What is a cryptocurrency and how does it work?

Cryptocurrencies are digital assets that rely on an encrypted network to execute, verify, and record transactions, independent of a centralized authority such as a government or bank. Cryptocurrency was developed as an alternative to the dollar, and its functions can make it an attractive investment.

How do criminals get cryptocurrency?

There are two main ways criminals obtain cryptocurrency: stealing it directly, or using a scheme to trick people into handing it over. In 2021, crypto criminals directly stole a record US$3.2 billion (A$4.48 billion) worth of cryptocurrency, according to Chainalysis. That’s a fivefold increase from 2020.

Should you invest in crypto?

As such, I feel compelled to invest a small portion of my assets into crypto. I also acknowledge that it's a viable way to branch out within my portfolio. And diversifying is something every investor should do.

How do I protect myself from cryptocurrency exchange theft?

One way consumers can protect themselves from exchange theft, or insolvency, is to transfer their cryptocurrency from the exchange to a software wallet (a secure application installed on a computer or smartphone) or a hardware wallet (a hardware device that can be disconnected from the computer and internet).