Cryptocurrency Investors – A Prime Target for Hackers
July 12, 2018 12:35 pm
Cryptocurrency exchanges have boosted their overall security in the wake of cyber-attacks and scams. Cryptocurrencies collectively account for billions of dollars in the market. Starting with Bitcoin, other currencies have also received positive sentiments from investors.
As the trading boom grows, a lot of new users are allocating funds to cryptocurrencies to generate profits. Most new users are inexperienced and are the prime target for these attacks. In fact, hundreds of millions of dollars worth of cryptocurrencies have been stolen in the past year.
“The types of people who are starting to use and buy Bitcoin are much less technically sophisticated now, and so are much more prone to phishing attacks.” – Tom Robinson, CEO and Co-founder Elliptic (London)
Based in London, Elliptic is a company that is dedicated to preventing crimes in the cryptocurrency domain.
Since the beginning of 2018, Elliptic has observed over 5x increase in phishing attacks. These attacks are carried out by hackers to trick users into sharing their personal information and wallet details. This is usually done by creating a similarly named dummy site which can record the user’s entered information for misuse.
“You’re entering your credential into a bad site, and you don’t even notice. If you’re looking at it on a smartphone, which people often are when using cryptocurrency wallets, it’s even easier not to notice.” – Jeremiah O’Connor, Senior research engineer, Cisco.
Exchanges too are at risk, since the beginning of Bitcoin 8 years back, around 1 million BItcoins have been stolen, 6% of the total circulated coins. The estimated price of 1 million coins is about $7 billion.
Exchanges are moving away from the use of digital wallets due to the increase in attacks. One way to achieve this is by hiring specialized business entities that store coins offline in physical vaults.
“[Cyber criminals] are always coming up with new ideas… so we’re constantly trying to anticipate that. It’s an ever-escalating arms race.” – Ted Rogers, President, Xapo.