No matter how secure your bitcoin or cryptocurrencies are, even if you own a reputable hardware wallet and have your recovery seed stored safely in a locked safe, these safety precautions can be rendered useless by the $5 wrench attack. But, what is it and how do I protect myself from it?
What is the $5 Wrench Attack?
Basically, if someone finds out that you own a significant amount of coins, they can straight-off physically attack you, or threaten you to hand over your wallet’s private key or threaten you to send over the funds to them by using a deadly weapon or a basic tool that can be used for harm, like a kitchen knife, a hammer, a screw driver, or a cheap and rusty $5 wrench.
No matter how secure your funds are in your hardware wallet or on your computer, no computer security can save you from this type of attack.
So, how do you protect yourself from it?
1. Keep it private
The same reason why it would be a very bad idea to tell everyone that you won the lottery.
You can probably talk about bitcoin with friends occasionally, but prevent telling people about you “stacking sats”, you “hodling” xxxx number of bitcoins, you earning big bucks on your recent successful trade, or something along those lines. If such sensitive information about you reaches the wrong people, you might be in trouble. Boasting about your cryptocurrency holdings is just adding unnecessary risk to yourself, or worse, possibly even to your family and friends.
If someone you don’t know or don’t know well asks you about bitcoin or cryptocurrencies, the best answer would probably be: “What’s bitcoin? Never heard of it“. Or something along those lines.
2. Prevent getting unwanted attention
Bitcoin or cryptocurrency stickers in your car, on your laptop, having bitcoin and cryptocurrency related license plates, those things.
As bitcoin and cryptocurrency enthusiasts and investors, Bitcoin and crypto stickers and license plates are cool and all that, but unless you work in the cryptocurrency industry and is quite well-known anyway, It’d be best to prevent flaunting your affiliation with cryptocurrencies especially in public.
Having these public gimmicks is one of the best ways to attract attention if you want to be followed by criminals on your way home.
3. Have better home security
Regardless if you own bitcoin and cryptocurrencies or not, this should be a priority in the first place. Improve your home security by adding locks to your doors and simply locking them always, getting a firearm(if legal in your jurisdiction), adopt a loyal and trusty canine, setting up security cameras and motion sensors, those stuff.
We won’t be going in-depth on this point simply because there’s so much good content and articles on the web already.
4. Set up a dummy wallet
If for instance you own $100,000 worth of cryptocurrencies, it wouldn’t hurt to create a separate wallet using a separate set of private keys and store a few thousand dollars in it. That way, if you were ever a victim of the $5 wrench attack, you could potentially get away with it by making a well-fabricated alibi like how you gambled your coins away and now you’re only left with a few thousand dollars worth of coins; something like that. If you’ve ended up successfully convinced the thief, then it should be a win for you.
While you still end up losing some coins, losing only a small percentage of your total holdings is still better than losing everything.
If you own a reputable hardware wallet like the Trezor or the Ledger, which you should if you want to take your security seriously, you can follow the steps on how to create secure passphrases on their respective articles:
While some people are taking their cryptocurrency security or online security in general very seriously(which is a great idea), people might be forgetting the most vulnerable part: you as a person. Regardless how secure your funds are, you’re still the weakest link. Following the steps above should be enough to protect you from this attack.
NOTE: The $5 wrench attack doesn’t only work with cryptocurrencies. It can work with your online bank account as well.