Minimize Your Risk Exposure with 1 Crypto Wallet Health Habit
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| By Beth Canova |
Happy Spring!
With the new season comes everyone’s favorite springtime activity — spring cleaning.
But I’m not talking about airing out your house after a long winter. No, the kind of cleaning you should be doing is in your crypto wallet.
Maintaining good wallet health is a simple but effective way to reduce your risk exposure while navigating the crypto market.
Remember that hack I told you about back in December that redirected transactions to a third-party wallet?
It specifically targeted the connection between wallets and decentralized applications, or dApps — platforms and interfaces built on blockchains that allow you to swap, borrow, loan and stake on DeFi.
And there is one simple step you can add to your wallet cleaning routine to notably reduce your exposure to risk: Disconnecting your wallet from unused dApps.
While connected to your wallet, a dApp may be able to view your public address, wallet contents and transaction history. It may even have the ability to initiate transactions.
Naturally, if you’re connected to several dApps that you currently aren’t using, giving them this much access could expose you to hacks similar to what we saw in December.
As such, it’s good practice to routinely disconnect from unused apps as part of your wallet health maintenance.
Each wallet will have slightly different steps to accomplishing this. So, for today, I’ll use MetaMask as an example.
MetaMask is built on the Ethereum network, so it can access the largest number of dApps since Ethereum is the first and largest smart-contract blockchain.
Disconnect MetaMask from dApps
- Click on your MetaMask browser extension — marked by the orange fox icon — and log in to your wallet.
- On the home page, click on the three dots button in the top-right corner.
- In the expanded menu, click on Connected sites.
- A pop-up will appear showing all the dApps you’re connected to. Click Disconnect next to any sites you wish to disconnect from. That should be any you are not actively using.
If you have multiple accounts connected to the same site, you will see the option to remove connections from all your accounts when you click Disconnect.
And that’s it! Just four easy steps can help keep you insulated from bad actors and bugs on DeFi.
I should note, however, that while disconnecting from dApps does limit that dApp’s access to your wallet, it does not remove token approvals.
Token approvals enable dApps to access and move your tokens on your behalf.
Think about when you use a decentralized exchange, like Uniswap (UNI, “B+”) to swap one crypto for another. After you confirm a transaction on Uniswap, your MetaMask wallet will pop up and ask you to approve the transaction.
By clicking Approve in your wallet, you’ve officially given Uniswap permission to access your wallet for that transaction.
For convenience, that approval remains in place until you remove it. (To learn more about how token approvals work and how you can customize them in your MetaMask wallet, click here.)
While you don’t need to remove token approvals each time you trade, it should be another step in your overall wallet health routine for further risk prevention.
To remove token approvals, you can use websites such as Revoke or Unrekt. Both sites scan several networks, which is useful if you’ve been bouncing around from Ethereum to Solana (SOL, “B+”) and so on.
Just connect your wallet to see which dApps have token approvals for your wallet address and remove the ones you are not currently using.
Have fun with your crypto spring-cleaning and get ready to tackle the rest of this bull market.
Best,
Beth Canova
