Cybercrimes have doubled since the COVID-19 pandemic. According to the Global Financial Stability Report, one-fifth of security breaches in recent years affect financial institutions. Forex and other trading markets are among the highly affected industries. In this article, you’ll learn about the most common cybersecurity threats for forex traders and ways to protect your money online using VPS hosting.
What are the most common cybersecurity threats in forex trading?
Account hacking
With thousands of cyberattacks on people’s personal data happening daily, protecting your trading account is a must. Usually, scammers steal login credentials through:
- Taking advantage of weak passwords
- Lack of account authorization procedures
- Phishing attacks
- Malware that captures and steals private data
Man-in-the-middle (MitM) attacks
MitM attacks happen when an attacker intercepts communication between you and your broker or the financial markets. They might use impersonation techniques and create spoofed websites to get you to give out your login details.
Phishing
Phishing continues to be one of the most common cybercrime tactics. Attackers use emails, social media, and impersonation techniques to get you to click on their links or download malware. This way, they gain access to your device or your sensitive data, which they can use to steal your money or influence trading decisions.
Distributed Denial of Service attacks
In the case of a Distributed Denial of Service (DDoS) attack, attackers use botnets and other tools and tactics to overwhelm trading platforms or broker websites with traffic and requests. When the server is overloaded with requests, it can’t function properly. This can cause service disruptions and weaken the defense systems of the broker or trading platform.
Fraudulent brokers
As forex trading is becoming more and more popular, many scammers try to cash in on it. They create fake broker services to lure unsuspecting people. Once you create an account and deposit money on such a website, the scammers might disappear with the deposited money, manipulate trading platforms to show false profits, or prevent withdrawals.
How can a VPS help protect your trading activity?
A virtual private server (VPS) is a virtual environment with dedicated resources for you to store all your trading software, trading bots, news trackers, and other tools. Unlike storing your trading activity in a shared hosting environment, a VPS is private, and only you can access and manage it.
Here’s how a VPS can help protect your forex trading from cyberattacks:
Advanced security infrastructure
Depending on the VPS hosting provider, you can get enterprise-grade firewalls and intrusion detection systems. What’s more is that you can customize your firewalls, access rights, and other security settings to make sure your money and private information are safe.
Regular security updates
When you manage a VPS, you can perform regular security system updates and install new update patches.
Isolation
A VPS is private and only you and your authorized people can access your server. This means you are in control of who enters this environment.
Data encryption
VPS hosting service providers use advanced data encryption to protect your sensitive information. With a VPS, you can set up encrypted connections between yourself, the broker, and financial markets to give even more protection to your data.
Location advantage
Most VPS providers offer multiple server locations to choose from. The closer your server is to you or your broker, the fewer chances of interception there are.
What to consider before getting a VPS
Before you commit to one VPS hosting provider:
- Learn about their data privacy and protection policies.
- Make sure the server can be customized to meet your needs and adapt to your trading activity.
- Take into consideration the location of the servers the provider offers. It’s better to choose servers that are closer to you or your broker to ensure minimal latency.
- Look for providers offering high uptime (ideally 99.9% or higher).
- Keep in mind the extra costs you’ll have to pay for hosting each month.
In the end, hosting your trading software and other tools on a VPS can offer more protection for your trading activity.