What is SMS Authentication and Is It Secure?

SMS authentication is a security method that sends a code to your phone when you try to log into an account. You enter that code to prove it’s really you. It’s a simple way to add an extra layer of protection beyond just a password.

While it’s easy to use and better than having no protection at all, it’s not the most secure option out there. Hackers have found ways around it through methods like SIM swapping and phishing attacks.

In this article, we will learn how SMS authentication works, why it is so popular, and where it falls short. You’ll also learn how to stay safer online, and whether it’s time to upgrade to more secure alternatives.

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How Does SMS Authentication Work?

SMS authentication is a type of Two-Factor Authentication (2FA) or Multi-Factor Authentication (MFA). It works by sending a one-time code to your phone when you try to log into an account. After you enter your username and password, the website sends a short code via text message or email.

You type in that code to prove it’s really you. The code usually works for only a few minutes and can be used just once. This extra step makes it harder for someone else to get into your account, even if they know your password. It’s quick, easy, and doesn’t require installing anything.

Enabling 2FA is one of the most effective ways to prevent account takeovers and reduce the risk of hacking.

Is SMS Authentication Actually Secure?

SMS authentication is a common form of Two-Factor Authentication (2FA) and Multi-Factor Authentication (MFA), offering better protection than passwords alone. However, hackers have found ways to exploit it. One common method that they use is SIM swapping, where they trick your phone provider into giving them control of your phone number. Once they have your number, they can get your authentication codes and access your accounts.

On top of that, text messages aren’t always encrypted, which means they can be intercepted while they’re on their way. This makes it easier for attackers to steal your code before it reaches your phone. Here is the percentage of account takeovers associated with the noted authentication mechanism as of November 2022.

• SMS / Text-Based Codes: 95.65% of account takeovers
• Time-Based One-Time Passwords (TOTP): 4.13% of account takeovers
• Coinbase App Push Authentication: 0.18% of account takeovers
• Physical Security Key: 0.04% of account takeovers

So, while SMS authentication adds some security, it is not the most reliable. If you want better protection, you need to set up options like authentication apps or biometric checks (fingerprints or face scans) that are much harder for hackers to bypass.

Guardio helps you spot these weak points. It shows you which of your accounts are still active without any two-factor authentication and might be putting you at risk.

Types of SMS Authentication

SMS authentication comes in different types, and each of them offers a unique way of protecting your accounts. Let's take a look at some of the most common ones:

One-Time Passwords (OTPs)

One-Time Passwords, or OTPs, are 4 or 6-digit short codes sent to your phone that you use to log in. The code expires after a short time and can’t be used again once it’s used. OTPs are simple, fast, and widely used. There are also two common ways these codes are generated:

• Time-Based One-Time Password (TOTP): These codes are generated using a special algorithm and are based on the current time. Each code only lasts for about 30 seconds, so even if someone tries to steal it, they have a very limited window to exploit it. Apps like Google Authenticator or Authy are examples of tools that use TOTP to generate these time-sensitive codes.
  
  
• HMAC-Based One-Time Password (HOTP): These codes use a counter. Every time you ask for a new code, the counter goes up. The system creates a new code based on that number. This means you don’t need to worry about the code expiring quickly like with TOTPs, but if someone figures out the counter, they could guess the next code.

Two-Step Verification (2SV) & Multi-Factor Authentication (MFA)

Two-Step Verification (2SV) is one of the most common ways people add an extra layer of security to their accounts. It usually involves entering your password first, followed by a one-time code sent to your phone or email. While it's better than relying on a password alone, it's still not the most secure option available, especially if that second step is a simple text message or SMS Auth, which can be intercepted.

Multi-Factor Authentication (MFA) takes the idea further by combining two or more different categories of verification, such as a password, a phone or a security key, and even a biometric factor like a fingerprint or facial recognition. It includes something you know, like a password, and something you have, like a physical device or a fingerprint or a face scan.

These are much harder to fake or steal. MFA lowers your risk because even if someone gets your password, they still need something else, and that second factor should be a lot harder to crack than a text message.

Pros and Cons of SMS Authentication

Everything in security has both upsides and downsides. Let’s take a closer look at the pros and cons of SMS authentication:

Pros

• Stronger Security Measures: SMS authentication adds a second step to your login process. Even if someone steals your password, they still need the code sent to your phone to get in.
  
