How Improper Use of WalletConnect on Web3 Wallets May Pose a Security Risk of Being Phished

04/17/2023 11:49 • AI Insights • 91 views

According to reports, the Slow Fog security team has discovered that improper use of WalletConnect on Web3 wallets may pose a security risk of being phished. This issue exists in scenarios where the DApp Browser+WalletConnect built-in to the mobile wallet app is used.

Slow Fog: Alert to the Risks of WalletConnect Phishing in Web3 Wallets

As the world of cryptocurrency gains more attention, it’s crucial to ensure that the security of user funds is maintained. Unfortunately, the Slow Fog security team has discovered a potential security risk when using WalletConnect on Web3 wallets.

What is WalletConnect and How Does it Work?

WalletConnect is an open-source protocol that enables decentralized applications (DApps) to access a user’s wallet. It allows the user to connect their wallet to the DApp by scanning a QR code, which generates a temporary encrypted channel for communication.
Web3 wallets are wallets that support Web3 protocols, such as Metamask or Coinbase Wallet. They offer enhanced security features, such as private key encryption, and are accessible through a web browser.

How WalletConnect May Pose a Security Risk

The Slow Fog security team has discovered that the improper use of WalletConnect on Web3 wallets may pose a security risk of being phished. This risk is prevalent when the DApp Browser+WalletConnect is built-in to the mobile wallet app.
Phishing attacks typically occur when an attacker creates a fake website or application that mimics a legitimate site or app to steal login credentials or sensitive information. In the cryptocurrency world, hackers may use phishing attacks to gain access to a user’s private keys or seed phrases, allowing them to steal funds.
The issue occurs when the user scans a QR code to connect their wallet to a DApp. If the mobile wallet app has the DApp Browser+WalletConnect built-in, the QR code may direct the user to a phishing website or DApp, rather than the intended destination.

How to Protect Your Funds

To protect your funds, it’s crucial to ensure that you are using a reputable Web3 wallet and DApp. When connecting your wallet to a DApp using WalletConnect, always verify the URL of the DApp before proceeding.
Additionally, only use WalletConnect with trusted DApps and never input your private key or seed phrase into a DApp or website.
Finally, be cautious when using mobile wallet apps that have the DApp Browser+WalletConnect built-in. Ensure that the app is up-to-date and that you have enabled all available security features.

Conclusion

The discovery of the security risk posed by improper use of WalletConnect on Web3 wallets is a significant concern for the cryptocurrency community. While the risk can be mitigated by taking appropriate security measures, it’s essential to remain vigilant at all times.

FAQs

**Q: What is Web3?**
A: Web3 is a term used to describe the next generation of the internet, which is decentralized and built on blockchain technology.
**Q: What is a phising attack?**
A: A phishing attack is a type of social engineering attack where an attacker attempts to trick a user into revealing sensitive information through a fake website or application.
**Q: Can I use WalletConnect on all Web3 wallets?**
A: No, not all Web3 wallets support WalletConnect. Check with your wallet provider to see if they support the protocol.

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