Crypto users trust tech more than themselves, study shows

While security anxiety is limiting crypto adoption, nearly half of the respondents in a recent US survey showed that they fear making mistakes themselves rather than being targeted by criminals.

These were the findings of a survey of 789 respondents in the US by the Kraken crypto exchange.

Fifty percent of the survey participants agreed to some degree that concerns about crypto platform security have prevented them from investing more in crypto assets. Two-factor authentication is the most popular measure to secure assets stored on a crypto exchange, while "unique, strong" passwords and avoiding public WiFi come next. Meanwhile, things such as hardware wallets and multi-signature wallets, which are considered to be the best protection from online theft, are among the least popular measures.

In either case, almost a third of the respondents hope that advances in security technology, such as biometrics, multi-factor authentication, and AI-driven fraud detection, will help them better secure their assets. At the same time, education on how to stay safe is seen as less helpful.

"In other words, many holders may be placing their hope in external solutions (like advances in security technology or government oversight) to keep their crypto safe for them, rather than taking on the burden of staying one step ahead of the next potential threat themselves," the authors of the survey said.

Meanwhile, 48% of the respondents said they’re more concerned about losing their funds due to their own mistakes rather than fraud or theft. It seems this fear is grounded in reality, as almost a quarter of the survey participants admitted that they've lost private keys that give access to their crypto assets. Meanwhile, more than a fifth have sent their digital coins to the wrong address, while almost a third are reusing passwords across multiple accounts.

"In traditional finance, you might call your bank to reverse a transaction or reset a password. However, when it comes to staying safe in [decentralized finance], self-custody means self-responsibility. There are not the same sorts of safety nets ready to help if you have an issue with your crypto," Kraken said, reminding users of the importance of using hardware wallets, backing up recovery phrases, double-checking transaction addresses, and staying alert to phishing attempts.