Cryptocurrency And Issues With Cybersecurity
Cryptocurrency is showing no signs of slowing down during the pandemic, especially with its total value, which is approximately $2 trillion.
Cryptocurrencies or virtual currencies that operate on decentralised networks using blockchain technology have become more popular over the past ten years because of different factors. One factor that makes them popular is that central governments do not regulate these. Thus, in theory, they are not bound to be controlled by central authorities.
However, people might consider that the best factor in making investments is the potential these can provide to owners. Cryptocurrency fluctuates regularly, and its volatility can bring huge profits and losses for investors.
An example would be Bitcoin, which is the most popular cryptocurrency. In April 2021, it reached its highest market price of $64,000, suddenly dropping to $32,000 in just a few months.
Bitcoin comprises almost half of the cryptocurrency market; however, it is not the only crypto available, with approximately 1000 other tokens according to CoinMarketCap. However, because of this popularity, Bitcoin has caught the attention of people who plan to do illegal activities.
COPYRIGHT_WI: Published on https://washingtonindependent.com/ebv/cryptocurrency-and-issues-with-cybersecurity/ by Kenzo Norman on 2022-10-31T07:10:12.555Z
According to Action Fraud, there has been a rise in cryptocurrency scams in 2021, with an estimated 57 per cent rise. Cybercriminals illegally obtained £113 million from crypto owners last year, with a 140% increase compared to 2019. This shows that investors are not fully knowledgeable about the risks associated with investing their money in the market.
Scammers find cryptocurrency appealing because of its popularity and because many do not have full knowledge about the market. Scammers take advantage of the susceptibility of consumers. This happened recently with the squid token rug pull.
The Squid Game token, coined from the popular Netflix drama ‘Squid Game’, crashed to zero after a week’s rally of almost $2,800. The rug pull scam occurs when buyers are drawn to the promoter of a token, only to terminate the trading activity and then run away with the investors' funds. With the investors' money, the Squid Game token rug pull raked in approximately $2.5 million.
Typical of various online scams, the scam took advantage of the prevalent feeling of FOMO. During that time, the world was entrenched with the popularity of Squid Game during the launching of the token.
Clients must be wary of investments. They should be mindful of the risks that go together with cryptocurrency and work with cryptocurrency coins and exchanges that are peer-reviewed and established. New and experienced investors can protect themselves against crypto heists using tried and tested cryptocurrency platforms with a well-established history of good cybersecurity practices like Kucoin, Coinbase, or the Immediate Edge website.
There is no 100 percent guarantee about the security of even the most established crypto exchanges. Last year, cybercriminals victimised Poly Network when they stole more than £433 million.
Poly Network connects some of the world’s biggest lenders and traders in the crypto industry. A few days later, almost all of the hacked amount was returned. There is a greater possibility that this is not an attrition case but because of the difficulty of laundering cryptocurrencies due to its designed blockchain. Cryptocurrency is a different field in the financial market.
The hack on Poly Network is not the first. Binance, one of the world’s most established cryptocurrency exchanges, was hacked with over $41 million in bitcoins stolen.
The year prior, Coincheck was hacked by hackers and stolen over ten times more. Mt Gox, based in Tokyo in 2014, filed for bankruptcy because it was hacked with more than 850,000 bitcoins.
Cryptocurrency has indeed been highly appealing to cybercriminals for years. In ransomware attacks, Bitcoin and other cryptocurrencies are the modes of payment that hackers want to pay. This allows the hackers to move with anonymity.
Nowadays, cybercriminals are more attracted to hacking crypto wallets and exchanges. They are interested in following the money as there is a boost in the popularity of cryptocurrencies.