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What's The Deal With Bitcoin?

Published: 2011-06-17
Last Updated: 2011-06-23 20:16:24 UTC
by Lenny Zeltser (Version: 1)
2 comment(s)

This week brought a number of headlines related to Bitcoin--a peer-to-peer online currency that seems to be increasing in popularity. From the security perspective, the rise of Bitcoin offers a peek at the type of financial transactions that may need to be safeguarded in the future and also provides insight into the criminal activities associated with such transactions.

Malware has appeared to steal Bitcoin wallets, time is near where botnets will be used for Bitcoin mining and attackers are probably considering whether weaknesses in the Bitcoin design and implementation might be used to game the Bitcoin market. Just like Friendster was the precursor to today's on-line social networks and Napster foreshadowed modern online music distribution models, so too BitCoins might be a sign of upcoming approaches to distributed online financial transactions.

Here are a few articles for coming up to speed on Bitcoin and the recent incidents associated with it.

Getting Started With Bitcoin

Bitcoin Mining

  • Understand the notion of Bitcoin mining--generating new Bitcoins by solving cryptographic problems. Consider the likely scenario of compromised computers being used for Bitcoin mining--a malicious practice that is not yet widespread, yet will inevitably rise in popularity.
  • Consider the Bitcoin mining tool written in JavaScript. It solves cryptographic problems to generate new Bitcoins while running in the browser of visitors to the miner's website. Could this approach provide a new way for legitimate websites to generate revenue without displaying traditional ads? Might such code running inside malicious Flash ads provide a new revenue stream for online attackers?

Recent Bitcoin Incidents

Potential Bitcoin Implications

The notion of Bitcoin as a distributed and anonymous form of currency is capturing the world's attention. The readers of this blog will find it particularly interesting to consider the implications of the role that such currency can play in the criminal marketplace and online attack activities.

Perhaps Bitcoin might be ahead of its time and maybe its design and implementation is flawed--we will know soon enough. Regardless, it is an idea that will inspire creative thinking in the space of online payments. In the words of Edward Z. Yang, "The future of Bitcoin depends on those who will design its successor. If you are investing substantially in Bitcoin, you should at the very least be thinking about who has the keys to the next kingdom."

(This diary is based on the text originally published on my blog.)

-- Lenny Zeltser

Lenny Zeltser leads a security consulting team and teaches how to analyze and combat malware. He is active on Twitter and writes a daily security blog.

 

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