08 February 2016

Researchers find more than 100 malware families targeting bitcoin

27 February 2014  |  6096 views  |  1 Computer virus

The rise of bitcoin over the last year has piqued the interest of cybercrooks, who have created more than 100 unique families of malware designed to steal virtual currencies, according to Dell SecureWorks.

The crypto-currency community is currently reeling from news that troubled exchange MT. Gox appears to have lost nearly 750,000 bitcoins - worth hundreds of millions of dollars - to malleability-related theft.

While the MT-Gox case may be unusual for its scale, research from Dell SecureWorks suggests that theft is rife as crooks look to cash in on the skyrocketing value of bitoin and other currencies.

The research shows that the number of Windows-compatible cryptocurrency-stealing malware (CCSM) families has broadly tracked bitcoin's value, shooting up over the last six months.

The most common type of CCSM is the wallet stealer, which searches for well-known wallet software key storage locations, either by checking known file locations or by searching all hard drives for matching filenames. Typically, the file is uploaded to a remote FTP, HTTP, or SMTP server where the thief can extract the keys and steal the coins by signing a transaction, transferring the coins to their address.

Many wallet-stealer families also steal credentials for Web-based wallets, such as Bitcoin exchanges. Although several exchanges have implemented two-factor authentication using one-time PINs to combat unauthorised account logins, advanced malware can bypass this by intercepting the OTP as it is used and creating a second hidden browser window to log the thief into the account from the victim's computer.

The researchers also warn that once malware is installed on a computer there is a good chance it will fail to be spotted, with an average unweighted detection rate across major antivirus providers of a little under 50%.

With two-factor authentication and antivirus software largely ineffective at protecting virtual currency holders, Dell SecureWorks suggests using alternative wallets such as Armory and Electrum, which can protect against theft-by-malware by using a tricky split arrangement for key storage.

Splitting involves one computer, disconnected from any network, running a copy of the software and holding the private key that can sign transactions, while a second PC connected to the Internet holds only a master public key of which addresses belong to the offline wallet.

This computer can generate transactions, but it cannot sign them because it does not have the private key. A user wishing to transfer coins generates an unsigned transaction on the online computer, carries the transaction to the offline computer, signs the transaction, and then carries it to the online computer to broadcast the transaction to the Bitcoin network.

Comments: (1)

Bo Harald - ZEF and Real Time Economy Program - Helsinki region | 27 February, 2014, 21:05

High price to pay for some convenience. Reasons for traditional service providers to move to more real time services - and rightly demand KYC and equal regulatory playfield.

Regulators - step in! Or do we have to wait for really big disasters?

Be the first to give this comment the thumbs up 0 thumb ups! (Log in to thumb up)
Comment on this story (membership required)
Log in to receive notifications when someone posts a comment

Finextra news in your inbox

For Finextra's free daily newsletter, breaking news flashes and weekly jobs board, sign up now.

Related blogs

Create a blog about this story (membership required)

Related stories

25 February, 2014
24 February, 2014
14 February, 2014
10 February, 2014
07 February, 2014
25 November, 2013
22 November, 2013
18 November, 2013
08 April, 2013

Top topics

Most viewed Most shared
Fintech rising: Resistance is futile, says...
10811 views comments | 48 tweets | 41 linkedin
Digital transformation driving earnings at...
9122 views comments | 43 tweets | 36 linkedin
ECB eyes up European P2P payments
7734 views comments | 28 tweets | 38 linkedin
Visa opens up to developers
7473 views comments | 23 tweets | 40 linkedin
It may take ten years, but blockchain tech...
6324 views comments | 20 tweets | 19 linkedin

Featured job

£100,000 basic, £180,000 OTE + Benefits

Find your next job