Ransomware's Effect On Crypto Markets

Alice Ingrid
March 21, 2024

BitMEX was hit with a $55 million sale of Bitcoin (BTC) that quickly dropped to $8,900 but soon stabilized.

Inputs that matter: Ransomware is usually paid in Bitcoin (BTC) or other cryptocurrencies, giving those behind the scam large amounts to unload at any time, potentially creating havoc in the market.

  • The Securities and Exchange Commission (SEC) has asked Congress for an additional $158 million to regulate crypto markets in the US.
  • BitMEX and other exchanges are looking at ways to protect investors from large order transactions.

The opportunity: According to BitMEX, "An unknown entity sold over 400 bitcoin in a short period of time on the BitMEX BTC/USD spot market."

  • Within two minutes of the sale, prices fell to $8,900.
  • CoinDesk said, "Prices on other exchanges held well above $60,000."
  • Less than 10 minutes later, the price rebounded to $67,000.

Zoom in: Reuters reports that ransomware attacks reached $1 billion in 2023.

  • The US Department of Homeland Security details that cryptocurrency, typically Bitcoin, has become a universal ransom payment.
  • The UK National Cyber Security Centre (NCSC) warns that AI will escalate the ransomware threat globally.

Between the lines: According to BleepingComputer, over 100 malicious AI models on the Hugging Face platform provide attackers with backdoors.

  • This makes it easier for less sophisticated groups to profit from ransom attacks.
  • Presumably increasing the number of new attacks to occur in 2024.

Follow the money: Insurance broker Marsh details, "Law enforcement, private sector companies, and service providers have teamed up to develop approaches to trace bitcoin transactions."

  • Regardless, the impact of bad actors with large sums of crypto poses a risk to the stability of crypto markets.

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Read More

  1. https://www.tradingview.com/symbols/BTCUSD/
  2. https://crypto.news/sec-wild-west-crypto-markets/
  3. https://www.thestreet.com/crypto/markets/bitcoin-price-crashes-to-8900-following-55-million-orders
  4. https://www.coindesk.com/markets/2024/03/19/bitcoin-flash-crashed-to-89k-on-bitmex/
  5. https://www.reuters.com/technology/cybersecurity/crypto-ransom-attack-payments-hit-record-1-billion-2023-chainalysis-2024-02-07/
  6. https://www.hsgac.senate.gov/library/files/hsgac-majority-cryptocurrency-ransomware-report_executive-summary/