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Greek Banks Under Cyberattack, Face Ransom Demands ( 23

An anonymous reader writes: Hackers have targeted three Greek banks for a third time in five days, demanding a ransom from each lender of 20,000 bitcoin (€7m), according to Greek police and the country's central bank. A group calling itself the Armada Collective demanded the bitcoin ransom after staging its first attacks last Thursday, and then threatened a full collapse of the unnamed banks' websites if they refused to pay up. These initial attacks took the form of a distributed denial of service — flooding the banks' websites with requests so that they crashed under the strain. On Thursday, they succeeded in disrupting electronic transactions at all three banks for a short period, but customer information was protected, a police official said.

Patreon Users Threatened By Ashley Madison Scammers ( 76

itwbennett writes: "Over the last few days, the group responsible for extortion attempts and death threats against Ashley Madison users has turned to a new set of targets – Patreon users," writes CSO's Steve Ragan. A message sent from the same account used in previous campaigns by the scammers demands a payment of 1 BTC or else the Patreon user will have their personal information exposed. "The [Bitcoin] wallet being used by the group has barely collected anything," says Ragan, "suggesting that after their massive push towards Ashley Madison users, people have stopped falling for their scams."

Coinbase Issues Bitcoin-Based Debit Card ( 52

An anonymous reader writes: Coinbase, one of the largest bitcoin exchanges, introduced a "Shift Card" today, which is a Visa debit card that allows users to spend bitcoin wherever Visa is accepted within 24 U.S. states (other states are blocked by regulations for now). The card acts as a currency exchanger, debiting your Coinbase-controlled bitcoin wallet for an appropriate amount of bitcoins, based on market rates, while sending U.S. dollars to the merchant at the other end of the transaction. It represents a very simple way for bitcoin holders to spend it on real-world goods. That said, it'll be interesting to see how much adoption there is. If you prefer to keep full control of your bitcoin wallet, or prefer to keep your name from being attached to it, then the card probably won't work for you. It seems likely that most people who actually own bitcoins would fall into one or both of those categories.

EU Set To Crack Down On Bitcoin and Anonymous Payments After Paris Attack ( 275

An anonymous reader writes: Home affairs ministers from the European Union are set to gather in Brussels for crisis talks in the wake of the Paris attacks, and a crackdown on Bitcoin, pre-paid credit card and other forms of 'anonymous' online payments are on the agenda. From the article: "According to draft conclusions of the meeting, European interior and justice ministers will urge the European Commission (the EU executive arm) to propose measures to strengthen the controls of non-banking payment methods. These include electronic/anonymous payments, virtual currencies and the transfers of gold and precious metals by pre-paid cards."

New Ransomware Business Cashing In On CryptoLocker's Name ( 62

itwbennett writes: A new service launched this week on a standalone Darknet website offering ransomware called CryptoLocker Service to anyone willing to pay a small fee and 10% of the collected ransom. The new venture is being run by a person using the handle Fakben, who was a former user of the Evolution (Evo) marketplace, writes CSO Online's Steve Ragan. Customers pay $50 to get the basic Ransomware payload. Once the victim pays the demanded ransom, the payment address will forward the funds – less a ten percent fee – to the Bitcoin wallet designated by the CryptoLocker Service customer. The ransom fee itself can be determined by the customer, but the recommended fee is $200. 'I prefer to be less expensive, more downloads and more infections,' Fakben said during a brief chat with Ragan.

