Despite sounding as though it’s been lifted directly from a science fiction novel, cryptocurrency is entirely real. The term is used to describe a range of digital currencies that can be used to purchase goods and services over the internet, and has recently found mainstream popularity through the rise of bitcoin – undoubtedly the most well-known of cryptocurrencies.
Bitcoin quickly became a phenomenon when its value started to skyrocket a few years back, and people realised they could make serious money from investing in it. From January 2017 to December the same year, the price of bitcoin rose over 2000%, from $953 to $20,089.
However, as the value of bitcoin continues to fluctuate and more opportunists look to make a quick buck, the potential for serious cryptocurrency fraud grows in parallel. Because of the encryption techniques used behind the likes of bitcoin and others, cryptocurrency is notoriously hard to track down and can be moved from A to B anonymously. While this can bring security benefits to the parties sending and receiving the money, it also means that if this money is ever stolen by threat actors, it can be basically impossible to tell who’s taken it and where it’s gone.
This has made cryptocurrency a prime target for phishers. Stealing the likes of bitcoin through traditional hacking methods might be an incredibly difficult task, but if phishers can use social engineering tactics to fool people into handing over access to their digital wallet – the locations in which individuals store their cryptocurrency - it’s never been easier to steal money.
Two further risks relating to cryptocurrency lie in the volatility of its value and the fact it’s unregulated. With prices changing almost in real-time, someone who might have once just bought one or two bitcoin for a measly sum might end up having a lot more cash in their digital wallets than they ever thought they would. This leaves huge amounts of money out there that’s just waiting to be pounced upon by phishers, and once individuals or companies realise their cash has been stolen, there’s next to nothing they can do about it.
The scale of cryptocurrency scams is staggering. According to an article on Bitcoin News, they are responsible for a loss of $9 million every single day, and that number is sure to rise as the popularity of cryptocurrency continues to rise.
For brands, protecting themselves and their customers against cryptocurrency scams can be a real challenge, especially when most of the activity takes place without people even realising it. What can help, however, is treating cryptocurrency and digital wallets with the same level of care that you would your bank cards and online log-in details. While each form of cryptocurrency comes with its own value and level of security, they all hold legitimate monetary value, and so comprehensive security is required to ensure it is not compromised by nefarious individuals.
Cryptocurrency is not going to go away any time soon, and it holds huge amounts of potential for brands moving forwards. But there’s still a long way to go before it’s used safely and securely.