Protecting digital assets in the financial sector has largely been an uphill task, characterized by the lack of one-size-fits-all solution or potentially effective fixes. The problem increases in complexity as new financial technologies are being unveiled and digital communications systems keep evolving. Bitcoin, a popular cryptocurrrency that evolved out of recent innovations in global payment systems, has been the new buzzword in the financial security domain requiring constant improvements. Securing personal accounts and wallets related to Bitcoin has generated intense interest among researchers and scientists world over who aim at developing hack-proof communication systems. A recent study made by a team of computer scientists at the University of Edinburgh could identify critical holes in Bitcoin payment systems which make these systems vulnerable to hacks and security theft. They further suggested ways to improve the underlying technology by proposing fixes.
Encryption System Could Prevent Hackers Siphoning off Funds from Bitcoin Wallet
The intensive security analysis done by the scientists found that users’ privacy in Bitcoin wallets and the overall communication system could easily be compromised with. They conducted tests by developing a malware, which could intercept messages sent between hardware wallets and the various devices that manage them, including computers. The funds in the Bitcoin wallet could easily be accessed by hackers who would siphon them off to their personal accounts. To prevent this, the researchers suggested that a robust system that could encrypt these messages. Furthermore, the encryption could be applied across different payment models using Bitcoin wallets.
User Privacy of Paramount Significance
According to the lead researcher, despite using advanced hardware, accessing users’ information was no big thing for hackers. Essentially, he believes that a digital wallet should not only protect the funds but also secure the users’ privacy. The findings in the new research could act a basis for developing digital system for securing Bitcoin wallets and communication systems using other popular cryptocurrencies.