In this digital age all kinds of different groups are developing technology to change the way our society handles things like money and information. This includes major institutions like governments and banks but unfortunately it also includes less savory elements of society. Criminals are some of the quickest people to adapt to the times and take advantage of new technology. For instance recent cyber threats like Ransomware seem to have been designed specifically to make use of bitcoins, a currently unregulated form of digital currency.

For those who are unfamiliar, bitcoins are a fairly popular method of online payment developed in 2009. Obviously the concept of digital money is a little hard to pin down in layman’s terms but bitcoins are opensourced and thus form an economy onto themselves. The idea is that this eliminates the need for a third party to guarantee legitimacy while still keeping things honest. Because everyone who uses bitcoins is plugged into this digital economy no one person or group has control. Whether that’s true or not is hotly debated.

Ransomware is a form of malware popular among hackers and scammers today. While in some ways this sort of thing is as old as the internet itself, Ransomeware is still a fairly new development. The first forms of Ransomware appeared in 2013, only three years ago, and caused considerable damage as law enforcement and information security companies scrambled to figure out how this new form of cyber attack worked.

This because Ransomware was designed specifically to slip past what were conventional security measures at the time and then infest the computers critical systems. The name stems from the way the virus operates. While most hacks and scams search for ways to steal valuable information like credit card numbers Ransomware literally holds the computer hostage. It enters the hard drive and takes away control from the user by sealing off critical systems. The user then receives a message demanding considerable payment in exchange for ending the lockdown.

Thankfully, Ransomware is transferred primarily through unsafe downloads and phishing links which most modern, security conscious users know how to avoid. Anti-virus programmers have responded by making more sophisticated defense systems but the cheapest and easiest way to defeat Ransomware is to simply keep back ups of your important system files.

So what is the connection between Ransomware and bitcoins? Well, bitcoins are designed specifically to operate outside traditional means of regulation which means bitcoin transactions are virtually untraceable. While this may have been meant to protect consumer privacy this feature has an obvious appeal to scammers and other cyber criminals. In fact back in 2013 when the first wave of Ransomware cases hit the messages demanded payments be made specifically in bitcoins. Many believe this new form of untraceable online currency is what made Ransomware possible, allowing identity thieves to transition into online blackmailers and extortion artists. After all most online scammers wouldn’t be so bold as to demand direct money transfers. Instead they prefer to use scams or hidden Trojans to gain access to the bank or credit card accounts of unaware victims and then make off with their money.

The presence of an entire online economy must have seemed like a gold mine to cyber criminals who quickly began developing ways to exploit this market to their own profit. The first Ransomeware program, known as Cryptolocker because of it’s method of locking critical files and systems through encryption, appeared in 2013. This is just four years after the development of bitcoins. Three years later and reported cases of Ransomwares are once again on the rise. The malware developers have moved up from harassing everyday citizens and instead have begun using the malicious software in attempts to extort money from major institutions like universities, hospitals, and even police stations.
A recent assessment suggests that in the first 3 months of 2016 Ransomware resulted in the loss of nearly $200 million just from individuals.

While it may not have been the developer’s intention, bitcoins has opened the door to a new brand of cybercrime in the form of Ransomware. As always the best way for users to defend their computers is to be vigilant and avoid suspicious email attachments, untrustworthy websites, or links. It also wouldn’t hurt to start backing up your important files if you haven’t done so already.