Cryptocurrency security – Are we really all as secure as we thought?

On the 17th May 2017 the NHS was brought to a standstill – the culprit? Not a winter crisis, ever squeezed budgets or an epidemic, but an IT attack. The ‘WannaCry’ ransomwear had effectively infiltrated systems that were critical for our essential National Health Service.

Now it has been found that a cryptocurrency miner held a similar hack to WannaCry, a programme that capitalised upon the same exploits – so it seems more than an apt time to ask – are cryptocurrency users really as secure as we thought?

The security of cryptocurrency – The road to today

Up until this point cryptocurrency users have been rightly confident in their choice of alternative for transacting online. After all, the technology on which cryptocurrency is based is incredibly advanced, secured by the peace of mind of multiple mining computers that make the theft of virtual currency seriously difficult, if not impossible.

Despite the realm of cryptocurrency having had previous hiccups and appearances in the news, such as the hacking of the Bitfinex cryptocurrency exchange in Hong Kong, until now there has been little attention placed upon other security breaches (this is despite hackers previously stealing millions of dollars in Bitcoin – the most surprising fact about which is that the hackers used only phone numbers to do so).

Two points of note – Hacker anonymity and a missing safety net

There’s something interesting about what attracts people to cryptocurrencies – that the core strength for many currencies is the fact that they offer complete anonymity. This is a hacker’s dream, a true ideal for the criminal IT underworld. Very few cryptocurrencies offer anything different, although there are exceptions, such as One Coin which provides ‘KYC’, or know your customer. In short this feature guarantees that any user will always know exactly who they’re dealing with, as each One Coin owner must register their details in full before purchasing even a single coin.

What’s also fascinating when it comes to security is the fact that cryptocurrencies lack any form of safety net – so if your coins are stolen, there’s no governing body or company to take ownership, protect you and reimburse your balance. You’re truly on your own, as opposed to the many bank and savings accounts that are protected by the Government’s £75,000 protection should the organisation crash, and the prospect of reimbursement should your balance be targeted by criminals. So, armed with these two facts, it seems even more pertinent to ask whether cryptocurrencies are secure.

The latest news – WannaCry and a cryptocurrency infiltration

The Windows vulnerability that was part of the WannaCry ransomwear was MS17-010, and it was this exact same vulnerability that the so-called Adylkuzz campaign focused on, which honed in on machines that were being used for the mining of the Monero cryptocurrency.

“Initial statistics suggest that this attack may be larger in scale than WannaCry[pt], because this attack shuts down SMB networking to prevent further infections with other malware (including the WannaCry[pt] worm) via that same vulnerability”

– Robert Holmes, vice president of products at Proofpoint

Monero is a currency placed alongside the likes of Bitcoin, which has been most infamously connected to the AlphaBay darknet, for the trading of drugs, stolen card details and counterfeit products.

“Once infected through use of the EternalBlue exploit, the cryptocurrency miner Adylkuzz is installed and used to generate cybercash for the attackers”

– Robert Holmes, vice president of products at Proofpoint

 

A staggering 52% of all businesses are still on Windows XP (2017 OS Adoption Trends/Spiceworks). However it would be pretty logical to presume that any cryptocurrency user is technologically savvy – that they understand the importance of security and that they’re generally owners of up-to-date hardware. All of which would lead us to think that very few cryptocurrency owners are still stuck on Windows XP – a product launched at the turn of the century and a piece of software that saw its official support finish as of 2014.

 

“For organizations running legacy versions of Windows or who have not implemented the patches that Microsoft released in March and last weekend, PCs and servers will remain vulnerable to this type of attack”

– Robert Holmes, vice president of products at Proofpoint

 

However it appears that cryptocurrency users aren’t universally on the most advanced and up-to-date of systems. The Adylkuzz campaign, which began 7 days prior to the WannaCry campaign, earned three cybercriminals $22K, $7K and $14K respectively, before mining ceased. And it may be that these are under estimations, as some experts say that much more than this has been mined. During the course of this campaign thousands upon thousands of computers would have been impacted.

 

“Once infected through use of the EternalBlue exploit, the cryptocurrency miner Adylkuzz is installed and used to generate cybercash for the attackers”

– Robert Holmes, vice president of products at Proofpoint

 

Moral of the story? The laziness to avoid upgrading from Windows XP most certainly extends into the realm of cryptocurrency, and action must be taken quickly if more hacks aren’t to be experienced imminently – after all, with no product support, no Microsoft patches or updates, these machines are practically left wide open.

A time of insecurity and unpredictability?

Whilst we’re on the topic of security, it’s worth saying that times are anything but predictable right now – the rise and rise of Ethereum (a cryptocurrency that garnered $150M of crowd funding), has risen in value up by 88% in just a single week – taking it up to $172.26 today, from January 1st when its value was just $8.15.

Bitcoin has also undergone a recent rise, up 7% as of today and standing at $2,211.56 with a market capitalisation of $36 billion. All in all, bringing this currency up 122% in the year to-date.

To flip these two rises and balance out our viewpoint, we also need to look to Ripple, the third largest of the alt-coins, which was powered up the markets by a 7000% rise, only to come crashing down again within a week – wiping $4 billion from its value.

So, just what’s going on? As Wolf Richter explains on Business Insider and succinctly summarises:

“Anyone creates a “cryptocurrency,” gets exchanges on board, hypes it, gets other players to pump in actual currency, and participate in this miracle of a digital number backed by nothing and representing nothing, with no coupon payment and no ownership of anything other than the digital token, hoping fervently to sell it back and forth among each other with the agreement to not ever try to convert it back into real currency because that would cause it to collapse – see Ripple”.

And so it seems that while we, as cryptocurrency users rightly re-consider the security of our transactions and trading, that the future of these markets is perhaps looking once again more like the early days where millionaires where created overnight. Exciting, unpredictable and ever-so-slightly intimidating times indeed!