Is Crypto.com Safe? Learn about its Security Measures

When considering trading cryptocurrency, many people are looking for reliable platforms. Crypto.com is one of the safest crypto exchanges. But, is Crypto.com safe to use? This guide explores the security measures, the risks involved, and what users can do to protect their investments at Crypto.com.

Key Takeaways:

• The Crypto.com exchange is highly secure with safety measures such as 2FA, cold storage, anti-phishing code, withdrawal address whitelisting, and transparent PoR data.
• Crypto.com provides FDIC insurance for U.S. users’ fiat balances, up to $250,000.
• They offer a HackerOne Bug Bounty program to continuously strengthen their system by encouraging responsible vulnerability reporting.

Crypto.com Exchange Overview

Crypto.com, founded in 2016, has rapidly grown into one of the largest crypto exchange platforms globally, with over 100 million users. The company has positioned itself as a leader in regulatory compliance, holding licenses across multiple jurisdictions, including the UK, Singapore, and France. This broad regulatory footprint is key to its commitment to user safety and trust. 

Crypto.com’s platform supports a wide range of services, including cryptocurrency trading, staking, and payments, and has expanded into sectors such as NFTs and decentralized finance (DeFi). Its daily trading volume often exceeds billions, with the platform processing significant spot and derivatives trades. It also offers margin trading with up to 5x leverage.

Crypto.com leads in decentralized finance (DeFi) by offering you access to services like yield farming, staking, and liquidity pools. Its native token, Cronos (CRO), plays a key role in these activities. When you hold CRO, you get benefits such as earning rewards and lower trading fees. Read our full Crypto.com review for more information.

Is Crypto.com Safe: 10 Security Measures

Yes, Crypto.com is one of the best crypto exchanges that employs a wide range of security measures to safeguard your funds and personal data. Thanks to a layered approach that includes everything from offline cold storage to advanced encryption protocols. 

Here’s a detailed look at the top 10 security measures that Crypto.com uses to ensure your peace of mind:

Cold Wallet Storage

One of the most crucial aspects of Crypto.com’s security strategy is its use of cold wallet storage for the majority of user funds. Keeping cold wallets offline and disconnected from the internet makes them much less susceptible to hacking attacks. In fact, over 90% of all user funds are stored in cold wallets, a standard practice among major cryptocurrency exchanges.

Hot wallets, which are used for day-to-day crypto transactions, only hold a minimal amount of assets necessary to maintain liquidity. This division between cold and hot wallets ensures that even if the hot wallet is compromised, the impact on user assets is minimal. 

The cold wallet strategy is reinforced by multi-signature wallet protocols, which require multiple approvals from different parties before any transaction can be made from these wallets. This minimizes the risk of internal fraud or unauthorized access.

Additionally, Crypto.com’s cold wallet storage is secured in institutional-grade vaults. These vaults are located in geographically dispersed locations to reduce the risk of a single point of failure. Even in a physical attack or a natural disaster, the distributed nature of these vaults ensures your funds remain secure.

Anti-Phishing Code Set Up

Phishing attacks are a major threat in crypto, where attackers often try to impersonate official platforms to steal user credentials. To counter this, Crypto.com offers the option to set up an anti-phishing code. This is a personalized code that appears in all legitimate emails from Crypto.com, allowing you to quickly identify whether an email is from the official platform or a phishing attempt.

In addition to the anti-phishing code, the platform’s email and communication protocols are secured using the latest Transport Layer Security (TLS) encryption standards. This ensures that all communications between the platform and your email are encrypted, reducing the risk of interception.

Multi-Factor Authentication (2FA)

Multi-factor authentication (MFA) is another critical layer in Crypto.com’s security framework. By requiring at least two methods of verification – such as a password and a one-time code from an authentication app – MFA significantly reduces the chances of unauthorized access to your account.

Crypto.com goes beyond the standard MFA. It supports multiple forms of verification, including SMS-based codes, app-based authenticators like Google Authenticator, and even biometric verification through fingerprints or facial recognition. This guarantees that, even if your password is breached, an intruder cannot enter your account without the additional authentication method.

It’s also important to note that MFA is required for all sensitive actions on the platform, not just login attempts. This includes withdrawals, password changes, and the modification of key account settings. For additional protection, Crypto.com mandates MFA for the activation of API keys, which are used by more advanced users to automate trading or access their accounts programmatically.

Secure Software Development Life Cycle

Crypto.com integrates security from the very beginning of its software development process through a Secure Software Development Life Cycle (SDLC). This approach involves security audits and testing at every stage of development. 

