Submitted by Micah Smith on Mon, 01/15/2018 - 12:12
Is Bitcoin the safest currency?
Is Bitcoin the safest currency?

Bitcoin is the digital currency created and maintained electronically. Bitcoins are virtual, meaning that if you have bitcoins, unlike other currencies you won't have a stash of notes piling up under the mattress. Bitcoins aren't printed, like dollars or euros – they're used by people, and increasingly businesses globally.

Bitcoins are created as a reward for payment processing work, users offer computing power to verify and record payments in a public ledger, also known as mining. Miners are rewarded with Bitcoins, which can be traded for other currencies or services. With similarities to old school bartering, Bitcoin has put a virtual spin on this type of trading.

We are continually reminded about how great Bitcoin is, how safe to store and use.

But is it? To any cyber tech enthusiast, the first question that comes to mind is: how easy is it to hack?

If all you need is a login, then how much harder is it for cyber criminals to hack into Bitcoin accounts than to the British Parliament?

As if the question had predicted a thunderstorm, the inevitable happened. A few days ago, Bithumb, the fourth largest Bitcoin exchange and the largest Ehtereum exchange worldwide, was hacked. It’s located in South Korea and it was reported that 1.2 billion won (South Korean currency) were stolen, which is equivalent to $1 million dollars.

Even though a staggering 31,800 accounts were broken into, Bithumb said that it equaled a mere 3% of their customers. You can only imagine how many people use Bitcoin in South Korea.

To give you a better illustration, there are a total of 16,430,200 Bitcoins in the world. That’s equivalent to 42.7 billion dollars.

The reason it was so easy for the hackers to get into those Bithumb accounts was because of weak temporary passwords. So, if everyone uses super complex strong passwords, could someone still potentially hack and steal Bitcoins?

For all of us that know the cyber industry at any level, the answer is always “yes”. There is no software in the world that is completely bulletproof.

Blockchain, the ledger that records all Bitcoin transactions, has a 6-layer system that has computers jumping through hoops to verify the identity and validity of each Bitcoin transaction. At the same time, if a cyber attacker gets control of 51% of the Blockchain mechanism then there is the potential to injure the authentication mechanism completely. Blockchain would have to have back-ups on their back -ups to deal with this.

This poses an obvious threat to Bitcoin users. With all the government-backed groups of hackers around the world what would stop a rogue nation from investing money and time in order to hack into people’s Bitcoin accounts?

The plus side is that warfare could be restricted to the web and to cyber weapons, instead of nuclear warheads, but hospitals and factories could be affected as a result, like we saw in the massive international ransomware attack.

No software is safe, which makes Bitcoin susceptible to cyber-attacks like any other software out there.

So how do you keep your Bitcoin safer? Use multiple signatures, back it up often, and keep all of your software up to date. Also, use a small amount of Bitcoin at any given time in order not to raise flags.

In conclusion, if you use Bitcoin regularly, your fate rests in the proper management and security of the various Bitcoin companies, and on the mood of potential Nationalist hackers.