cryptocurrency heists

Op-Ed | Cryptocurrency Heists Could Increase in 2018

Cryptocurrency Heists Could Rise

The crypto-market capitalization has grown by over 2500%. This could mean that bitcoin and other cryptocurrency heists might increase even more in 2018. Unfortunately, whenever there’s a lot of money being made, the potential for theft usually increases.  NiceHash, a crypto mining marketplace, fell victim to a $77 million cryptocurrency heist when its security system was hacked. It has been estimated that crypto cyber theft has resulted in billions of dollars worth of losses. There’s also no comprehensive FDIC insurance on cryptocurrency, which means that financial losses incurred due to cryptocurrency heists cannot be recovered.

Hundreds of billions, if not trillions of dollars continue to be funneled out of legacy stock market trading. The folks at the top might already be investing a lot of time, money, and effort to tarnish the reputation of crypto since they stand to lose a lot more over time should bitcoin/crypto continue in its current trajectory.

According to a five-year-old article, it has been established that cyber crimes are a lot more rewarding than “regular crimes”. In addition, statistics show that the chances of getting caught are much less compared to crimes conducted “in real life”.  Since the vast majority of cryptocurrency activity is conducted via the conduits of the internet, cyber heists are a lot more appealing to criminals than traditional heists.

Can government regulations actually help bring down cryptocurrency heists? It’s quite possible that government intervention could make things worse because these “regulations” might be designed to hurt the growing crypto-market. Central banks perceive bitcoin and other cryptocurrencies as a threat to their firm control over the world’s monetary supply. So, any “regulations” that might be proposed by governments could mainly be formulated to serve the best interests of the elite.

The SEC’s Crackdown on Crypto-Heists

With Bitcoin prices shooting up to nearly $20,000, the crypto-market has become extremely lucrative and the potential for cryptocurrency heists could go up along with it. Earlier this month, the U.S. Securities and Exchange Commission (SEC) had to take quick action after spotting a huge ICO scam. The PlexCoin ICO was initiated by a company called PlexCorps. Even though there wasn’t even a legitimate whitepaper available for PlexCoin, investors were still drawn toward investing in the company’s ICO.

In a span of just a few months, the company had accumulated $15 million worth of “investments” from a large number of investors. Thousands of investors were lured in because the company promised a 13-fold profit in less than a month. This is not the only time that the SEC had to intervene. A Canadian company called First Bitcoin Capital had its shares trading suspended by the SEC primarily due to lack of credible information about its business activities. There’s a famous saying, “If it sounds too good to be true, it probably is“.

More large-scale cryptocurrency heists have mainly been orchestrated through sophisticated hacking techniques. According to an old US Department of Homeland Security, an estimated one-third of bitcoin exchanges had been hacked. Now, this estimate might be even higher. Cyber thieves tend to follow the money trail, and it would not come as a surprise if their hacking efforts are directed more and more toward the booming crypto-market.

Cryptocurrency heists and their associated problems can be fixed if bitcoin’s principle of decentralization is implemented in every aspect, including the decentralization of exchanges.  If people and organizations do this, then the chances of getting hacked are practically reduced to nothing. World governments function more like trojan horses, which simply add to the problem. So, government regulations and interventions are not the answer.

Conclusion

Chainalysis, a company that specializes in maintaining the integrity of virtual assets, has released several reports highlighting that hundreds of millions of dollars have been stolen through sophisticated cryptocurrency heists performed by hackers over the internet. There are just so many ways that hackers can attack online systems and steal money. However, if every working process in the cryptosphere is decentralized, these hacks can be greatly reduced.

Much better security measures need to be implemented. Everyone who invests in cryptocurrency, or plans to, should invest their time (not just their money) learning about best practices that will shield them from the illicit activities of cyber thieves. People should also learn to be responsible for securing their assets instead of thinking of relying on governments to help them.

A friend of mine lost a $1000 because a guy promised him great returns on “some coin” which he said would be launched in November, 2018. After my friend gave him the money, the man disappeared. There was no way to contact him or trace him. These kinds of stories have become increasingly common. Trying to ask or expecting the government to help in these cases is futile. Governments are too busy protecting their own interests. It’s basically like the “Wild, Wild, West”. Therefore, it would serve everyone well to learn to safeguard their own interests and money.