Background Information: A survey conducted by Kraken exchange revealed that 48% of respondents consider themselves to be the greatest security risk to their cryptocurrency holdings, surpassing threats like theft or fraud. The core principle of cryptocurrency requires users to manage their own funds, thereby placing primary security responsibility on individuals.

Main Content: The survey also found that 31% of respondents support enhancing security protections through technological advancements such as biometrics, multi-factor authentication, and AI fraud detection. Kraken's Chief Security Officer Nick Percoco pointed out that lack of confidence in personal security limits the development of cryptocurrency; users must take on the responsibility of self-custody and cultivate strong security habits. Related startups have also attracted significant venture capital, with projects like World and Humanity Protocol securing funding in the biometrics field. Blockchain analytics firm Chainalysis acquired AI fraud detection company Alterya to prevent fiat currency fraud from entering the crypto space.

Potential Impact: Because Web3 security relies on personal responsibility, token holders need to take extreme measures to avoid losing access. Cryptocurrency scams continue to cause massive losses, with complaints related to online fraud in 2024 resulting in $9.30 billion in losses, with those aged 60 and above particularly affected. SoSoValue reminds users to strengthen security awareness to protect digital asset safety.

A new survey from the cryptocurrency exchange Kraken found that 48% of the 789 respondents feared themselves as their biggest security risk, above theft or fraud.Personal responsibility for security isn't a new concept, as the ethos of cryptocurrency requires users the user to solely manage their crypto funds. And while this ethos still sits at the core of digital assets, Kraken's study suggests that users may support bolstered guardrails to help individuals protect their funds.Kraken's survey found that 31% of respondents saw advancements in security, such as biometrics, multi-factor authentication, and AI-powered fraud detection, could help protect digital asset funds, according to a company release shared with The Block."A lack of confidence in personal security is capping crypto's growth," Kraken's Chief Security Officer Nick Percoco told The Block in an email. "To unlock its full potential, users must embrace the responsibility of self-custody and consistently invest in strong security habits — because in crypto, being your own bank means being your own first line of defense."Startups developing advanced crypto security protocols have indeed received an influx of venture funding. For biometrics alone, the Sam Altman-backed digital identity project World, which scans a person's iris to "prove their humanity," raised $135 million through a token sale in May. The web3 biometrics firm Humanity Protocol also netted a $30 million fundraise at a $1 billion valuation last year to build out palm-scanning infrastructure to verify a user's online identity.Additionally, the blockchain analysis firm Chainalysis acquired the AI-powered fraud detection firm Alterya for about $150 million in January to help note when individuals lost their fiat currency to fraud, and to prevent these funds from moving into crypto.As web3 security relies on personal responsibility, cryptocurrency holders will have to take extreme measures to avoid accidentally compromising their access to their crypto funds. For instance, a UK man had to scour a landfill for his mistakenly discarded hard drive containing 7,500 BTC (valued at $8.07 million as of writing), and had a 1 in 902 million chance of recovering it.Cryptocurrency scams still cost victims billions in lost funds, as a recent report from the Federal Bureau of Investigation's Internet Crime Complaint Center shows. In 2024, nearly 150,000 crypto-related internet fraud complaints resulted in $9.3 billion in total funds lost. People 60 and older alone lost $3 billion in crypto-related financial fraud — the group most likely to be affected by these scams, The Block previously reported.

Kraken Survey: 48% of Respondents Consider Themselves the Biggest Security Risk in Cryptocurrency