How can you track hacked cryptocurrencies

Blockchain

Early on, Bitcoin and blockchain enthusiasts wondered whether the cryptic nature of the virtual currency and its underlying platform are strong enough to withstand the tactics of criminal hackers.

The answer to this question was not long in coming: Like all computer-based things of value, cybercriminals were quick to target both Bitcoin (and other cryptocurrencies) and the blockchain. Since then, several hundred million dollars in cryptocurrencies have been stolen through repeated hacking attacks. We target some of the nastiest cyberattacks and attack tactics related to Bitcoin and blockchain and tell you how to protect yourself - and your cryptocurrencies.

Bitcoin Miner Malware

Every bitcoin created or "mined" makes it difficult to mine new bitcoins. The largest cost factor is the operation of special mining systems. For this reason, quite a few Bitcoin miners "borrow" resources for mining the cryptocurrency. For example, by using computers at work or by spreading mining malware. Today, many of the largest malware botnets are only there to mine bitcoins. In a recent study, the security provider Check Point Software came to the conclusion that 55 percent of all companies worldwide are now infected with malware that is supposed to mine cryptocurrencies.

Certainly there are worse goals that can be pursued with malware - nevertheless, such a "strategy" still represents an illegal / criminal use of computer systems and costs the victim money. In addition, the malware naturally also eats the computing power of the infected computers. You should defend yourself against the mining malware like any other malware.

Compromised crypto wallets

Cryptocurrencies are usually stored in data safes - so-called wallets. These virtual wallets can be compromised, tampered with or stolen - just like any other data of value that resides on a computer system. But you don't have to be hacked to get rid of your Bitcoin wallet: If you forget your password or lose the hard drive on which the data is stored, your cryptocurrency inventory is usually lost forever. The same horror scenario can also be triggered by ransomware. Because, unlike a traditional bank account, you cannot simply log in via another computer to access your holdings. Once the Bitcoin wallet is gone, it's gone.

  1. Ethereum
    Another cryptocurrency based on the blockchain principle. Provides a platform for programmable smart contracts. The "ethers" are seen by fans as the legitimate successors of the Bitcoins (see also the picture above).
  2. Cryptlet
    Service developed by Microsoft for the Azure cloud, with the help of which users can enter external data into a blockchain without destroying its security and integrity. As individualized middleware, cryptlets can also be developed by Azure users themselves - in any programming language - and are intended to bridge the gap from the blockchain to new business services in the cloud.
  3. Cryptocurrency
    Digital money, without coins and bills. With the help of cryptography, a distributed, secure and decentralized payment system is built. Does not need banks, but computing power and technical aids such as the blockchain.
  4. Blockchain
    A blockchain is a decentralized database that keeps a constantly growing list of transaction data records. The database is expanded linearly in chronological order, comparable to a chain, to which new elements are constantly being added at the lower end (hence the term "blockchain"). When a block is complete, the next is created. Each block contains a checksum of the previous block.

    The technical model of the blockchain was developed in the context of the cryptocurrency Bitcoin - as a web-based, decentralized, public accounting system for all Bitcoin transactions that have ever been made.
  5. Bitcoin Core
    The open source software validates the entire blockchain and was approved at the beginning of 2009 by a certain 3220391 "target =" _ blank ">" Satoshi Nakamoto " published under the name" Bitcoin ". Bitcoin Core was initially programmed in C ++ primarily for Windows systems. Porting to GNU / Linux followed a little later. Because the developers fell out, there are now some derivatives of Bitcoin software, including Bitcoin XT, Bitcoin Unlimited or Bitcoin Classic.
  6. BigchainDB
    The "scalable blockchain database" can manage up to a million write operations per second, store petabytes of data and still have a latency of less than a second - all of this managed in a decentralized manner and with the highest data integrity. The technical basis is blockchain technology.
  7. Distributed ledger
    Financial term for "distributed account management". Bitcoin is a completely new technical approach to distribute information about certain mappings. There is no longer a classic account that is managed centrally at a bank, but "account management" is based on a network of communicating systems.
  8. Smart contract
    A computer protocol that can map or check contracts or provide technical support for the negotiation of a contract. Could replace the written contract in the future.
  9. R3CEV
    The startup R3 CEV is building the blockchain-based "Global Fabric for Finance". The largest blockchain in the world is to be developed with around 50 financial partners - a first test run with eleven major banks, including Barclays, Credit Suisse, HSBC, UBS and UniCredit, has already been successfully completed. R3CEV has entered into a strategic partnership with Microsoft to develop blockchain infrastructure and technology in the Azure cloud.
  10. Ripple
    An open source protocol for a payment network - currently still in development. P2P payment method and foreign exchange market in one, based on the crypto currency "XRP". However, Ripple users are not limited to this one currency, but can use any currency - for example, euros, dollars or yen.

The majority of experts advise owners of cryptocurrencies such as Bitcoin and the like to save in an offline wallet that cannot be attacked by malware or hackers. On the other hand, this can mean that you can no longer use your crypto assets so easily: It can take a few days before access is possible or an update is carried out. If you want to use an online wallet, you should use multi-factor authentication if possible.

Transfer Trojans

There are crypto Trojans lurking in your computer. Until they register a cryptocurrency account number. When the time comes, the Trojan horse "wakes up" and replaces the account number to which you want to send Bitcoins with a new one. If you don't take a close look here (and at the right time), the bitcoins will be history when you press the send button.

Implementation vulnerabilities

"In theory there are no differences between theory and practice. In practice there are." It is not known who first made this statement. It was first printed in "Pascal: An Introduction to the Art and Science of Programming" by Walter J. Savitch.

As with any crypto implementation, the underlying cryptological algorithm is usually much more stable than the software that implements it. In general, the vulnerability of a blockchain stands or falls with that of the cryptographic solutions. A bug in the program code or an improperly chosen private key can bring the whole construct down. Of course, it's hard to tell before you really dig deep into a cryptocurrency or a blockchain project. You should therefore make sure that the software developers use SDL processes to minimize bugs.

There have been incidents in which criminal hackers have tried to manipulate the cryptocurrency software in order to steal assets. In at least one case, the attackers made a programming error that did not earn them any money, but ensured that all other wallets were also corrupted. In the end, all users were deprived of their crypto money.