Should you stock up on Bitcoins to pay for future ransomware attacks?

  • Business
  • Friday, 19 May 2017

" ...fear has driven some companies globally to stockpile cryptocurrencies to pay for future ransomware attacks. Would you do the same?"

LAST Friday’s WannaCry ransomware wreaked havoc across the world and made some cry.

The scare started on Friday morning and by the end of the day, 57,000 computers across the globe had been infected by this Trojan Virus. By now, over 300,000 systems in over 100 countries are known to have been compromised.

From hospitals to individuals and companies have seen their data being compromised, although the real extent of the damage is still not known and the attack has not completely stopped.

Users that were locked out of systems include Chinese government agencies, Deutsche Bahn, Nissan Motor Co and Renault, FedEx Corp, hospitals in Britain, Spanish telecoms and the Russian Interior Ministry.

WannaCry is a malware that encrypts your files and makes it impossible to gain access to content on your computer unless you pay a ransom.

Paying ransom to recover your data is not a new tactic. It has existed since 1989 when floppy disks were in vogue.

According to IBM, the rise in ransomware spam in 2016 reached over 6,000% from 0.6% spam e-mails in 2015, and the situation is only worsening.

In the past, about 70% of businesses impacted by ransomware paid cyber criminals to regain access. Cyber security company Symantec found out that 64% of Americans were willing to pay a ransom versus 34% globally.

There have been many versions of WannaCry, but by far, this is the biggest and most severe.

Governments around the world and cyber security firms are still trying to make sense of what hit the computers. They are also trying to find out who is behind the attacks.

Could this be the work of an established network of criminals, hackers or just bored teenagers?

It would be a challenge to find out, but whoever it was held hundreds and thousands of computer data files hostage unless users paid a US$300 to US$600 ransom via Bitcoin, a popular digital currency.

Bitcoin is the mother of all cryptocurrencies. It was trading at an all-time high of over US$1,800 a coin just before the attack. After the attack, it fell, but has since regained ground.

So far, about 215 payments totalling US$80,000 have been made to online wallets linked to the attacks. Surprisingly, it is not big money compared to the stress, anguish and panic it caused the world.

But who are the owners of these wallets? Finding out is going to be a long journey, as while some say Bitcoin transactions are transparent, others say cyber criminals prefer Bitcoin as payment because of its near-anonymous nature.

For now, the ransom payments are drying up, but is there enough safety nets to avoid another attack, and what to stop them from demanding more?

This fear has driven some companies globally to stockpile cryptocurrencies to pay for future ransomware attacks.

Would you do the same?

The move could also push cryptocurrency prices higher, although analysts had before the attacks predicted that Bitcoin could rise to US$3,000 a coin by year-end.

How do you buy Bitcoins?

There are over 44 exchanges globally, over 700 different types of cryptocurrencies. But in Malaysia, there is none. Those who own some buy it through Singapore.

It is not physical money, you can’t touch or hold it. It is virtual money and you need an online wallet to store it, or you can store it in your computer. In some countries, there are ATM machines where you can buy Bitcoins. One Bitcoin is worth over US$1,800.

Bitcoin and other digital currencies are finding themselves unwillingly in the limelight following the global WannaCry attacks. But all this could also push central bankers and regulators to start scrutinising these currencies and tighten regulations.

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