Blockchain tech suffers $1 billion cyberattacks in eight years

Cyber attacks targeted at blockchain technology rose to $1 billion in the last eight years.This was disclosed yesterday at the Nigerian Communications Commission (NCC)-organised telecoms industry risk management conference.

In his presentation on the theme, Dr Jacob Afolabi (a retired director at the Nigeria Deposit Insurance Corporation), who was the lead speaker, said based on the high security embedded in the technology, the point is not whether it’s breakable or not, but whether it can be misused.

He said this is because the blockchain itself is just a piece of data, saying it doesn’t do anything. He stressed that it’s the software and the use of the software that makes the blockchain useful.

According to him, blockchain technology refers to a system that records information in a way that makes it nearly impossible to change, hack or manipulate, adding that the term ‘blockchain’ is a database of a digital ledger for storing data and it maintains a continuously growing list of data records or transactions and allows thousands of connected computers, devices or servers to maintain a single, secured, and immutable ledger.

He said the type of distributed ledger technology that can be used across industries. According to him, telcos and Internet service providers (ISPs) can use the technology to secure their networks, manage network traffic, and reduce the amount of data they need to store.

The former NDIC chief said telcos cannot afford not to leverage the opportunities of streamlining their operations with blockchain technology. “In that instance, four use cases, namely: fraud detection, roaming and settlements, 5G enablement, loT connectivity (cut costs by removing processing overheads related to loT gateways) provide an additional layer of security as it makes businesses benefit from a robust level of encryption, demonstrate the potentials of blockchain in streamlining their operations.

“Blockchain technology opens doors to fast processing of transactions and coordination between a million devices. With the growing number of interconnected devices expected to grow, blockchain technology is the answer to support the processing of many transactions.

“Blockchain itself might be secure, but the use or abuse of the blockchain is where all the weaknesses come through.
“In total, the publicly reported losses by cyberattacks against blockchain systems during the past eight years exceed $1 billion,” he stated.

According to him, blockchain stakeholders are working on ways to prevent future instances of abusing blockchain technology: “But in the meantime, stakeholders leveraging blockchain should direct their efforts at minimizing the likelihood of being abused; and/or deciding the risk of them being abused is small enough that you’re willing to tolerate it.”

Checks by The Guardian showed that scammers targeting institutions such as hospitals, schools and government offices for ransom pocketed $1.1 billion last year, compared with $567 million in 2022.

Analytics firm Chainalysis disclosed that a group of digital extortionists named “cl0p”, which subverted a file-sharing software MOVEit, made nearly $100 million in ransom payments.

Hundreds of organisations, including government departments, UK’s telecom regulator and energy giant Shell (SHEL.L), have opened a new tab, have reported cybersecurity breaches involving the MOVEit software tool, which is typically used to transfer large amounts of often sensitive data, including pension information and social security numbers.

A report in November showed that cybercrime group “Black Basta” had extorted at least $107 million in bitcoin, with much of the laundered ransom payments making their way to the sanctioned Russian cryptocurrency exchange Garantex.

Cryptocurrency theft via cyber heists and ransomware attacks is also a significant source of funding for North Korea, according to UN reports.