To fight ransomware hacks drain the cryptocurrency swamp

This kind of digital extortion – increasingly viewed as terrorism – would be impossible without the ability to move money around anonymously

Last month, a cybercriminal group penetrated the Colonial Pipeline. This wasn’t just “another” hack, with privacy consequences and threats on personal information. The severe results were shown instantly. Gas supply to millions of Americans was disrupted leading to a spike in gas prices and panic buying causing local fuel shortages in the southeast, and resurfacing old memories of the infamous gas crisis in the US in the late 1970s.

It becomes evident, and not for the first time, that ransomware has the potential to affect the personal lives of innocent citizens tremendously. The problem is worsening by the day as groups improve their ransomware code and collect easy money.

The US authorities responded – a national cyber investigative task force was formed and last night, DOJ told Reuters that US authorities will “give ransomware hacks similar priority as terrorism”. This begs the question, however: will it be possible to stop ransom hacks without treating its originator?

The fact is we’re not looking at this problem holistically. There is one factor making this problem possible, and systemic: cryptocurrency. Ransomware hacks thrive due to the possibility to transfer cryptocurrency easily, rapidly and without leaving traces. The criminals are not required to deal with complex transfers. Gone are the days where hostage-takers demand one million dollars in small-unranked-paper-bills, with a jet on the runway ready to take them to some foreign land where there’s no extradition agreement. All they need is a Bitcoin address, Monero, or ZCash, and a few command lines – and voila – the money lands safely at the hands of the criminals. It’s almost a sterile crime.

In fact, those money transfer machines enable the prosperity of a global crime industry, fueled by corporate extortion funds. For instance, in the case of the Colonial Pipeline, despite the involvement of the FBI and the law authorities, a five million dollar ransom was paid in order to free the systems. Some of the funds were recovered, in an unprecedented operation, and yet, the damage remained.

This is not pocket change. Each win – no matter how financially lucrative – builds on itself and gives these cybercriminals more confidence to fuel the next attack. For example, in dark web forums the phenomenon of “ransomware hack as a service” is gaining popularity, and criminals are offering ransomware for rent. The thieves have become so contented, that they are allowing others to use their tools, while they’re resting safely as ordinary software vendors.

In order to stop terror, we have to stop its funding. However, when it comes to ransomware hacks there is still no internalization of the fact that strict limitations should be put on its primary funding source – cryptocurrencies. The promise for liberty and freedom from censorship made by theoreticians in this field are shattered daily, and instead of a paradise for innocent civilians, we’re left with the opposite – a utopia for criminals. In fact, untraceable cryptocurrencies are the swamp in which the disease of ransomware flourish.

This swamp must be dried up. If governments around the world seriously intend to stop the phenomenon of ransomware hacks, they have to put strict limitations on money transfers via crypto currencies. They must supervise cryptocurrencies the same way they do with cash, bank transfers, diamonds or weapons. Countries should demand users to expose their money sources and prevent them from doing major deals not conducted through the supervised international banking system.

Governments should also implement methods of tracking cryptocurrencies and sound the alarm when illegal activity is detected. If they cannot decide on or implement a system to administer this, governments should consider the unpopular step of complete prohibition of holding and trading cryptocurrency. Drying up of the funding sources for these attacks may be the only viable approach to stop their continued proliferation. If we do not take immediate action to dry those swamps, we will find ourselves in the near future too weak and too ill to recover.

Originally posted on Times of Israel