E Security Feb 9 Japanese Blockchain technology can make transactions more secure, but cryptocurrency transactions based on this technology have been hacked because they do not take place on a secure network. The spike in cryptocurrency prices has drawn the attention of hackers, with cryptocurrency thefts occurring frequently, and tracking "blockchain" transactions is not the same as tracking traders, making it exceptionally difficult to combat cybercrime.

Cryptocurrency price spike draws attention of hackers

In late January 2018, the Coincheck exchange in Tokyo, Japan lost 58 billion yen (roughly Rs. 3.357 billion) worth of cryptocurrency due to a hacking attack. The Coincheck exchange has halted trading in the stolen cryptocurrency NEM (Japan's indigenous cryptocurrency) and is tightly controlling trading in other cryptocurrencies. This is the second major attack on Japanese cryptocurrency exchanges after the Mt Gox collapse in 2014.

The attack on Coincheck, while not affecting its bitcoin numbers, was the biggest in Japan since the Mt Gox crash. Mt Gox, once the world's largest bitcoin exchange, had lost hundreds of bitcoins in a hack. Coincheck apologized for this and promised to compensate customers for the loss of their NEM coins, and pledged to investigate the cause of the loss of NEM coins and improve security to avoid a recurrence of the incident, as required by the Japanese Financial Services Agency.

The reason for the loss of NEM coins and who is behind it is not known. The Mt Gox case had turned off many Japanese investors from bitcoin and prompted authorities to create more rules. Chainalysis estimates that Mt Gox's missing bitcoins were worth $7.5 million (roughly Rs. 47.14 million) based on the market value at the time, but nearly $10 billion (roughly Rs. 62.9 billion) based on the market value in January 2018.

Bitcoin theft, including that stolen through scams, ransomware and more, rose at least 30 times from $3 million (about R18.86 million) in 2013 to $95 million (about R197 million) in 2016, according to cryptocurrency research firm Chainalysis.

It was only after soaring to nearly $20,000 in December 2017 that the price of bitcoin fell back slightly, and suffered even more of a precipitous drop in late January and early February 2018, with all other mainstream digital currencies showing varying degrees of decline as the price of bitcoin plummeted. All of the world's top 10 virtual currencies fell last week, with declines of greater than 20% in general. On February 6, 2018, the price of bitcoin fell below 1 bitcoin = $6,000 at around 12:00 p.m. BST, with a one-day drop of more than 25% at one point, according to the bitcoin price statistics website INVESTING quotes. However, later that day, the bitcoin price recovered slightly to the $1 bitcoin = $7,000 mark.

What are the security concerns for cryptocurrencies?

What is a blockchain? A blockchain is a digital blockchain containing records of transactions, each interconnected with each other, making it difficult to tamper with an individual block unless a hacker can modify the records of a block at the same time and not be detected by the other blocks. Records on a particular individual blockchain are secured by cryptography, and those involved in the transaction use private keys assigned to them, which act like personal digital signatures, and any modification causes the signature to fail and warns other keys in the network to make changes. The blockchain is placed in an "end-to-end (P2P)" network, where all blocks are constantly updated in parallel. Accessing a particular blockchain and making simultaneous changes to all connected blocks requires significant computing resources.

Poor security

Anti-virus software company Hauri Inc. Director General Simon Choi says that while the blockchain is relatively secure, exchanges play a vital role in facilitating crypto than trading, and they have made the likes of bitcoin the mainstream cryptocurrency. For example, South Korean exchanges have been repeatedly exposed to security risks, and the South Korean government has said that exchanges that lack security measures will face fines.

Identifying hackers is very difficult

Choi said it is possible to track blockchain transactions, but not to identify the cryptocurrency holders. That's where the biggest hole is. Even if cryptocurrencies go into the pockets of hackers, if you don't know exactly which hackers, you can't bring them to justice. The constant attacks have prompted the cryptocurrency community to seek various ways to stop the criminals.

The South Korean government is working to deploy a system to track cryptocurrency transactions that connects cryptocurrency accounts to existing bank accounts that have been vetted by financial institutions. nevertheless If hackers put cryptocurrencies to trade on exchanges outside of South Korea, that measure would still not identify the user of the transaction The Government's policy is to take away the meaning of the word, and then it loses its meaning again.

Note: This article was compiled and reported by E Security, please specify the original address

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