These days many people are interested in Cryptocurrencies like Bitcoin, Dogecoin, and Ethereum. Is this something worth looking into from a cybersecurity standpoint or is it all a scam? I’m going to describe what cryptocurrency is, share what I’ve found from my research on the legitimacy of cryptocurrency, what one cybersecurity reporter says about it, and my own final thoughts on the cryptocurrency market.
Bitcoin was the first cryptocurrency started in 2008, and it continues to be the most popular cryptocurrency on the market in 2021. Bitcoin as well, as all cryptocurrency, uses Blockchain to decentralize the way currency transactions are done online. Blockchain is a strong cryptographic code that makes transaction more secure by pseudo-anonymizing a user’s identity. This is the reason ransomware attackers require victims to pay ransom in cryptocurrency. If malicious cyber criminals use this to get paid, and hide all their important transactions, then it can’t be legitimate… right? Well, it’s not as simple as that. It does not mean that cryptocurrency is illegitimate but it is important to note what risks are involved.
In the Crypto world there are a diversity of cryptocurrencies. There have been many cryptocurrencies created that are promised to be the next bitcoin, with big returns and incentives, but it’s all for a swindle known as the “Crypto Pump-and-Dump” (AKA pumps). “Pump-and-Dump” is where the scammers create a cryptocurrency and make out with all the money and leave investors wondering what happened. In May of 2021, Wired magazine put out an article on the new wave of Crypto Pump-and-Dumps that explains “Crypto pumps have been on the rise for a few years now, thanks in part to the relative ease of making and marketing a new digital coin. In 2018, the Wall Street Journal identified 175 “pump” initiatives, moving over $825 million through 121 different crypto coins, most of them organized on Discord and Telegram.” Cryptocurrency is fascinatingly easy to make, and easy to sell to misinformed people looking to invest in cryptocurrency. It’s not all bad. There are still people who invest in cryptocurrency and make legitimate purchases using cryptocurrency.
Because cryptocurrency allows users to remain pseudo-anonymous, using it is far more secure than other means of online transaction processes. MSN reported many companies that now accept cryptocurrencies that include Microsoft, AT&T, Burger King (In Venezuela), KFC, Whole Foods, PayPal, Twitch, Etsy, Starbucks, Newegg, and more companies. There are people legitimately purchasing items from these organizations using cryptocurrency. So, it’s not all frauds or scams, you just have to be careful. How can we avoid falling for the Pump-an-Dumps scams that malicious actor are selling? What do the cybersecurity experts say about cryptocurrency?
On September 16th, 2021, a podcast presented by Vice called Cyber by Motherboard presented “How to Not Get Scammed in the Crypto Market,” they stated that these Pump-and-Dumps are focused on new investors into the cryptocurrency world. Motherboard senior editor Jordan Pearson states that when investing in cryptocurrency you want to stick to the larger well-known cryptocurrencies (Bitcoin, Ethereum). Pearson also mentioned that the time when cryptocurrency investors could become overnight millionaires are gone. The main people who benefit from investing into the crypto market now are those who invest millions of dollars, so when it doubles it is massive. So, if you are expecting to get into the cryptocurrency market to “make it big,” I wouldn’t count on it. To be quite honest Jordan Pearson, who has been researching and reporting on cryptocurrency for year, does not even invest in any cryptocurrency. Just something to note.
One cryptocurrency to mention named Dogecoin was made by Billy Markus and Jackson Palmer who originally made the cryptocurrency as a joke. Though it was never meant to be taken seriously, Dogecoin had at one point become a sensation. Dogecoin was originally supposed to mock the idea of cryptocurrency and show its volatility. Dogecoin has become one of the major players in the cryptocurrency market. To read more, CNBC wrote about the issues with Dogecoin and the importance of smart investing. The result of Dogecoin made Jackson Palmer himself disavows the meme-based cryptocurrency.
I personally stay away from cryptocurrency market because I don’t like the idea of it remaining online, intangible, and volatile. Even though there are legitimate uses for cryptocurrency there are also many scams in the crypto market. I won’t be investing anytime soon. It all just seems too risky for me.
Like many technologies, cryptocurrency can be used for the benefit or the detriment of societies around the world depending on how it’s used. If you want to dabble in the world of cryptocurrency, I think it can be a terrific way to make some extra money, but don’t expect to get rich doing it unless you are investing a massive amount of capital. If you are not sure about cryptocurrency but still want to invest, you are better off investing in index fund if you are looking for a way to make some money, it’s about on par with the current crypto currency market.