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Ransomware, a malware that targets crypto users especially Bitcoin users have been since 2012. Its incidence, however, rose sporadically in the last seven years, as there were 181.5 million ransomware attacks recorded in the first half of 2018 alone.
Mid-year 2019, the figures recorded shot up significantly by a 363 percent increase when compared year by year. Analysts are drawing up the premise that the increase in the number of incidents of the malware attack could be responsible for the volatility of Bitcoin prices.
Ransom Ware’s Operation Tactics
The malware attack is usually carried out using a trojan that comes in the form of legit files. It encrypts the user’s files and then threatens to publish the victim’s information unless a ransom is paid. All the while blocking access to the user’s data until the ransom is paid. The ransom payment demanded is a cryptocurrency, most especially Bitcoin.
Both private and public sectors like schools, hospitals, and state departments have reportedly fallen victim to this malware attack. An example is a Wannacry attack in the year 2017 which reportedly infected 300,000 computers even without user interaction. Ryuk, a malware that affects logistics and tech companies was of prevalence in the year 2019 as it obtained higher ransom demands.
The Link Between Bitcoin Prices and Ransomware
Recent research carried out in the first quarter of the year 2019 reveals that there was an 89 percent increase in the average ransom demanded, totaling over $12 million. It also revealed that most of the ransom payments, over 98 percent accounted is Bitcoin. The remaining 2 percent payment methods are coins like Monero and Dash which are privacy-protecting. It was also deduced that the extortion could have possibly led to an increase in Bitcoin demand and necessarily its price.
It has been proven that a Bitcoin price increase occurred concurrently with the Wannacry worm attack in the year 2017.
A top cybersecurity outfit, however, corroborated the fact that there seems to be a link between high profile ransomware attacks like that of Wannacry and Bitcoin prices.
Other Premises Are Drawn
A cybersecurity professor took the debate to higher grounds by insinuating that Bitcoin hoarding may be responsible for the said price increase rather than the ransom demands itself. In a scenario where a company preempts a ransomware attack, it buys Bitcoin to keep to forestall such events thereby resulting in a price hike.
In the spate of increased incidence of high profile ransomware attacks, More companies, especially in the US, end up buying Bitcoin for keeps and this invariably affects its market prices.