Bitcoin: Digital currency or criminal currency?

WannaCry cyber attack that engulfed more than 100 countries over the weekend indeed left many people crying.

The ransomware apparently based on stolen US National Security Agency’s surveillance tools affected tens of thousands of machines worldwide, that included Spanish telecommunications giant Telefónica, operations at the Russian Interior Ministry, and Britain’s National Health Services (NHS), where hospitals were disrupted and medical procedures were stalled.

Hackers have reportedly been demanding a ‘ransom’ of $300 worth of Bitcoin for restoring access to computers that got locked due to the virus. Well, this isn’t the first time that hackers have demanded ransom in virtual currency. In fact, most of the cases of cyber-theft in recent times point to the fact that Bitcoins have indeed become the new criminal currency of choice. Let’s find out why.

Bitcoin is a virtual currency invented by Australian tech entrepreneur Craig Wright under the pseudonym Satoshi Nakamoto. Based on the concept of blockchain ledger, this cryptocurrency isn’t tied to any bank or government. Without any transaction fees, users are allowed to spend money anonymously.

The coins are ‘mined’ using computers to solve complex math puzzles.

According to Coinbase, a company that helps users exchange bitcoins, one bitcoin recently traded for $1,734.65, which is more than the value of an ounce of gold, which trades at less than $1,230.

Why hackers love Bitcoin?

The above description makes it pretty clear why this digital currency is a favourite with criminals. While each bitcoin transaction is recorded in a public log, it’s all under user’s wallet ID. The identity of the user is never disclosed (What else can hackers ask for?)

Also, one can easily buy or sell anything online without getting traced, something that happens in the case of drugs and other illegal activities.

The way forward

Like any technology, Bitcoin too has a flip side. According to experts, its positives far outweigh the currency’s link to the dark web. The virtual currency surely has the potential to transform industries but perhaps the time has come for governments and regulators to work on the credibility factor of this technology which will help to make it more efficient, trusted and transparent.