Bitcoin Heist Halts Trading On Hong Kong’s Bitfinex

Aug 05, 2016

Bitcoin Heist Halts Trading On Hong Kong’s Bitfinex

BY Andrew Burton

Cybersecurity Ransomware

Bitcoin value dropped by 15 percent on Wednesday before rebounding, following a security breach of Hong Kong-based bitcoin exchange Bitfinex that netted hackers approximately $65 million.

According to Bloomberg Technology, the exchange halted trading, withdrawals and deposits after discovering the security breach in which 119,756 bitcoins were stolen. In a statement on its website, Bitfinex said it is undertaking a review to determine which users have been affected by the breach and that it is cooperating with law enforcement. The statement also said the breach was limited to bitcoins. Other digital tokens traded on the exchange were unaffected.

This is just the latest in a long list of Bitcoin heists. Bitcoin theft is common largely because transactions are irreversible, making theft nearly impossible to trace. 

The digital currency has been in the news a lot this year, but for its part in a different type of cyber crime. Bitcoin is the preferred payment method of criminals conducting ransomware attacks, because of its anonymity. Extortionists used ransomware to rake in an estimated $325 million in 2015, and its use is on the rise. Reports indicate that ransomware attacks have netted $200 million in the first half of 2016.

Late last year, the FBI said there’s little law enforcement can do to retrieve data following an attack and that people should just pay the ransom and move on. The organization has since walked this statement back, urging a strategy of education and data protection.

We’ve been watching the ransomware closely over the past year, and will continue to as the malware continues to evolve. Ransomware is a low risk/high yield crime, one reason it has become so popular among cyber criminals. The other is that it’s easy. Today, there are even ransomware as a service options, allowing just about anyone to extort money from victims.

To learn more about what you can do to protect against ransomware attacks, check out Datto.com/ransomware.

 

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