If you fall for a scam, in most cases your cryptocurrency coins will be gone as the scammers will immediately drain your wallet. However, staking coins can help protect your wallet as the funds are not immediately available. This post will cover how you can recovery your cosmos coins when you have locked them in staking.
How Cosmos Staking works
Cosmos Staking involves locking up your tokens to help secure the network and earn rewards. If your staked funds are compromised in a scam, there’s a chance of recovery thanks to this staking process. When funds are staked, they go through an unbonding period before they can be withdrawn. This means that even if a scammer gains access, they can’t move your assets immediately. This built-in delay provides an opportunity to recover those funds from the wallet.
Steps to recover funds
- Create a new wallet
To begin recovering your funds, create a new wallet with a new private key or mnemonic. Avoid using the compromised wallet for anything other than transferring funds to the new wallet. - Remove all liquid funds
While this may sound trivial, it is worth mentioning that scammers sometimes forget to check the first time. Especially if you have funds on multiple chains, it is worth checking them as this is the easiest way to recover your cryptocurrency. - Identify all pending (un-) staking positions
It is important that you are aware of all the funds you are staking and/or unstaking. Especially during unstaking it is mandatory to know exactly when they complete unstaking as that’s the window of opportunity. - Recover your staked assets
When the specified unstaking times are reached, timing is everything. You need to act quickly by submitting a transaction before the scammer does, which can be tricky without the proper tools. If you’re comfortable with programming, you could try writing your own script. However, remember that you only have one chance to get the money back. If it fails, the money is gone.
Alternatively, you can use a service like ours, Cosmoshield, which specialises in sending these recovery transactions quickly.
The Aftermath
After recovery, it’s crucial to keep your wallets secure. The team at Exodus, a cryptocurrency wallet app, has put together an excellent article covering all key aspects of asset protection. It offers detailed information on how to safeguard your funds effectively. You can find everything you need here: Exodus Security Guide.
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