$220,000 of cryptocurrency stolen in virtual robbery - PC Retail

$220,000 of cryptocurrency stolen in virtual robbery

Attack joins shutdown of major Bitcoin exchange in twin setback for cryptocurrency fans
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Roughly $220,000 worth of digital currencies has been stolen in a botnet robbery.

The ‘Pony’ malware was used by criminals to infect and obtain the digital wallets of 85 cryptocurrency owners worldwide, operating from September 2013 to January 2014. The details of over 725,000 additional accounts were also taken.

Trustwave Spider Labs, which reported the theft, said that 355 Bitcoins, 280 Litecoins, 33 Primecoins and 45 Feathercoins were among the stolen currencies.

“Stealing Bitcoins and exchanging them for another currency, even a regulated one such as U.S. dollars, is much easier than stealing money from a bank,” warned Spider Labs researcher Daniel Chechik.

“Stealing money from bank accounts these days has become increasingly frustrating for cybercriminals."

"First, a cybercriminal must overcome multiple security controls, which takes time. Later, in order to maintain their distance from the crime and hide their identity, they need to hire someone else (referred to as a money mule) to transfer the stolen money to their account."

"Transferring money in this way becomes time-consuming and involves numerous parties. Each additional party adds additional risk that the criminal might be found out.”

“Stealing Bitcoins is much simpler than that. The criminal only needs to send the coins to an account on one of the trading websites, exchange the coins for USD or any other currency they desire and then transfer it to their bank account.”

“Processing the virtual currency through the trading website preserves the attacker’s anonymity”

The theft is the second hit for cryptocurrency backers this week, joining the shutdown of Bitcoin exchange MtGox.

The exchange reported “unusual activity”, halting all transactions before detailing a discovered loophole wherein thieves could trick the transferral process to send twice the specified number of Bitcoins.

The exchange’s downtime has resulted in a large drop in the value of Bitcoins, with no date given as to when it would return online.

"Bitcoin has been set up on the basis of pure caveat emptor," commented the BBC's Robert Peston on the implications of MtGox's shutdown for the future of the virtual currency.

"If its participants take any losses in their stride, and learn the lessons, it can go from strength to strength."

"If they are unable to develop any kind of governance system that provides confidence that Bitcoins are where they are supposed to be, then it will disintegrate into fringe territory for loons and wild-eyed monetary anarchists."

Image of cyber robbery courtesy of Shutterstock.co.uk

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