Cryptocurrency crime wave could be dead ahead

Sunday, January 7, 2018
By Paul Martin
6 Jan, 2018

It’s never been a more bullish time for crypto investors. Despite the recent correction, the army of digital currencies led by bitcoin demonstrated incredible growth in 2017. But their rise in value could trigger a crime tsunami.
Along with the unprecedented surge in value, cryptocurrencies saw an equally unprecedented number of controversies. In December, the US Securities and Exchange Commission acted for the first time to halt a fast-moving Initial Coin Offering (ICO) fraud that had raised up to $15 million from thousands of investors by promising a 13-fold profit in less than a month. The same month, leading cryptocurrency exchange Coinbase suspended trading due to suspicions of insider dealing.

While fraud, as well as insider trading, are seen as inherent risks for digital currencies, it is still hacking that poses a far more severe threat for investors eager to gain from the new asset. Cyber-theft is increasingly widespread and extremely difficult for the average person to avoid.

Cybercrime has been a sore point in the industry from the very beginning. Nearly 33 percent of bitcoin exchanges were hacked between 2009 and 2015, according to a report from the US Department of Homeland Security, published in 2016. The agency also highlighted one-off scams and attacks on individual investors throughout that time.

However, if bitcoin and its peers continue to grow despite the recent plunge in value, it may trigger many more hacker attacks, as cybercriminals go where the money is, and the money is definitely in bitcoin at the moment. Cyberheists are highly profitable with a single attack able to bring in millions of dollars. So, a further surge in crypto markets may lead to the extension of traditional malware operations beyond banking Trojans, ransomware, carding, with cryptocurrency investors expected to fall victims as well.

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