  
• Accessible Solution: Most people already have a mobile phone that can receive text messages. That makes SMS one of the easiest forms of extra security to roll out, especially for beginners.
  
  
• Cost-Effectiveness: For small businesses and startups, SMS authentication is a cheaper option than building or buying complex security tools.
  
  
• Widespread Availability and Ease of Use: You don’t need to learn how to use an app. If you can read a text message, you can use SMS authentication.

Cons

• Lack of End-to-End Encryption: Text messages are not always protected during delivery. That means hackers might be able to intercept them.
  
  
• SIM Swapping and Number Hijacking: Criminals can trick phone companies into giving them control of your number. Once they do, they receive your codes and can break into your accounts.
  
  
• Vulnerabilities in SS7 Protocol: The SS7 system, used by telecom companies to send messages between networks, has known security flaws. These can be exploited by attackers to read your messages or reroute them.
  
  
• Phishing and Smishing Campaigns: Hackers can send fake messages pretending to be from banks or services. If you reply to or click on fake links, they can steal your codes and passwords.
  
  
• Risks from Lost or Stolen Phones: If someone gets hold of your unlocked phone, they can easily access your text messages and the codes inside them.
  
  
• Mobile Network Dependency and Coverage Gaps: If you’re in a place with no signal or traveling abroad, you might not receive your SMS codes in time or at all.
  
  
• Hidden Operational Costs and Scalability Issues: Sending millions of text messages can get expensive for companies. Managing phone number updates and delivery failures also adds technical headaches.

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Real-World Examples & Impact of SMS Authentication Vulnerabilities

These incidents demonstrate how attackers have exploited weaknesses in SMS-based authentication to compromise accounts and systems.

Coinbase SIM Swap Attack (2021)

Coinbase, one of the biggest crypto platforms, gave us a look behind the scenes of a fraud that cost Americans over $5.8 billion, and more than 42 million people were affected by identity theft and scams. And one major weak spot? SMS-based authentication. It shows how your choice of two-factor authentication (2FA) seriously affects your account’s safety. Most users still rely on text messages for that second step. However, SMS can be hijacked through SIM swap attacks, letting attackers steal your phone number and access your accounts. In fact, while only 5% of users use these stronger methods, they hold over half the assets on Coinbase.

Twitter Bitcoin Scam (2020)

The 2020 Twitter account hijacking exposed significant vulnerabilities in social media security, particularly through SMS-based two-factor authentication (2FA). Hackers exploited social engineering tactics to gain access to over 130 high-profile accounts, including those of Elon Musk and Joe Biden, and used them to promote a Bitcoin scam. This breach highlighted the weakness of SMS authentication as hackers intercepted codes to bypass security. The incident revealed how easily a vulnerable authentication method can be manipulated, leading to widespread financial damage.

MetroPCS Customer Breach (2019)

MetroPCS, part of the broader T-Mobile networks, was responsible for a data breach and was involved in a compromise of information for up to 54 million accounts. Although no financial data or Social Security numbers were exposed, the breach still compromised customer details, including names and phone numbers.

SMS-based authentication relies on phone numbers to verify user identity when logging into accounts or making transactions. If a bad actor gains access to your phone number or account PIN, they could potentially bypass SMS authentication and gain unauthorized access to your account. In this case, the exposure of customer data, including account PINs, raises concerns about the safety of SMS-based authentication as a secure method of verifying identity.

SMS Authentication Best Practices

To make sure SMS authentication is as secure as possible, it's important to follow some simple best practices that can help protect against threats:

Use Multi-Factor Authentication (MFA)

Multi-Factor Authentication (MFA) adds an extra layer of security by asking for more than two ways to prove your identity. This makes it much harder for attackers to get in, even if they have your phone number.

Teach Users About Phishing and Smishing

Phishing (fake emails) and smishing (fake SMS messages) are common ways hackers trick people into giving away personal information. It's important to teach users how to spot these suspicious messages. They should know not to click on links or share personal details via text, especially if the message feels urgent or unexpected.

Use Risk-Based Authentication

Risk-based authentication looks at factors like where you're logging in from, what device you're using, and what time it is to judge how risky the login attempt is. For high-risk situations, like logging in from an unfamiliar device, extra steps such as fingerprint or face recognition can be required to verify identity.

