Why hackers use bitcoin and why it is so difficult to trace
Twitter bitcoin hack is ‘wake-up call’ for social media orgs: Former White House CIO
Former White House Chief Information Officer under Bush 43 Theresa Payton says the recent hack of high-profile Twitter accounts with a bitcoin scam highlights the ‘wild, wild west’ of cryptocurrencies.
By now you have probably heard of bitcoin, even if you haven’t used it yourself. Launched 11 years ago, bitcoin is a digital currency that operates independently of third-party oversight from banks or governments. It allows two people anywhere in the world to exchange value across the internet in minutes.
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TWITTER BITCOIN HACK: LIST OF AFFECTED ACCOUNTS INCLUDES ELON MUSK, BILL GATES
Although it hasn’t found success as a mainstream, transactional currency, it is increasingly used in scams. On Wednesday, it was featured in a hack of prominent Twitter accounts. Purporting to be former President Obama, Bill Gates and Kanye West, hackers steered Twitter followers to send $1,000 in bitcoin, promising $2,000 in return. They drew more than $100,000 before the scam was shut down.
Here’s what you need to know about bitcoin.
Q: Is bitcoin actually money?
A: We call bitcoin digital currency or money, but really it is just a computer program. People trade bitcoin with each other directly, or buy and sell through online exchanges. At current prices, one bitcoin is worth about $9,000, but it can be divided and sold in smaller slices.
Anyone with a computer and an internet connection can download the software, which comes with something called a wallet, a place to store your bitcoin balance. That wallet has an address—a long string of numbers and letters, called the public key—that lets people find the account on the network. Anybody can send bitcoin into a wallet. Taking money out of that wallet, though, requires control of what is called the private key, another long string of letters and numbers.
HOW MUCH MONEY WAS STOLEN IN TWITTER HACKS?
Q: Why did the hackers ask for bitcoin in the first place?
A: Unlike opening up a bank account, you don’t have to provide any identifying information to start a bitcoin account. Bitcoin is effectively anonymous, and law enforcement can’t freeze your bitcoin account like they could your bank account.
“A bitcoin wallet is something you can possess and control without going through a third party,” said Yaya Fanusie, an adjunct senior fellow at the Center for a New American Security. “Bitcoin is a choice for scammers just because of that.”
The European Union Agency for Law Enforcement Cooperation says bitcoin is one of the most popular cryptocurrencies for criminal use. Meanwhile, cyber crime is rising and is expected to be more profitable than global illegal drug trade by next year, according to data provider Cybersecurity Ventures.
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