Cyber-criminals Getting Leary Of Bitcoin, Adopting Monero

January 10, 2018  |  By Stone Tillotson

Cyber-criminals are starting to switch from bitcoin (the “coin of the realm”) to alternative e-coins like Monero more and more every day. As awareness and buy-in grow, bitcoin transactions increasingly have drawn the focus of criminal investigators and regulatory bodies. Bitcoin’s lack of privacy features and its distributed ledger mean the buyer, seller, and amount of each transaction is essentially public information, waiting only to be linked to a real name and address. A one-time breach in a bitcoin wallet holder’s anonymity is effectively equivalent to publishing one’s real world banking records for all time. Monero incorporates privacy features by design, so tracing transactions through its distributed ledger is much more difficult. Monero achieves this by encrypting the essential elements of a transaction buyer, seller, and wallet — leaving little to demonstrate even the existence of a transfer of funds between identifiable parties. The cyber-criminal crowd has taken note and this has led to more ransomware demanding payments in monero — a trend that likely will accelerate with time.

IISP Analyst Stone Tillotson: "Monero boasts another claim to its growing adoption, aside from privacy: it doesn’t look like it’s riding on a massive, scary bubble. Bitcoin’s stratospheric rise and huge swings in price make it an unattractive choice for transactions of all kinds, including cyber-crime. Cyber-criminals, after all, are in business and they love steady paydays as much as anyone. It’s simply bad for business when sudden swings in bitcoin value make your illicit wares unaffordable or your ransomware demands unpayable. And, that doesn’t even speak to the threat of having your gains destroyed when the bubble bursts. So, while Monero’s technical improvements certainly qualify it as a possible (maybe even desirable) successor to bitcoin, Monero’s growing adoption likely owes as much to being a crypto-bubble straggler as anything else. Since Monero’s value hasn’t yet gone sky high, this provides some reassurance that it’s closer to its real floor exchange rate, which limits possible losses. It’s lower value also provides plenty of running room to see it appreciate against non-cyber currencies while the crypto-bubble lasts. None of this is meant to discount the impressive technical achievements of bitcoin, nor any of the other new crypto-currencies in their rise, but rather to highlight how economic considerations are driving the trends. Crypto-currencies may be cool, but ultimately it’s the utility and usefulness that have the final say in value."

 

For further reading

 

More by the author(s)