Hackers stole about $60 million in cryptocurrency from Japanese cryptocurrency firm Tech Bureau Corp on September 14th. According to government investigators, many cryptocurrency exhanges in the country failed to properly safeguard client assets or did not implement effective anti-laundering measures in the recent past.
The recent spurt in cryptocurrency mining operations around the world has been aided by the availability of more tools and better mining algorithms in the hands of miners as well as lack of adequate safeguards being implemented by cryptocurrency trading platforms or exchanges.
Cryptocurrency firms not serious about cyber security
Earlier this year, Japan’s Financial Services Agency investigated how cryptocurrency exchange operators managed their client assets and if they implemented measures to check the theft of cryptocurrency. The agency found that many firms were found lacking in these two parameters and were thus vulnerable to mining theft. The theft of $60 million from cryptocurrency firm Tech Bureau Corp therefore comes at no surprise.
However, Ilia Kolochenko, CEO and founder of Hi-Tech Bridge, believes that since digital coins are extremely attractive for criminals who can easy launder them and convert into spendable cash, cyber criminals readily invest into additional efforts to break into servers owned by cryptocurrency exchanges even if security is properly implemented and maintained.
“Compliance does not necessarily mean security – major data breaches of PCI DSS certified merchants are not that unknown for example, likewise intrusions into organizations under even more rigorous regulatory and compliance requirements. Moreover, the vast majority of crypto-companies, including large crypto exchanges, are operating in a very turbulent, hostile and merciless market where a minor mistake can drive you out of business.
“Therefore, cybersecurity is rather complementary to their growth strategy. Some startups even ignore security and privacy, recklessly using out-of-the-box solutions, putting their customers’ assets at huge peril,” he added.
Cryptojackers posing a major threat to UK-based firms
The increasing profile of cryptocurrency mining has been such that, according to a report from Check Point, the percentage of organisations impacted by mining rose from around 20 percent last year to 42 percent worldwide in the first three months of 2018. Even though a disproportionately large number of exchanges in South Korea have been targeted in recent months, companies operating in the UK aren’t faring any better.
In March, a report from Symantec Threat Intelligence revealed that incidents of cryptocurrency mining in the UK rose by 1,200 percent in the previous few months, making UK the fourth-most targeted country for cryptojacking operations after the U.S., Japan and France.
For example, a massive cryptocurrency mining operation in February forced the government to shut down hundreds of websites belonging to the Student Loans Company, several NHS services, and local councils. The operation was carried out by hackers who compromised a widely-used browser plug-in to spread their web to thousands of websites and subsequently mined cryptocurrency using the processing power of infected devices.
“This method of thinking around how effective a ‘hack’ or ’attack’ is becoming more common, we are not seeing individual sites or companies being targeted, but common services, or ancillary third party plugins being targeted,” said Andrew Douthwaite, VP Managed Services at VirtualArmour, to Express.co.uk.
“This gives the attackers a much wider audience to hit at once, the third party companies developing the add-ons or additional services are generally smaller than the companies using them and therefore can be less stringent with their QA and security. Another example of this approach was the huge DDoS attack on the DNS provider Dyn – taking down, Twitter Netflix, Spotify to name but a few,” he added.