It has long been known that if you want to participate in the Darknet marketplaces, you’ll need to exchange your money into Bitcoin. Bitcoin was written by someone using the alias Satoshi Nakamoto in 2008 as an anonymous and decentralized currency. We’ve written in the past about how to buy Bitcoin. Today, for various reasons, we are seeing it become mainstream.
Ransom attacks on companies are becoming big business. Many businesses say they will not pay, but when attacked, find that they do. But how do they pay? Bitcoin. Just like having insurance policies, companies are now investing in keeping Bitcoin around for business continuity against DDoS attacks as well as Malware CryptoLocker and Data Extortion attacks.
Ransom and extortion campaigns have proven to bring in big profits for the cyber attackers who have targeted the U.S. and the U.K. Here in Asia, I often run into the common misconception that an ISP is responsible for defending the customers. I’ve met with various companies that have yet to be attacked that have high value assets. My prediction for 2017 is that Asia Pacific will become ripe for cyber attackers to make a large amount of extortion money here.
Outside of cyber-attacks, there is still the criminal trading underground. We’ve seen the rise and fall and resurrection of online marketplaces for illegal drugs, like the Silk Road. As government agencies shut them down, two more pop up. It’s a giant game of whack-a-mole, and as this happens and the press continues to cover the arrests and presence of these marketplaces, more visibility is given to the existence of them. Teenagers are now finding a safer way to purchase drugs online by visiting the Darknet. As some governments in the Asia Pacific region have started executing drug dealers, a much safer anonymous marketplace exists. Bitcoin is the currency for anyone wishing to be involved in the online drug trade.
On the topic of safety, many see Bitcoin as the new gold. Market uncertainty often pushes people to move toward a safe haven. Bitcoin is being seen as a digital safe haven. Here in India, I’ve had the pleasure of standing in 3-hour long bank lines to use an ATM for a maximum withdrawal of ₹2,000 rupees per day (about $30 USD). After going across town to 2-3 different banks to find one that still actually HAD money in the ATM to dispense, I can see how the appeal of moving to another currency is very attractive. The Indian government made the demonetization move to stamp out black money and corruption. Bitcoin is simply the easier way for people to move their money (once they convert the cash, which has been the tricky part in India) globally.
We’ve seen a rise in Bitcoin usage in various countries, including China due to government restrictions. Foreign investment caps have been placed in China. 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. Rumors of China attempting to restrict Bitcoin caused a sudden sell-off last week. Speculation is that the fall of the Yuan has brought a sudden rise to Bitcoin.
With all of the factors listed above, this makes sense to me why the sudden surge and drop in Bitcoin. Targets are ripe and prime for extortion due to lack of security. Companies must buy bitcoins as insurance in case they aren’t completely battle-hardened and tested. Governments like India and Venezuela that are having demonetization issues are also causing part of the surge in Bitcoin usage. Today, Bitcoin is within a few dollars of its all-time high. Will we see Bitcoin at $2,000 per BTC in 2017? I predict that China will have to adopt Bitcoin and other cryptocurrencies to keep the population happy. I also predict that India will possibly become another large user in Bitcoin.
Download the “Cyber Ransom Survival Guide: The Growing Threat of Ransomware and RDoS – and What to Do About It” to learn more.
As Director of Security Solutions, David Hobbs is responsible for developing, managing, and increasing the company’s security practice in APAC. Before joining Radware, David was at one of the leading Breach Investigation Firms in the US. David has worked in the Security and Engineering arena for over 20 years and during this time has helped various government agencies and world governments in various cyber security issues across all sectors.