16.5.2.1. Phishing Attack¶

Phishing attacks are the methods of stealing data or money from users by using social engineering methods. This includes asking for credentials or giving a link to a false log in for accounts. One such example of phishing for cryptocurrency is called spear phishing. Spear phishing targets individuals with messages designed specifically for them. The senders of these messages pretend to be trusted sources and ask for sensitive information or send them to a website filled with malware. In the case of cryptocurrency, this type of phishing pretends to originate from the users’ wallets.

Another phishing scheme related to cryptocurrency is replacing the address of the website in the Domain Name Service, DNS, so when the browser completes the request for the website’s location on a server, the result is a website created by an attacker. From there, the attacker will gain user information once the user logs in. The user typically accesses this page from a phishing email as listed in the previous paragraph.

[I am not sure what is the point to including this discussion. This does not have anything to do with cryptocurrency in particular, or with blockchain. Its just general online scamming and hacking.]

16.5.2.2. 51% Attack¶

A 51% attack can be initiated by an individual, a company, or a group that has their mining resources collected together as one unit. The entity or group has 51% or more of the resources related to the consensus algorithm in the cryptocurrency network. For a proof of work system, this means that the actor has the majority of the mining power. For proof of stake systems, this means that the investor has a majority of the available coin staked into the system, increasing the influence they have on the network (see Proof Of Stake).

The chance of this happening in a developed cryptocurrency is not significant, but they do still occur. [Need Examples] Once a person has the majority in computing power or stake, they can target individuals by hacking their wallets and obtaining information from their [… looks like something missing here.]

Overall, there is not much legislation related to 51% attacks or a user’s ability to gain 51% of the computing power. Given that cryptocurrency usage is increasing worldwide, this may change.

16.5.2.3. Cryptojacking¶

Cryptojacking is the act of attaching cryptomining code onto what seems to be trustworthy items. There are three methods of cryptojacking including attaching malware onto emails, embedding malicious code into websites, and cloud cryptojacking. This type of crypto hacking is typically used to mine cryptocurrency that uses a proof of work system.

File-based cryptojacking is the practice of attaching malware on links in emails. These links, when clicked, download malware onto the computer and then runs an executable. From there, the executable begins mining cryptocurrency for the hacker using the computer’s or system’s resources. This typically runs without the user being aware of anything occurring. This method would target users in a proof of work system such as bitcoin. However, the user may notice their system slowing down or an excess use in the computer’s CPU.

Browser-Based Cryptojacking or the act of embedding malicious code into websites or advertisements, uses the computer’s system to run a cryptomining script. Once the object the code is embeded in is clicked on, the script begins to mine coins without downloading files. These objects the code is embedded in are typically advertisements or features that are out of date (vulnerable to security threats).

The last main type of cryptojacking is cloud cryptojacking or using an organization’s file structure to gain access to their cloud services. Then the hackers use the resources the company has in the cloud to mine cryptocurrency. [Vague – needs more explanation.]

16.5.3.1. Phishing Attacks¶

For protecting against phishing, practice strategies taught by Virginia Tech and employers. Such practices include reporting emails thought to be suspicious and do not open unknown links and do not provide log in information from links given in emails. Do not use public Wi-Fi networks to access accounts because you cannot verify if the traffic is being observed. Use multi-factor authentification to guaruntee the user is who should be logging into the system. [None of this seems related to blockchain.]

In addition, to mitigate the affects for DNS phishing, use a Virtual Private Network (VPN) to send data on encrypted networks. Also, verifying URLs for trusted certificates aids in ensuring the website is trustable.

16.5.3.2. 51% Attack¶

Although the attack is different than a phishing attack, several mitigation strategies are shared between the two hacking strategies. The first is using two-step authentication on wallets to prevent unauthorized users from accessing their data. To prevent large amounts of cryptocurrency from being stolen from wallets, maintain several wallets with small amounts of coin in it. That way, if one of the wallets have been compromised, only a small percentage of the wealth could be lost. Also keep track of any transactions in the accounts to determine if someone has issued a 51% attack on the system. If your account is affected, report the suspicious transaction(s) to the company that the wallet is made with. [I think that we don’t have an explanation anywhere in the tutorial about what a wallet is.]