Each new feature or update is peer-reviewed, and both static and dynamic source code analysis tools are used to catch potential vulnerabilities before they can be exploited.

The SDLC process is not limited to internal teams; external security firms are also involved in auditing Crypto.com’s codebase. For example, Kudelski Security, a globally recognized firm, regularly performs third-party security assessments. This ensures that Crypto.com’s security practices are up to date with the latest industry standards.

Moreover, the platform employs real-time monitoring tools that track network traffic and application behavior for any signs of anomalous activity. Any detected anomalies are flagged and addressed immediately, further reducing the risk of zero-day exploits or emerging threats.

Withdrawal Address Whitelisting

Crypto.com has strengthened its withdrawal security by introducing address whitelisting. This feature allows users to restrict withdrawals to specific, pre-approved wallet addresses. Here’s how it works:

• You can pre-approve specific crypto withdrawal addresses like USDT (BEP20) address or Bitcoin (BTC network) in your account settings.
• Funds can only be withdrawn to these whitelisted addresses.
• Adding a new withdrawal address requires email verification and has a 24-hour waiting period.

This 24-hour cooling-off period provides extra security, ensuring that even if an attacker gains access to your account, they cannot instantly withdraw funds to their own wallet.

To further secure your assets, the platform also requires email verification for every withdrawal request. This means that you must confirm all transactions via email before transferring funds, adding one more safeguard to the process.

Proof of Reserves (PoR)

Crypto.com uses a Proof of Reserves (PoR) system to ensure transparency regarding the platform’s financial stability. This system lets you confirm that your assets are fully backed by the platform’s reserves, addressing any concerns about the possibility of insolvency (similar to FTX).

The Proof of Reserves process is conducted by independent auditors from the Mazars Group, who regularly check and verify Crypto.com’s assets. They publish reports to confirm that the platform holds enough assets to match all customer balances. This guarantees that your funds are backed 1:1, and you can withdraw them at any time. 

To ensure all reserves are properly accounted for, cryptographic methods are used during the auditing process, which further increases transparency. A key part of this system is the use of Merkle Trees. A Merkle Tree is a structure that organizes large amounts of data, making it easier to verify and audit. In this case, it allows you to confirm that your individual assets are included in the total reserves without revealing any sensitive account information.

Here is the current fund reserve ratio by Crypto.com:

(Source: Mazars Group Audit)

User Funds Stored in Custodian Bank Accounts

When you hold fiat currencies on Crypto.com, your funds are kept in regulated custodian bank accounts, adding an extra layer of protection for your non-crypto assets. If you’re a U.S. resident, your money is placed with Community Federal Savings Bank or other FDIC-insured banks. 

This gives you coverage of up to $250,000 per depositor in case the bank fails. However, it’s important to understand that FDIC insurance only applies to your fiat balances. It doesn’t cover losses if Crypto.com itself fails or in cases of fraud or theft.

This setup ensures that, even if Crypto.com faces financial troubles, you have fiat currency security in place. For those outside the U.S., Crypto.com works with regulated institutions in different regions to comply with local financial rules.

24/7 Customer Support

If you have any security concerns, Crypto.com offers customer support 24/7 to help you right away. Whether you’re having trouble accessing your account, notice suspicious activity, or need help setting up extra security like MFA, the support team is always there to assist.

Crypto.com’s team is trained to handle security issues quickly, making sure any threats to your account are dealt with fast. This quick support is especially helpful during stressful times, like a market crash or account lockout, when fast help can really make a difference.

Certifications and Assessments

Crypto.com is among the most certified platforms in the cryptocurrency industry. It holds certifications for ISO/IEC 27001:2022, ISO/IEC 27701:2019, and PCI DSS v4.0 Level 1, which are internationally recognized standards for information security and data privacy management.

Furthermore, Crypto.com has achieved SOC 2 Type II compliance, demonstrating that it has controls in place to protect user data and ensure privacy.

Hacker One Bug Bounty

Crypto.com runs a HackerOne Bug Bounty Program, inviting ethical hackers from all over the world to find and report any weaknesses in the platform. By offering rewards for responsible reporting, Crypto.com makes sure even small security problems are fixed quickly before they can be taken advantage of by bad actors.

Here is a table showing the rewards offered in the program:

How to Stay Safe While Using Crypto.com?

