NFT marketplace OpenSea has been given some flack by the crypto community after it froze 16 NFTs comprising of Bored Apes, Mutant Apes, and a Clonex after they were reported as stolen.
This freezing of NFT sales has prompted many to have their say about OpenSea’s intervention and the impact and precedent it sets within the crypto space. Cryptocurrency is supposed to be a decentralised system, meaning that there is no intervention from a third-party authority, and that your own assets are solely under your control, and you are solely responsible for them.
So firstly, how were the NFTs ‘stolen’? Well… They were, and they weren’t… Todd Kramer, the victim of this grand larceny, held his NFTs in a Hot Wallet. Those who know what a hot wallet is, skip to the next paragraph. A Hot Wallet is a type of crypto wallet that is always connected to the internet whenever its host device is connected. Metamask is the most common wallet, which is simply an extension-based wallet in your browser. It’s secure, but it’s only as secure as the host system itself.
Kramer clicked a malicious phishing link which allowed access to his hot wallet, giving the hackers the opportunity to transfer his precious monkeys to another zoo. He then tweeted that the apes were stolen and pleaded with OpenSea to help, and they obliged. The value of the NFTs in question at the time of the theft is estimated around $2.28 million.
OpenSea’s intervention caused outrage amongst members of the crypto-community. A lot of criticism stating that the freezing of those assets demonstrated a centralised power amongst a decentralised industry, others stating that Kramer didn’t invoke proper security measures to safeguard his assets and felt the repercussions of that unpreparedness.
So, what could Kramer have done to protect his monkeys and keep them safe from poachers?
It’s simple. Something that has been around from the start. A Cold Wallet.
A Cold Wallet is a storage solution much like a Flash Drive, it is inactive unless plugged into a device. Your NFTs and cryptocurrencies are safely stored away in your safe, or drawer, or wherever you choose, and when you’re ready to use them or transfer them, simply plug it in, and authorise any transaction using a physical confirmation such as button presses, or something similar.
Until hackers are able to reach through your screen and physically press a button to approve a transaction, Cold Wallets will be the greatest line of defence between the Wild Web, and your cryptoassets.
Invest a little, save a lot.
Get a Cold Wallet.
I’m sure Kramer’s is already in the mail.
