Bitcoin and other cryptocurrencies have become a routine part of today’s cyber attack landscape.
The press is awash with cryptocurrency. Reports on the all-time highs, the billionaires who jumped on the bandwagon early, and the news that the likes of Goldman’s are setting up trading desks to exploit the wave are rife.
And there are certainly hotspots in the world influenced by the relative stability of the currency. In some countries it’s seen as an economic saviour. A way to keep economies trading when there is a lack of cash and the potential for criminals to create black money and instigate corruption – places like India where people can queue for hours to get money from an ATM. It is an easy way to move money.
We’ve also seen government intervention cause an interest in bitcoin. China is a prime example. The Government has sought to keep currency and prevent “capital flight” from the country. Some say that a large percentage of the trade in Bitcoin is happening in Asian exchanges. According to research firm Rhodium Group, $762 billion exited China in the first 11 months of 2016. Rumours of China attempting to restrict Bitcoin caused a sudden sell-off in early January last year. Speculation is that the fall of the Yuan brought a sudden rise to Bitcoin.
And here we are today with personal finance reporters educating their readers on the virtues, while others, like Stephen Roach from Yale University, say the currency is toxic believing the vertical trajectory of its value, and all time high, will bring about a downfall.
The underworld is just as busy. Hacks and scams have hit the larger trading markets and things have escalated in recent days.
As leading bitcoin exchanges typically excel in service availability, some users have turned into full-time traders, as they have a platform to store and trade thousands of dollars of cryptocurrency in real time. This increased attention is creating profitable opportunities for cyber criminals – the most high profile case was of course the WannaCry campaign, which locked up computers around the world demanding bitcoin exchanges for a decryption key. And only last week, BitConnect announced it was under heavy fire from hackers just one of the reasons suggesting it would close its exchange. It’s spooked investors.
Several crypto-currency exchanges around the world have experienced outages related to either a flood of natural traffic due to market fluctuations and demand, or malicious traffic from denial-of-service attacks. In particular, last summer both Bitfinix and BTC-e announced that their networks were experiencing service degradation due to a denial-of-service attack. Coinbase reported experiencing issues with load times that resulted in users not being able to login or view the websites of the targeted exchanges.
We all know that system overloads need to be avoided so that traders’ real-time market interactions are not interrupted. When a trading platform goes down, users are unable to access their wallets and fear that Bitcoin’s value will fluctuate, resulting in the company suffering reputation damage.
However, recent hacks have caused the market to wobble more than usual. Some argue that the ‘slump’ that it’s prompted will be good for the currency and steady things.
Talk to CIOs of businesses trying to defend themselves from cyber attacks and they really don’t care about the market price of a Bitcoin. If there’s value in it, there’s value for a hacker and that’s become an urgent concern for anyone leading an IT organisation.
In fact, the percentage of companies reporting financially motivated cyber-attacks has doubled over the past two years, with 50% of companies experiencing a cyber-attack motivated by ransom in the past year, up 40% from the year before. A quarter of security execs think ransom will the greatest threat to their business this year.