By Kimberly Connella   |   July 10, 2019   |   0 Comments

Bitcoin Ransomware: Online Extortion

Ransomware attacks have been on the rise since 2013. There are now over 500 families of ransomware and almost all of them ask for payment in Bitcoin.

Bitcoin provides a secure and anonymous payment method that cybercriminals can use to extort large sums of money from companies and governments alike. This makes it a perfect payment method for hackers.

Like many other technologies, Bitcoin has many legitimate uses but has nonetheless given cybercriminals an easy, cost-efficient, and safe way for their illicit activity to go untracked. These factors fuel the incentive for ransomware attacks.

If ransomware is asking you for bitcoin and you’re wondering whether to pay, see here.

Ransomware Attacks on the Rise:

In the last few months alone, cities in half a dozen states across the U.S. were attacked by ransomware that asked for large sums of money in Bitcoin.

In June 2019, ransomware hit three Florida municipalities—Key Biscayne, Lake City, and Riviera Beach. Lake City paid 42 Bitcoin (almost $500,000) and Riviera Beach paid 65 Bitcoin ($600,000) to hackers.  The hackers gave their files back after payment, but this isn’t always the case for every ransomware attack.

Hackers sometimes fail to restore access to an organizations’ data even after they pay the ransom. Furthermore, sometimes it puts a target on their back for other hackers to extort money from them.

Lake City mayor Stephen Witt told a local news station “I would’ve never dreamed this could’ve happened, especially in a small town like this.”

Other cities, such as Baltimore, refused to pay the ransom but sill paid a hefty cost to disinfect their systems. Baltimore’s budget office estimates the ransomware attack to cost at least $18.2 million in the coming year—a combination of restoring data and lost revenue.

After the attack, Baltimore shut down daily operations, critical city services, and inconvenienced thousands of residents for weeks.

In one report Charles Carmakal, CTO of FireEye Mandiant, raised concern about general public safety during cyber attacks on local governments.

“Hackers have been able to encrypt systems and encrypt data that are essentially critical to these cities,” Carmakal said. “If people call 911 and can’t get ahold of them, it could potentially kill people.”

Municipals and other industries, such as healthcare, are often targeted because of their outdated systems, lack of security, and willingness to pay the ransom. It can depend on the value of the data encrypted and the potential loss of revenue.

Bitcoin: Ransomware Payments Untraceable

Hackers were extorting money from individuals and companies long before crypto-currencies such as bitcoin came around. However, early hackers used traditional means such as pick up locations and the postal service to retrieve their payments. Later, they used third-party services such as PayPal and Western Union to wire money.

But they all had something in common: a paper trail law enforcement could follow.

Bitcoin fuels ransomware attacks because it allows cyber criminals to change their addresses over and over again for each ransomware attack. Companies and individuals can directly pay hackers the ransom with no loose ends.

Bitcoin allows hackers from all over the world to attack companies and governments and receive secure payments. Hackers have more incentive to demand higher payments because law enforcement can’t track or reprimand them.

Cyber Attack Prevention and Solutions:

The FBI’s official recommendation is to not pay when hit with ransomware. However, as Baltimore proved this spring, it can be far more costly to not pay. Each attack faces a different set of dilemmas when deciding whether to pay.

The best thing companies can do today is to be aware of their weaknesses, prepared in their protocols, and proactive in their defense. If you are hit, seek consult from cyber security professionals who can accurately determine the extent of the threat.

If you’re unsure about your organizations’ security weaknesses, take our free cyber security assessment or book a free consult.

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