Ransomware Attacks Spur Biden to Action
According to Anne Neuberger, deputy national security adviser for cyber and emerging technologies, the Biden administration will be introducing a whole range of initiatives to stem growing cyber fraud. These measures were triggered by several successful hacker attacks on US infrastructure companies, which dealt a considerable blow to the US economy.
Earlier this year, in May, Colonial Pipeline – the country’s largest pipeline system which delivers gas and oil products from factories in the Gulf of Mexico to the East Coast – paid out the rough equivalent $4.5 million in an unnamed ‘untraceable’ crypto to the extortionists. Reluctant to do it at first, the company had to pay ransom to resume the supply of petroleum to five states in the region. Even though the FBI managed to recover approximately half of the money paid, this was not the last one in a chain of similar attacks that would hit the country soon.
Indeed, around two weeks later, the world’s largest meat producer JBS holdings paid $11 million in BTC to hackers to stop the disruption in its supply chains. At the beginning of July, software producer Kaseya also fell victim to a ransomware attack, which abused a system vulnerability and uploaded malicious updates to the computers of thousands of Kaseya clients. Well, you get the idea, and it’s pretty clear why the government decided it’s time to act.
The Anti-Hacker Initiatives
The brand new anti-ransomware group was assigned with a task to track and terminate ransomware-related crypto transactions. Besides that, it will take a number of defensive and offensive measures: e.g., not just informing and protecting the potential victims but also launching proactive cyber attacks on the hackers.
It remains to be seen what the recent ransomware attacks might result in regulation-wise. Many lawmakers are showing concern in regards to this matter. For one, U.S. Rep. Carolyn Maloney (D-N.Y.) warned companies against paying the ransom, concerned that this may set a precedent and the situation could become worse.
The government will also be offering rewards to those who can help identify the ransomware distributors, which can go as high as $10 million in case of state-sanctioned breaches. As the State Dept. announced, the payouts can be made in cryptocurrencies – which creates another precedent, but this time a good one.
Question time: what do you think the consequences of the recent cyber attacks will be? Is it possible that they will push regulators to ‘tighten the screws’?
At the same time, Rathi recognizes that, given the modern environment, any regulator should be innovative, assertive, and adaptive. So he says that FCA welcomes any business – given that it meets, or wishes to meet, the regulatory expectations.
Legitimate Crypto Businesses – Lost in Gray Regulatory Space
However, it’s still unclear what these expectations are – which many recognize as a hindrance for legitimate crypto businesses. For one, Marcus Swanepoel, the chief executive of Luno (the exchange with the Bitcoin ad mentioned above), said that regulator uncertainty stalls those projects who want to play by the rules.
To me, it looks like it’s high time for someone to modernize the current regulatory regime. I believe in the need for smart rules, but are the regulators trying to throw the baby out with the water once again? What are your thoughts on this matter?
And here’s another question that is bugging me: should we expect more crypto ad bans from other countries and social media in the nearest future?