Set Up Continuous Monitoring

By keeping an eye on user activity in real time, you can quickly spot anything unusual that might suggest an account has been hacked. Alerts and regular checks help you act fast and prevent a problem from getting worse.

Create an Incident Response Plan

If something goes wrong, you need to be ready. Having a clear plan in place helps your team respond quickly if there’s an issue with SMS authentication. This reduces the damage and helps you recover faster.

Add Extra Security Measures

Consider adding more security features like checking the device you're using, blocking suspicious IP addresses, or using challenges like CAPTCHAs. These added layers of security, combined with SMS, help make your accounts even safer from attacks.

Bonus Tip: Guardio helps you enforce these best practices by detecting missing 2FA, alerting you to login exposures, and guiding you to safer authentication options with easy, actionable steps.

More Secure Authentication Methods

While SMS is commonly used for two-factor authentication, there are safer and more reliable alternatives worth considering:

1. WhatsApp OTP

WhatsApp OTPs leverage the app’s end-to-end encryption (E2EE) layer, which prevents interception at the transport layer, unlike SMS, which is vulnerable to SS7 attacks or SIM swap exploits. However, device compromise (e.g., rooted Android) can still expose OTPs unless app sandboxing is enforced.

2. Email OTP

Email-based OTPs typically use TLS for transmission but are only as secure as the email account's own protection (2FA, phishing resistance, SPF/DKIM/DMARC enforcement).

3. Biometric Authentication

Biometric data (e.g., fingerprints, facial features) is captured and matched via secure hardware like Trusted Execution Environments (TEEs) or Secure Enclaves. Modern implementations use FIDO2/WebAuthn to avoid transmitting biometric data over the wire, relying instead on local cryptographic challenges.

4. FIDO2 (Fast Identity Online 2)

FIDO2 uses a client-side authenticator (built-in or external, like a YubiKey) to perform public key cryptography. On registration, the client generates a key pair, stores the private key in a secure element, and registers the public key with the relying party. No secrets are stored on the server side, and credentials are origin-bound, which reduces the risk of phishing attacks.

5. Voice Call Authentication

Similar to SMS in vulnerability, voice call OTPs rely on telephone networks susceptible to SS7 exploitation, SIM swaps, or VoIP interception. TTS (text-to-speech) systems usually generate OTPs server-side and deliver via PSTN/VoIP, adding latency and introducing man-in-the-middle risk in poorly secured networks.

6. Physical Tokens

Hardware security modules use ECDSA or RSA key pairs generated and stored inside tamper-resistant chips. These tokens support challenge-response authentication and are immune to phishing, credential replay, and man-in-the-middle attacks if origin-checking (WebAuthn) is enforced.

7. Authenticator Apps

Apps like Google Authenticator, Authy, or Microsoft Authenticator generate time-based codes on your phone. Since they don’t rely on your mobile network, they’re safer than SMS and can work even when offline. Not sure which of your accounts still rely on outdated methods? Guardio helps you identify where you’re still vulnerable and nudges you toward stronger, more modern authentication options.

Guardio’s Approach to Secure SMS Authentication

Guardio believes that true security doesn’t start with the code you receive, but well before that, by identifying risks, detecting leaked data, and actively blocking phishing vectors before they even reach you. It helps keep you safe by blocking links in scam texts, making it harder for hackers to steal your login details through SMS. Instead of focusing only on the SMS itself, it protects the entire authentication journey.

Guardio also monitors for early warning signs that your personal information may be exposed, like when your login credentials appear in a data breach, or your phone number gets linked to suspicious activity. It adds an extra layer of defense by actively blocking malicious links often embedded in phishing texts, reducing the risk of SMS-based credential theft.

If you’re using an account without two-factor authentication or relying solely on SMS, Guardio will guide you with simple steps to tighten your security. The main mission is to build a protective layer around you, not just your login. SMS codes are just one signal; Guardio keeps you safe across devices, accounts, and online platforms.

Conclusion

While SMS authentication offers a basic layer of security beyond traditional passwords, it is increasingly vulnerable to modern threats such as SIM swapping, phishing attacks, and weaknesses in telecom infrastructure.

As digital threats evolve, relying solely on SMS is no longer sufficient for robust account protection. Stronger alternatives like authenticator apps, biometric verification, and FIDO2-based hardware keys provide significantly better security. Solutions like Guardio help users identify outdated authentication methods and reinforce their digital defenses.

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