From regulatory authorities cracking down on blockchain powered cryptocurrencies to both individual and state-sponsored hackers draining crypto-wallets, cryptocurrency Ponzi schemes and the power tussle of who would be in the forefront of blockchain technology.
The United States as always is in leading blockchain technology adoption but many other countries including China, Japan, Russia, South Korean, Turkey, Venezuela and even Malaysia are developing different strategies to cope with the blockchain’s innovations and the cyber war that comes with it.
Just few weeks ago according to Cryptovest.com Vladimir Putin of Russia said that anyone who is “late in this race” will “be under full dependence” to other nations and leaders who have been early adopters. “Russia cannot allow this,” referring to Blockchain technology.
Sberbank, a Russian state-owned lender has launched a dedicated blockchain lab in Russia to conduct research and drive blockchain implementation and promotion. Few weeks ago Russia also launched its first blockchain school for training students on the technical aspect of blockchain technology.
According to a Waves survey Japan is expected to be the leader of cryptocurrency adoption in 2018 with 27% while Russia and South Korea both came second with 15% and US and China at 3rd and 4th with 14% and 13% respectively.
As some countries are adopting cryptocurrency to drive innovation, Malaysia is sending police officers to school to enhance their skills to be able to meet up with the increasing rate of cybercrimes and digital currency scams and frauds.
A joint study by the Center for Strategic and International Studies (CSIS) and McAfee in Feb 2018 on the Economic Impact of Cybercrime – No Slowing Down reveals that Cryptocurrencies is becoming a safe haven for criminals to launder money.
“Monetization of stolen data, which has always been a problem for cybercriminals, seems to have become less difficult because of improvements in cybercrime black markets and the use of digital currencies” …… “Digital currency makes ransomware payments easier and less traceable. The increased ease of monetization is another reason why cybercrime has increased”
According to the study: “Bitcoin users can only be identified if their accounts become linked to their real identity, something most criminals are careful to avoid. However, linking an account with identifying information is a necessary component of converting Bitcoin into real-world currencies through banks or exchanges, creating a vulnerability for criminals. To address this, a number of services have been established in recent years that allow cybercriminals to launder their Bitcoins and withdraw them through unregulated exchanges to avoid being caught. Bitcoin laundering can occur through the process of “tumbling,” or “mixing,” where multiple users pool both clean and dirty Bitcoins together, letting a program execute a series of exchanges between the members that eventually gives the users back their money in randomized coins”.
At the same time, some countries like North Korea are exploiting the ugly side of blockchain-powered cryptocurrency to sustains its economy, turning its hacking operations to the more lucrative moneymaking machine.
“Digital currencies, including Bitcoin, which are stolen by Pyongyang’s cyber warfare, are easily traded and laundered and ultimately funneled back into North Korea to sustain the impoverished nation’s economy”.
The anonymity of Bitcoin and other cryptocurrencies makes it easier to circumvent regulations and the international community as you could not detect the actual identity of the fund owner.
Countries like Venezuela are launching crypto coins “Petro” to counter US-backed sanctions amid deteriorating political and economic conditions in the Latin American country. According to the country’s President, Nicolás Maduro:
“The Petro is born and we are going to have a total success for the welfare of Venezuela.”
“The Stone Age has not ended due to lack of stones, but because new technologies have appeared.” ~ Vladimir Putin
The new cyber warfare has just begun
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