrency wallet app. Also, it improves the Bitcoin wallet app on the scale of security.
3. Deny Repeated Transactions
Generally, every month people make the same amount of transactions, and traditional financial apps allow the users to perform repeat transactions. In this scenario, hackers can make fraud, as they can easily hack their wallets to make the same transaction again. So, it will be good if the wallet software does not allow repeat transactions, as it reduces the fraud risk to a greater extent.
Brief Overview of Statistics
According to a report conducted by Statista, 23.95 million people all around the globe use Cryptocurrency wallets, which mean approximately 85.80%, and this number increased by 11.34% more in a limited period of time. No doubt, Cryptocurrency wallets are trending, and they contain keys to the monetary value of their users. So, they need to be extensively secure and functionally tested.
In the year 2015, Bitcoin comes to the spotlight at first, and it got a great response from online merchants and resellers, as they use Bitcoins to buy goods and services. Along with time, Bitcoin has become an accessible, reliable, and exotic online currency. Presently, you can use Bitcoins for a variety of purposes, such as buying electronic items, physical goods, hotel bookings, etc.
As you can see, the use of Bitcoins is rapidly taking space in the market, so the Bitcoin wallets need to be correctly tested to ensure wallet quality. Before we talk about testing steps in the Bitcoin wallet, you should know what’s going on in the testing world.
How to Test Bitcoin Wallet Apps?
Nowadays, most of the developers use blockchain API to develop mobile apps that can satisfy the needs of Bitcoin users. Moreover, if you want your Bitcoin wallet to meet the high standards of cryptography, you need to take the testing process seriously. Now let us discuss some of the testing steps that can help you meet the high standards of cryptography.
Bitcoin wallet holds real money so, you cannot perform its testing in production. In this scenario, you can go with the Testnet. The primary purpose of Testnet is to find all the loopholes of an app designed for the use of Bitcoin. Moreover, the transactions initiated on Testnet do not affect the financial value of bitcoins on the mainnet (primary network for Bitcoin transactions).
In some cases, Testnet does not fulfill the testing requirements. In that case, blocks are mined every 10 minutes, and you cannot boost up the process. So, if you want Bitcoins to be mined faster, you should go with the Regression Testing. It gives you complete control over the testing environment so that you can generate bitcoins as per your need by running regmode.
Security is the main regard when it comes to the testing of financial apps. The main aim of testing Bitcoin wallet apps is to examine the blockchain verification and make sure that the basic transaction structure is secure.
Bitcoin Wallet App Vulnerability Analysis
Basically, there are two main approaches when it comes to the vulnerability analysis of the Bitcoin Wallet App.
Static Method of Analysis
- Reverse Engineering
- Manual/Automatic Source Code Analysis
Dynamic Method of Analysis
- Network Traffic Monitoring
- Runtime Analysis
- File Activity Analysis
Importance of Manual Testing
Manual testing is also essential to reduce the risks concerning the device’s software and inaccurate structure of automation testing scripts. The following are some of the aspects that you should keep in your consideration while testing Bitcoin wallet apps manually.
- Jailbreak detection
- Device platform backdoor
Server Side Security
- Server configuration errors
- Loopholes in server code
- Insecure storage of sensitive data on mobile devices
- Insecure use of cryptography
- SQL Injection termination
- Weak Session management
Mobile Network/Wi-Fi Connection Security
- Encrypted signal verification
- SSL encrypted connections
- Service proxy setting protection
If your Bitcoin wallet lack in terms of security, then your wallet can be a prime target for the hackers. Moreover, you can lose your Bitcoins if you do not have a healthy backup plan for the security of your Bitcoin wallet. Taking a bit of time in reading the information mentioned above can be proven fruitful for the protection of your Bitcoin wallet.