In this article, we will look at recent developments in cryptocurrency, from a regulatory perspective and developments in cybercrime adoption.
Cryptocurrency is hot. According to coinmarketcap.com, there are now over 1300 cryptocurrencies with new initial coin offerings (ICOs) accelerating all the time. We are seeing the beginning of regulatory acceptance as the British territory Gibraltar’s Financial Services Commission offers a new regulatory framework for Distributed Ledger Technology (DLT). The new framework will become operational as of January 2018 and will regulate the activities of firms operating in or from Gibraltar that use DLT to store or transmit value belonging to others, such as virtual currency exchanges.
Distributed Ledger Technology
In a discussion paper released by the British government, a distributed ledger is essentially an asset database that can be shared across a network of multiple sites, geographies or institutions. All participants within a network can have their own identical copy of the ledger, and any changes to the ledger are reflected in all copies in minutes, or in some cases, seconds. The assets can be financial, legal, physical or electronic. The security and accuracy of the assets stored in the ledger are maintained cryptographically through the use of ‘keys’ and signatures to control who can do what within the shared ledger. Entries also can be updated by one, some or all of the participants, according to rules adopted by the network. Blockchain, the underlying Distributed Ledger Technology used by Bitcoin, is the best know. More on DLT from the UK Government Chief Scientific Adviser.
Currently, the price trajectory of Bitcoin is higher than a North Korean rocket, and Blockchain is saving the world, one application at a time. It will be interesting to see how increased regulation impacts the value of Bitcoin and its rivals.
Cryptojacking payloads look set to become a mainstream attack in 2018. We may even see this method of monetisation, which requires the victim to do nothing, take over from current ransomware options that require victims to actively make the ransom payment.