Thursday, June 24

Whether you think Bitcoins are the currency of the future or possibly a passing gimmick, you cannot deny that some folks already have made millions. So with the attraction of “easy” money comes crime. Plus the crime is getting bigger and a lot more sophisticated.

At the beginning it was the petty crime. People will offer to sell something for Bitcoins and not pay. Or even offer to sell Bitcoins and never deliver. You get this in just about every online marketplace. It erodes the trust in the program and is typical. Most internet savvy folks know how you can avoid probably the worst of it. Since Bitcoins is still confined mostly to techies, it’s been less of a problem. Sites quickly sprang up that listed trusted sites, buyers, and sellers and also those not to do business with. The system was self policing in order that is short.

Now that the stakes have been raised, we’ve a higher level threat to the Bitcoins system. Trojans and viruses have been created to target the Bitcoins wallet. The Bitcoins wallet is presently stored in a common directory and is un encrypted. So anyone with access to your laptop can “take” your Bitcoins in a matter of seconds. The virus looks for that directory and sends off the information to the criminal. For the virus to get into your computer, you will have had to invite it. It was connected to a system which claimed to be valuable to Bitcoins mining. People downloaded it to see if it helped and were infected. Ordinarily this is a thing that very few of us would willing do. But in the Bitcoins world, everyone was striving for an advantage. Time was compressed as people jumped at every occasion in this “gold rush” type of atmosphere.

In early June a person lost $500,000 worth of Bitcoins to this technique. Someone had downloaded a few things and was not sure how or when the trojan was installed. He found several malware items when he ran a virus check. The trojan was a lot more then likely invited into his computer and seeing as how Bitcoins are really new a virus program would be not likely to need to protect the Bitcoins wallet. The transaction was noticed on the Bitcoins network and also a unidentified person posted about their successful crime on Twitter. People have called for the Bitcoins community to band together and reverse the transaction. The feeling is this would create a dangerous precedent as what other transaction could then be reversed. Who proves that a serious offense was committed? As of the writing of this, the money hasn’t been recovered.

Once again Bitcoins and Bitcoins users are learning to adapt. cryptocurrency mining hardware of the Bitcoins software is going to encrypt the wallet behind a password. Again, individuals are identifying which software’s and applications are safe and which ones are not. The system is self correcting again. Big investment and the latest press for Bitcoins is going to bring the unsavory side of commerce to Bitcoins over and over but with all the computing power and technological know precisely how that’s in the current Bitcoins community, I doubt that adaptation will be very far behind.

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