Major cryptocurrency exchanges are frequently hacked. Even major virtual currency exchanges are in this situation, so some people may feel that Bybit is also uneasy. I am writing an article about Bybit’s security measures.
Virtual currency hacking incident
Incidents in which cryptocurrency exchanges are hacked are happening all over the world. A well-known hacking incident is that of a cryptocurrency exchange being hacked, but other than that, incidents of targeting personal wallets are also common. Phishing scams and malware are just that. The patterns in which cryptocurrency exchanges were targeted were as follows.
Mt.GOX
In 2014, about 850,000 BTC was leaked from Mt.GOX, the world’s largest cryptocurrency exchange at the time. It was criticized that assets were managed by a hot wallet and that this was exploited. Another problem was the lack of separate management of customer assets and company assets.
Coincheck
Coincheck, a cryptocurrency exchange, leaked all of NEM in 2018. This is also due to the same lax security as above, and assets are managed by hot wallets, which has been criticized considerably. The company has compensated the affected users.
Liquid
Liquid is a cryptocurrency exchange based in Singapore. This exchange had an incident in 2021 and was hacked into a hot wallet. BTC, ETH and even XRP have all been affected. After that, the company lost credibility and was acquired by FTX, a competitor.
Bybit Security
What kind of countermeasures does Bybit take while many exchanges around the world are being hacked?
Two-factor authentication
Many virtual currency exchanges also do it, but we have two-factor authentication. It is essential to protect your personal property. Two-factor authentication is also a very important setting for safely storing virtual currency at virtual currency exchanges.
cold wallet
A cold wallet is a wallet that is completely disconnected from the internet. Since virtual currency is stored completely offline, there is no risk of virtual currency theft due to unauthorized access. It’s the opposite of a hot wallet.
personal identification number
PIN is a security measure that is also introduced in other virtual currency exchanges. If you set your PIN with numbers and alphabets mixed with lowercase letters and uppercase letters, the security measures will be higher. In addition to login, Bybit can be set to require a password when trading cryptocurrencies.
multi-signature
We use multiple passwords to increase security. A technology that requires multiple passwords when logging in is called multisig. By using multi-signature, multiple people need to agree to send virtual currency.
SSL communication
SSL communication is an abbreviation for Secure Sockets Layer communication. It encrypts information on the Internet, and it is basically done on every website with the world standard security technology. A mechanism for encrypting exchanges (communications) between website visitors and websites.
Bybit measures and guarantees
Bybit takes the following security measures.
dual pricing
Bybit uses a dual pricing system to minimize deviations from fair prices and protect traders’ positions from forced liquidation due to market manipulation. The reason we do this is because the market price can deviate significantly from the spot price due to market manipulation. As a result, many people are forced to pay their debts.
fair trading environment
Fair prices on derivatives exchanges are set at prices that reflect real-time spot prices on other exchanges. This allows Bybit to create and provide a fair and fair trading environment to its users.
Withdrawal review
A common occurrence at virtual currency exchanges is incidents where funds are withdrawn by unknown users. Bybit only allows withdrawals at scheduled times every 8 hours. This is because withdrawal requests are reviewed manually. By doing this manually, we are taking measures to prevent withdrawals by anyone other than the user.
mutual insurance
Bybit has mutual insurance. This refers to the risk management of perpetual contracts in derivatives trading, and by using mutual insurance, losses in the event of severe price fluctuations are covered by compensation money. If you incur a loss from your position, you can receive compensation from this mutual insurance fund.
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