Oct 30, 2024
KPX Blog
Blockchain
Cryptocurrency
SIM Swap Attack: What It Is and How to Prevent It
As smartphones are increasingly used to manage our digital assets, they have become prime targets for cybercrimes. One of the most significant threats, especially for cryptocurrency users, is the SIM swap attack, which can lead to dear financial losses by bypassing even robust security systems.
What Is a SIM Swap Attack?
A SIM swap attack, also known as SIM hijacking or SIM swap fraud, involves a hacker pretending to be the victim to gain control of their phone number. This access allows them to gain access into the victim's financial and social media accounts. The attack can occur in two primary ways:
Through physical theft of the victim's phone
By deceiving the mobile carrier into activating a new SIM card
Understanding SIM Cards
A SIM (Subscriber Identity Module) card is a small, removable device embedded with a chip that provides essential mobile services like calling, texting, and data. It holds identifying information and operational data, which can be transferred to another device if the SIM card is exchanged.
How Does a SIM Swap Crypto Attack Work?
In a SIM swap attack, the unique data from a victim's SIM card is illicitly transferred to another SIM card, rendering the original card inactive. Scammers gather personal information means such as malware, phishing, social media, among others. They then use social engineering to manipulate the victim's mobile carrier to port the phone number to their own SIM card.
Once successfully cloned, the new SIM card functions like the original, enabling scammers to bypass security measures such as two-factor authentication (2FA). They can use the victim's phone number to receive OTPs, log into accounts, access crypto wallets, and more, leading to the theft of digital assets.
Although SIM swap attacks have traditionally affected financial institutions, they are increasingly targeted at the cryptocurrency sector, showing the need for enhanced security measures against such tactics.
To mitigate these risks, users are encouraged to implement additional security precautions, such as using hardware wallets and stronger forms of account authentication, beyond just relying on two-factor authentication linked to phone numbers.