Through the current times, we’ve come to see that there’s no dearth of premium cryptocurrency projects that have genuine intentions. Still, investing in cryptocurrencies stays a matter in which both, businesses and investors need to indulge with caution.
With each passing day, cybercrimes centered on cryptocurrencies seem to gather momentum. This comes as a threat of significant proportions to governments, individuals, and organizations from all across the globe.
If we merely take the case of the first half of 2022, then, losses worth $2 billion have taken place in cryptocurrencies. This is a 60% increment on a YoY basis.
It hence becomes easy to see that for cybercriminals, cryptocurrencies indeed are one of the preferred areas of operation. The primary reason for the same is that cryptocurrencies are borderless and liquid. Correspondingly, cybercriminals can use cryptocurrencies to evade regulations and sanctions.
Another important reason that contributes to the effect is cryptocurrencies being pseudo-anonymous. This implies that the transactions, though traceable over the blockchain ledger after being documented, are irrevocable. Users are granted anonymity when conducting crypto transactions because crypto trades are not associated with personal identities.
In the case of crypto transactions, there is no centralized authority such as banks that can enforce AML/BSA standards. This makes cryptocurrency an easy target for crimes such as money laundering. In 2021, crypto worth $8.6 billion was laundered.
The cybersecurity industry nevertheless puts forth some optimism concerning the crypto market which has been slowing down at a stupendous speed. But, in reality, cybersecurity has not come by as a foolproof measure for fighting cybercrime.
A few of the patterns even demonstrate that as far as the crypto crime problem is concerned, the worst is yet to be. Let’s consider these trends in further detail:
Crypto businesses are becoming more vulnerable to cyber attacks by the day
The top targets for cyber attacks through the current times are personal wallets and crypto platforms and exchanges. This is primarily because they manage a significant amount of money.
Amid the phase of June 2021 and June 2022, the losses faced by crypto platform amounts to up to $44 billion. The key underlying methods for realizing the cybercrimes included SIM card jacking, manipulating unsecured wallets, and stealing recovery phrases or passwords.
As per FBI reports, the inclination of crypto scammers is fast turning towards Cryptocurrency ATMs. Merely in the previous year, 1,500 cases of crypto ATM fraud had taken place. The losses, herein, had amounted to $28 million.
The ones targeting crypto firms include criminals sponsored by the state. The funds stolen become means of sponsorship of war crimes and terrorist activities.
Crypto scams are more than they ever were earlier
Phishing is a trend that is skyrocketing in the terms of cryptocurrencies. Last year, YoY growth in crypto phishing scams registered a increase of 257%. The core methodology for conducting crypto phishing scams is as follows:
In the case of a few of the phishing campaigns, cryware is first downloaded. A few of the cybercriminals prompt users to first enter the seed phase, while others harvest user credentials.
There are, alternately, cases wherein phishing kits are bought from the dark web. In a typical phishing kit, you’d expect to find phishing emails, landing page templates, and websites, alongside credentials, hosting, and spamming collection services.
There are even cases wherein cryptocurrency support teams are impersonated by a few scammers. This is done to inspire the victims to share their login information, or attempts are made to get control of victims’ crypto accounts.
Ransomware attacks are rising
The general public opinion has been that as the value of cryptocurrencies decline, ransomware attacks are also going to reduce. But, in actual practice, studies go on to show, an exact opposite phenomenon is underway.
In July 2022, ransomware attacks increased by 47%. Similarly, during the first half of 2022, ransomware payments made were close to a million dollars.
It is noteworthy, here, that as much as 98% of ransomware payments were accounted for by Bitcoin. So, for the extortion-based attacks that take place in the future as well, the likelihood of Bitcoin’s application fading is close to negligible.
In the Dark Web, cryptocurrencies, today, are the de facto currency. For several illicit activities, virtual currencies are traded.
How should the organizations be working towards safeguarding themselves against crypto scams?
- Educate your employees and yourself
The origins of most crypto hacks lie in a phishing email or a social engineering scam. Your employees should be trained to be exceedingly cautious of messages and emails that appear to be dubious. One of the top examples of such messages is the ones that appear to be sent by your crypto exchange or wallet, and seem too good to be true. You may choose to use phishing simulations and real-world examples to train your employees to recognize dubious activities, which should then be duly reported.
- Leverage only the reputed marketplaces for conducting business
It is recommendable to take the services of only those marketplaces and exchanges that bring the best practices in security into their dealings and stringently follow regulations. It should be remembered that one stays vulnerable to getting hacked, irrespective of how sophisticated one may be. In contemporary times, Solana wallets lost crypto worth millions of dollars.
- Be ready with an incidence response plan at all times
Even while an organization is exceptionally security-savvy, it still stays vulnerable to cyber attacks. A contingency plan, hence, needs to be ready at all times. One of the top ways of going about it is to maintain backups. They’d come in to be handy in case a ransomware attack takes place. The odds of finding the stolen cryptocurrency money will be low. But when your exchange and the police are contacted, these odds will increase.
- A multi-layered defense is recommendable
The technical defenses in place at your organization should be robust. The procedures and policies, herein, should all be documented. Your employees should be well informed regarding their accountabilities and responsibilities when they transact online.
Laying trust in the face value of everything could be counterproductive. One always has to be wary when transacting online.
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