Any unregulated market is rife with corruption and crime, as criminals seek to extract as much value as they can before regulators step in to protect consumers with laws and guidelines. Crypto, as an unfamiliar technology for most investors with an added guise of anonymity, has only made the market and its participants the perfect targets for theft by cyber criminals. A new report from a cybersecurity company shines a spotlight on just how true that is – with over $1.1 billion in cryptocurrencies having been stolen during the first half of 2018.
According to cybersecurity firm Carbon Black, not only was such a large total sum of crypto stolen this year thus far, but apparently crypto-theft is really “easy.” The report says that cyber criminals use the dark web to steal from any of the 12,000 marketplaces and 34,000 offerings available across the crypto industry. The dark web can only be accessed using special software, but it makes cybercriminals virtually untraceable.
Carbon Black strategist Rick McElroy explained:
"It's surprising just how easy it is without any tech skill to commit cybercrimes like ransomware.”
McElroy says that it is not always “large nefarious groups” committing these crimes, but often highly trained engineers that are looking for other avenues to generate income. McElroy added:
"You have nations that are teaching coding, but there's no jobs. It could just be two people in Romania needing to pay rent."
Exchanges were the most likely target at 27% of all thefts in 2018, but individual investors are still at risk. McElroy advises:
"A lot of people are unaware in this new gold rush, people are using cloud wallets and not securing their money.”
For the individual user, the best way to avoid becoming the victim of a cryptocurrency-related cyber attack is to secure assets via cold storage, either through a paper wallet or hardware wallet. Investors should also make sure their computers are clean of any malware, and double-check all addresses before sending any funds. In addition, it is recommended not to keep any assets on exchanges as they are often the target for such attacks.