Cryptocurrencies and NFTs are both gained popularity over recent years. Although both are digital assets and use the same technology and programming language, the two are different asset classes.
So how do NFTs differ from traditional cryptocurrencies?
NFTs cannot be exchanged at equivalency, unlike with traditional crypto. Every NFT is uniquely digitally identifiable by its digital signature, which cannot be replicated, thus ensuring the token’s distinctiveness from others. This digital asset class’s non-fungibility makes it unique.
Also, this blockchain-based means of asserting ownership of a unique digital asset, such as art, video game items, memes and GIFs, music, sports highlights, trading cards and collectibles, domain names, virtual fashion, and other online pop culture items.
As NFTs are not strictly limited to art and visual mediums, more people are investing in the asset class. Accordingly, trading volume in NFTs reached nearly $11 billion in the third quarter of 2021.
Because of the significant amounts of financial assets invested in NFTs and cryptocurrencies alike, these digital assets have become a prime target for fraudulent individuals. Therefore, utilizing more robust cybersecurity measures is paramount when securing digital financial accounts and wallets that hold crypto or NFT assets.
The most common method of authentication in digital accounts is the entering of passwords. However, this conventional authentication method is proven to be highly insecure, prone to cyberattacks, and does not meet the security requirements mandated by most regulatory bodies.
Utilizing FIDO/FIDO2 authentication solutions can help secure digital financial accounts and assets. FIDO2 authentication protocol works via private/public key cryptography bound to the user’s device and biometrics. With this modern solution, an account user can access their digital wallet using their biometric (fingerprint or face scan).
Securing a digital wallet or any digital asset is imperative as there is currently no regulatory protection for users who lose their crypto assets due to fraudulent schemes. For more information on how to best protect NFTs, see this infographic by LoginID.