Although Crypto.com provides numerous security measures, here are some additional tips to avoid crypto scams and further protect your account:

• Enable Multi-Factor Authentication (MFA): Always enable Multi-Factor Authentication (MFA) on your account. You can use an authenticator app or SMS verification to receive a one-time code whenever you log in or perform sensitive actions.
• Use Strong, Unique Passwords: Use a strong, unique password that combines letters, numbers, and symbols. Avoid common words or easily guessable information, such as your birthdate or name. 
• Regularly Monitor Your Account Activity: Keep an eye on your account activity by checking your transaction history regularly. If you notice anything unusual, report it to Crypto.com’s customer support immediately. 
• Beware of Phishing Attempts: Be vigilant about phishing attempts, as scammers often try to impersonate Crypto.com through fake emails or websites. Always double-check the URL before entering your credentials, and ensure that the site is secure (look for “https://” in the address). Crypto.com will never ask you for your password via email, so be cautious of any communication that requests sensitive information.
• Keep Your Devices Secure: Keep your operating systems, antivirus software, and applications updated to protect against malware and other vulnerabilities. Avoid using public Wi-Fi networks to access your account. If you must use a public network, consider using a Virtual Private Network (VPN) to encrypt your internet connection and protect your data.
• Consider Hardware Wallets for Long-Term Storage: If you plan to hold large amounts of cryptocurrency for an extended period, consider using a hardware wallet for storage. Hardware wallets store your private keys offline. 
• Use the App’s Security Features: Features like address whitelisting for withdrawals add an extra layer of security, ensuring that only approved addresses can receive your funds. You can also set withdrawal limits to reduce the risk of losing large amounts in case of unauthorized access.

Final Thought: Is Crypto.com Safe in 2024?

In a nutshell, Crypto.com has invested heavily in security, offering a range of protective measures for its users. From cold wallet storage and multi-factor authentication to high-level certifications and external audits, the platform is committed to safeguarding your funds. Additionally, with their Account Protection Program (APP), eligible users have up to $250,000 in coverage for unauthorized transactions.

The platform also engages top-tier security auditors and partners with ethical hackers to continually assess its security posture. For 2024, Crypto.com appears to be one of the more secure and transparent cryptocurrency platforms, making it a good choice for anyone looking to buy, sell, or hold digital assets.

FAQs

Is Crypto.com App Safe?

Yes, the Crypto.com app uses best-in-class security features like MFA, biometric authentication, and HSM (Hardware Security Module) for key management. Additionally, the app is regularly updated with security patches and improvements to address any vulnerabilities.

Is Crypto.com regulated and licensed?

Crypto.com is a well-regulated crypto trading platform across several jurisdictions. It holds an Electronic Money Institution (EMI) license from the UK’s Financial Conduct Authority (FCA), which allows it to offer e-money services in compliance with local regulations. 

In Singapore, it has a Major Payment Institution (MPI) license from the MAS. The platform is also registered as a Digital Asset Service Provider (DASP) in France under the Autorité des marchés financiers (AMF). 

Additionally, Crypto.com has received regulatory approvals in countries like Australia, South Korea, and Italy, ensuring compliance with their financial and anti-money laundering (AML) standards.

Has crypto.com ever been hacked?

Crypto.com has faced security challenges, with the most notable incident occurring in January 2022. During this breach, unauthorized withdrawals affected 483 Crypto.com users, totaling 4,836.26 ETH, 443.93 BTC, and approximately US$66,200 in other cryptocurrencies. In response, Crypto.com took immediate action to enhance its security measures and protect user funds. In response, the APP restores funds up to USD$250,000 for qualified users.

Which is better, Crypto.com or Coinbase for user safety?

When comparing Crypto.com and Coinbase in terms of user safety, both platforms take strong measures to protect users. Coinbase is highly regarded for its robust security protocols, including cold storage of 98% of assets, insurance against theft, and strong two-factor authentication (2FA). It is also one of the few exchanges publicly, providing greater transparency. 

Crypto.com, on the other hand, emphasizes security through features like hardware security modules (HSMs) and has obtained ISO/IEC 27701:2019 certification for privacy and security management. Both exchanges also offer insurance coverage.

Is crypto.com safe for beginners?

Crypto.com is considered a legitimate crypto app for beginners. It provides a user-friendly interface with a range of educational resources that can help newcomers navigate the crypto space.

With regulatory licenses in key jurisdictions and an easy-to-use mobile app, it supports users from basic crypto purchases to more advanced financial tools like staking and crypto debit cards. Additionally, its compliance with international security standards provides reassurance to new users about the safety of their funds.

Can I safely withdraw money from Crypto.com to a bank account?

Yes, you can safely withdraw money from Crypto.com to your bank account. The crypto exchange allows users to transfer funds by linking a bank account and initiating a withdrawal through the mobile app or web platform. The process is straightforward. The transfer time can vary depending on bank and location, usually a few hours to a couple of business days. You can also link your credit or debit card.