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Digital platforms are transforming investors into new classes in markets. In fact, anyone can trade online by directly buying and selling securities from the devices. The process of opening a trading account has also gone easier, for pretty much all steps are taken online. However, as online trading is increasing, so does the urgency for stronger protection against it. It's commonly understood that two-factor authentication, or 2FA, must not be solely relied upon.

The Basics of Security on Online Trading

When a person opens an online trading account, he/she shares his/her identity proof, bank records, and login credentials. These pieces of information need protection as unauthorized trading may occur upon breach. Several features protect a user, such as encryption, firewalls, and multi-step authentication. Apart from two-factor authentication, the user must also prove that he/she is authorized by an additional check, which requires a code to be SMS- or email-based or created by an app installed on the device.

But 2FA is helpful when cyber criminals continue to find their way around it. Many of such cases demonstrate online trading is in dire need of enhanced protections.

Limitations of Two-Factor Authentication

Two-Factor Authentication is a Something the user knows-the password combined with something he/she has-a code belonging in device or Symbiote with the clear weaknesses:

SIM-Swapping- Attackers hijack mobile numbers to intercept one-time passwords.

Phishing Attacks - Users are deceived into producing both passwords and 2FA codes through trick websites or emails.

Malware Threats - Login credentials and codes are stolen by keyloggers or malicious apps.

User Errors - Investors may mistakenly approve fraudulent login attempts.

Gaps are observed, these further show that 2FA cannot secure online trading accounts completely.

Why Extra Protection Is Required

It involves money and securities, and thus, online trading is an evident target of fraud. Most online traders believe that by having completed the 2FA conditions, their accounting is entirely safe and secure. Unfortunately, markets run nearly in real-time, and breeches can initiate instant damage to funds. Unlike any function where stealing access only exposes the data to an attacker, trading accounts directly affect funds invested.

This risk makes it necessary to have multiple protection layers that complement one another-an approach commonly referred to as defense in depth.

Augmenting Security Beyond 2FA

Even with two-factor authentication for online trading, several things can be implemented:

Biometrics- Fingerprint or facial recognition introduces an even stricter identity check requirement.

Device Binding- Access will be prevented using devices not pre-registered to sign into a trading account.

Transaction Alerts- Such notifications are sent instantaneously to alert any suspicious activity to the investor once it occurs.

Behavioural Monitoring- Such platforms can view activity regarding time of login and devices used by the investor for such and then monitor it against overall trading activity so flagging irregularities.

Regular Password Changes- Updating them would reduce exposure to stolen credentials.

All these combined would prove to develop layered barriers making it tougher for an unauthorized entry.

Role of an Investor in Security

Security is solely the responsibility of the platforms; investors are not allowed to sleep over their vigilance. The trading accounts opened would give rise to transactions, but people would forget safety practices. Strong passwords, avoiding public Wi-Fi for logins, and including antivirus tools are small steps that would help in reducing risk. Staying alert to phishing messages or fake links prevents breaches, too.

Investor education is important because even the best systems fail if users unknowingly share their details.

The Role of Platforms Plus Regulation

Regulators in India focus on the welfare of investors through consumer and investor protection policies, which would benefit spanning security frameworks. Risk monitoring would happen more effectively through tools, regular audits, and updates to upgrade such platforms. The steps reduce breaches but increase confidence in online trading systems.

AI-powered fraud detection, alongside multi-layered authentication, is being adopted to complement 2FA in many other platforms. These will provide for safer participation as volumes continue to grow.

Conclusion