Bitcoin Inventor Satoshi Nakamoto Nominated For Nobel Prize 153 writes: Nobel Prizes are given for making important — preferably fundamental — breakthroughs in the realm of ideas. That's just what Satoshi Nakamoto has done, according to Bhagwan Chowdhry, a professor of finance at UCLA. Chowdhry has nominated Satoshi Nakamoto, the creator of Bitcoin, for a Nobel prize in economics. The Prize Committee for the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel, popularly known as the Nobel Prize in Economic Sciences, has invited Chowdhry to nominate someone for the 2016 Prize. He started thinking about whose ideas are likely to have a disruptive influence in the twenty first century: "The invention of bitcoin — a digital currency — is nothing short of revolutionary," says Chowdhry. "It offers many advantages over both physical and paper currencies. It is secure, relying on almost unbreakable cryptographic code, can be divided into millions of smaller sub-units, and can be transferred securely and nearly instantaneously from one person to any other person in the world with access to internet bypassing governments, central banks and financial intermediaries." Satoshi Nakamoto's Bitcoin Protocol has also spawned exciting innovations in the FinTech space by showing how financial contracts — not just currencies — can be digitized, securely verified and stored, and transferred instantaneously from one party to another.

There's only one problem. Who is Satoshi Nakamoto? Suppose the Nobel Committee is convinced that Satoshi Nakamoto deserves the Prize. Now the problem it will face is how to contact him to announce that he has won the Prize. According to Chowdhry, Nakamoto can be informed by contacting him online just the same way people have communicated with him in the past. He has anonymously communicated with the computer science and cryptography community. If he accepts the award, he can verifiably communicate his acceptance. Finally, there is the issue of the Prize money. Nakamoto is already in possession of several hundred million U.S. dollars worth of bitcoins so the additional prize money may not mean much to him. "Only if he wants, the committee could also transfer the prize money to my bitcoin address, 165sAHBpLHujHbHx2zSjC898oXEz25Awtj," concludes Chowdhry. "Mr Nakamoto and I will settle later."

Ransomware Found Targeting Linux Servers, MySQL, Git, Other Development Files ( 93

An anonymous reader writes: A new piece of ransomware has been discovered that targets Linux servers, looking to encrypt only files that are related to Web hosting, Web servers, MySQL, Subversion, Git, and other technologies used in Web development and HTTP servers. Weirdly, despite targeting business environments, the ransomware only asks for 1 Bitcoin, a fairly low amount compared to other ransomware.
United States

US Law Can't Keep Up With Technology -- and Why That's a Good Thing ( 187 writes: In the 1910s, the number of cars in the US exploded from 200,000 to 2.5 million. The newfangled machines scared horses and ran over pedestrians, but by the time government could pass the very first traffic law, it was too late to stop them. Now Kevin Matley writes in Newsweek that thanks to political gridlock in the US, lawmakers respond to innovations with all the speed of continental drift. New technologies spread almost instantly and take hold with almost no legal oversight. According to Matley, this is terrific for tech startups, especially those aimed at demolishing creaky old norms—like taxis, or flight paths over crowded airspace, or money. "Drone aircraft are suddenly filling the sky, and a whole multibillion-dollar industry of drone making and drone services has taken hold," says Matley. "If the FAA had been either farsighted or fast moving, at the first sign of drones it might've outlawed them or confined them to someplace like Oklahoma where they can't get in the way of anything too important. But now the FAA is forced to accommodate drones, not the other way around." Bitcoin is another example of a technology that's too late to stop. "But have you heard the word bitcoin uttered once in any of the presidential debates? Government doesn't even understand bitcoin, and that's been really good for it." Uber and Airbnb show how to execute this outrun-the-government strategy. By the time cities understood what those companies were doing, it was too late to block or seriously limit them.

Immersion Cooling Drives Server Power Densities To Insane New Heights ( 80

1sockchuck writes: By immersing IT equipment in liquid coolant, a new data center is reaching extreme power densities of 250 kW per enclosure. At 40 megawatts, the data center is also taking immersion cooling to an entirely new scale, building on a much smaller proof-of-concept from a Hong Kong skyscraper. The facility is being built by Bitcoin specialist BitFury and reflects how the harsh economics of industrial mining have prompted cryptocurrency firms to focus on data center design to cut costs and boost power. But this type of radical energy efficiency may soon be key to America's effort to build an exascale computer and the increasingly extreme data-crunching requirements for cloud and analytics.

