More and more, we are seeing instances where criminals are sending emails either threatening to release personal or embarrassing information and more recently scammers have begun threatening to do harm to the victim or their business, demanding up to $20,000.00 in Bitcoin.
People forget that the technology that makes Bitcoin possible, Blockchain Technology is a digital ledger, think notebook, that records transactions that take place in the Blockchain.
This includes Bitcoin transactions done for illegal purposes. There are many who still believe, mostly due to how the media portrays Bitcoin and CryptoCurrency, that Bitcoin is anonymous, when in fact Bitcoin is pseudo-anonymous.
Bitcoin would be anonymous as long as the person or agency looking to find who the transactions belong to do not dedicate money and resources to find out as with the Coinbase/Neutrino debacle. Bitcoin would be anonymous as long as the user does not use Bitcoin to Fiat exchanges as more and more of these require KYC (See my article on Exchanges). Bitcoin would be anonymous as long as the user does not broadcast on social media that they have or use it.
But what mainly keeps Bitcoin from being anonymous is the fact that the Blockchain that Bitcoin is based on is open and permissionless which means anyone at any time can view it.
So how does this fit into Cyber Security and Cyber Awareness?
I recently did a video on Phishing Scams to see how successful they are, I took Bitcoin addresses that clients received in phishing/scam emails and used the explorer tool on Blockchain.com to see the transactions.
Some people do send Bitcoin to the criminal addresses in the hope of avoiding any issues but my advice to anyone who receives these emails, do not respond and most certainly do not send any Bitcoin to them as there is no guarantee that the threats will stop or in cases where data is compromised, that the criminals will not release the data anyway.
The idea of a Phishing attack is just that, fishing. You throw out a net and see who you catch or in this case, who responds. The Bitcoin they receive is the catch of the day.
The most important thing that can be done to combat this type of Phishing Scam is to educate ourselves, our employees and our families about what Phishing Scams are and how they work. To not click on random links or attachments that would open their computer or company up to Ransomware Attacks and if they receive an email claiming to be from a financial institution or government agency, to call directly, not using the information provided in the email but going through the agencies official website or Wikipedia page.
Unfortunately, there is no way to protect ourselves 100% as long as we are connected to the Internet but awareness is the first line of defense that all of us can use, starting NOW.
U.S. Department of Homeland Security Cyber Security Division: http://bit.ly/2Y1P48a
U.S. Department of Homeland Security, Be Cyber Smart Campaign: https://www.dhs.gov/be-cyber-smart
Business Insider: Bitcoin scammers are sending bomb threat emails to millions around the world, but authorities are confirming ‘NO DEVICES have been found’ https://read.bi/2Qv4bXK
Fox News: New scam tries to blackmail with bogus porn threats https://fxn.ws/2QQETml
Coindesk: Bitcoin Trader on US Sanctions Blacklist Says He’s Innocent https://bit.ly/2AQLPFV
Bitcoin Magazine: Is Bitcoin Anonymous? A Complete Beginner’s Guide https://bit.ly/2ildwk8