W3C Sets Up Web Payments Standards Group To Improve Check-Out Security 30

campuscodi writes to note that the World Wide Web Consortium has launched a Working Group to help streamline the online "check-out" process and make payment by internet easier and more secure. The proposed standards will support a wide array of existing and future payment methods, including debit, credit, mobile payment systems, escrow, and Bitcoin and other distributed ledger technologies. The group estimates that the new payments API will reach browsers by the end of 2017. For more details, you can consult the Web Payments Working Group Charter, and the group's wiki FAQ page.
The Internet

Researchers Warn Computer Clocks Can Be Easily Scrambled Via NTP Flaws ( 132

alphadogg writes: Researchers at Boston University said this week that they've found flaws in the Network Time Protocol (NTP), a 30-year-old Internet protocol whose security shortcomings could undermine encrypted communications and even jam up bitcoin transactions. The importance of NTP was highlighted in a 2012 incident in which two servers run by the U.S. Navy rolled back their clocks 12 years, deciding it was the year 2000. Computers that checked in with the Navy's servers and adjusted their clocks accordingly had a variety of problems with their phones systems, routers and authentication systems. There is at least one alternative out there, and reason to use it.

EU Rules Bitcoin Is a Currency, Exchanges Are VAT-Exempt ( 75

An anonymous reader writes with this snippet from The Stack: The European Union's Court of Justice (ECJ) has today ruled that Bitcoin is a currency, detailing exchanges that transfer traditional currencies into the crypto-coins for a fee are to be exempt from consumption taxes. Under the EU rule against value added taxes (VAT) on transfers of "currency, bank notes and coins used as legal tender," the new call presents an important boost for Bitcoin, erasing related costs for buying and using the virtual funds in Europe – one of the world's leading trading zones. That decision overrides other approaches previously taken by some of the member countries, which treated Bitcoin like an exchangeble commodity itself, rather than a medium of exchange.

Man Behind Week-Long Bitcoin Attacks Reveals Himself 71

An anonymous reader writes: A Russian man that calls himself "Alister Maclin" has been disrupting the Bitcoin network for over a week, creating duplicate transactions, and annoying users. According to Bitcoin experts, the attack was not dangerous and is the equivalent of "spam" on the Bitcoin blockchain servers, known in the industry as a "malleability attack," creating duplicate transactions, but not affecting Bitcoin funds. Maclin recently gave an interview to Vice.

Chinese Researchers Propose Tor-Inspired Overhaul of Bitcoin 46

Patrick O'Neill writes: Although Bitcoin was never designed to be anonymous, many of its users have used it as if it were. Now, two prominent Chinese researchers are proposing a system that encrypts all new Bitcoin transactions layer by layer to beat network analysis that can unmask Bitcoin users. The new research is inspired by the Tor anonymity network. The researchers' paper is at arXiv. (Also covered by The Stack.)

Bitcoin Ponzi Scheme Operator Pleads Guilty To $150M Fraud 114

JustAnotherOldGuy writes: Bitcoin Savings & Trust founder Trendon Shavers pleaded guilty to fraud over his company's Ponzi scheme, whose victims believed they would earn one percent interest every three days — an annual rate of 3,641 percent. Shavers used new depositors' money to pay the existing depositors, and skimmed enough cream to pay for a car, a $1000 Vegas steak dinner, and plenty of casino gambling. He cost his depositors about $150M and was holding onto $40.7M in Bitcoin when he was arrested. At his peak, he controlled about 7 percent of all Bitcoins in circulation. He netted $164,758 from the scheme. Under a plea deal, Shavers has agreed not to appeal any sentence at or below 41 months in prison. Sentencing before U.S. District Judge Lewis Kaplan is scheduled for Feb. 3. Shavers, who went by "pirateat40" online, was arrested in November, two months after a federal judge in Texas ordered him to pay $40.7 million in a related U.S. Securities and Exchange Commission civil lawsuit.
The Internet

The Economics of Drug Sales On the Dark Web 53 writes: Allison Schrager has an interesting article about how marketplaces for contraband drugs have only existed for about four years on the dark web, but they've made inroads fast. About 10%-15% of drug users in the U.K., U.S., and Australia [are believed to have] bought drugs off the net. According to Schrager, these marketplaces look remarkably similar to normal online marketplaces. Users leave detailed reviews on the quality of a vendor's product, speed of delivery, and how secure the shipping method was. There's information on where vendors are located and where they'll ship to. Some even post their refund and exchange policies. Purchasing meth from a dealer in the Netherlands feels as familiar and mundane as buying sheets from Macy's. The dark web makes transactions safer.

All the same, there are risks that Macy's customers don't run. Because there's no legal protection for illegal purchases, the bitcoin payments sit in escrow until the goods have been delivered and both parties are satisfied. That exposes the seller to exchange-rate risk, because bitcoin is an extremely volatile currency. And there is one other big source of risk: the point where the virtual world of the dark web and the world of physical reality intersect. In other words, getting drugs delivered. Certain drugs like MDMA and LSD may move mostly online. And the web may become the preferred source for affluent users and small-time pot dealers.

Bitcoin Is Officially a Commodity 59

Taco Cowboy writes: According to the Commodity Futures Trading Commission (CFTC), Bitcoin and other all virtual currencies have been officially categorized as commodities, just like crude oil or wheat. The CFTC on Thursday announced it had filed and settled charges against a Bitcoin exchange for facilitating the trading of option contracts on its platform.

By this action, the CFTC asserts its authority to provide oversight of the trading of cryptocurrency futures and options, which will now be subject to the agency's regulations. In the event of wrongdoing, such as futures manipulation, the CFTC will be able to bring charges against bad actors. If a company wants to operate a trading platform for Bitcoin derivatives or futures, it will need to register as a swap execution facility or designated contract market, just like the CME Group. And Coinflip—the target of the CFTC action—is hardly the only company that provides a platform to trade Bitcoin derivatives or futures
In other Bitcoin news, reader McGruber notes that the CFO of BitPay, a Bitcoin payment service, was successfully phished, costing the company $1.8 million worth of Bitcoins. The company is attempting to recover the money from its insurer.

Bitcoin Trader Agrees To Work For Police In Plea Agreement 111

An anonymous reader writes: Florida Bitcoin trader Pascal Reid, who was arrested in a February 2014 sting operation as part of his plea agreement, promised to carry out 20 sessions of law enforcement training in Bitcoin as well as serve as a consultant in criminal cases involving Bitcoin. This is in addition to 90 days in jail with credit for time served and a $500 reimbursement to the State of Florida for the expense of prosecuting him. Qntra has a write up on the case and the full text of the draft plea agreement.

Video Bitcoin and Beyond

Circle is building a new consumer finance company with radically different unit economics, they're also leveraging mobile and social trends to drive global adoption. Here's a look at the how's and why's.

Nine of World's Biggest Banks Create Blockchain Partnership 93

An anonymous reader writes: Nine major banks, including Barclays, Goldman Sachs, Credit Suisse, and JP Morgan have teamed up to bring Bitcoin's blockchain technology to financial markets. "Over the past year, interest in blockchain technology has grown rapidly. It has already attracted significant investment from many major banks, which reckon it could save them money by making their operations faster, more efficient and more transparent." Leaving aside the question of whether banks actually want to become more transparent, they're funding a firm dedicated to running tests on how data can be shared and collected through the blockchain. "The blockchain works as a huge, decentralized ledger of every bitcoin transaction ever made that is verified and shared by a global network of computers and therefore is virtually tamper-proof. ... The data that can be secured using the technology is not restricted to bitcoin transactions. Two parties could use it to exchange any other information, within minutes and with no need for a third party to verify it."