BlogLine

HBd BTC!

1/3/18

By: Daniel C. Walsh
Happy 9^th Birthday to bitcoin (“BTC”), easily one of the most controversial topics of 2017 that will surely continue to inspire debate through 2018.  Nine years ago today, the very first block on the bitcoin blockchain, also known as the “Genesis Block”, was mined, resulting in a 50 BTC reward to the miner.  While that reward was worth very little in 2009, the value in today’s dollars as of the writing of this blog is a staggering $753,750.25!
Whether you believe BTC is the next great bubble or the future world currency, most people familiar with the underlying blockchain technology agree that it is here to stay.  Blockchain allows for a public, decentralized transaction ledger that eliminates the necessity for a financial middleman.  It also prevents fraud, as each transaction requires confirmation on the network by way of complex mathematical equations solved by high powered computers.  Once a transaction is included in a block on the blockchain, it is there forever, as each subsequent block in the chain builds upon and cannot disturb the last.  Think of it like that scene in Jurassic Park where the scientists show layer upon layer of amber covering the mosquito over time, preserving the contents inside.  Thankfully (hopefully?), blockchain’s amber won’t lead to the mass production of dinosaurs…
One of the many utilizations of cryptocurrency in general, and BTC specifically, is anonymous virtual transactions (as previously discussed here).  FMG’s Data Security, Privacy, and Cyber Liability practice team frequently sees this utilization in conjunction with Ransomware attacks, wherein a hacker installs malware on a company or individual’s server that holds the data hostage until a ransom is paid.  Up until now, that ransom was usually demanded in BTC.  But with the numerous “forks” in the BTC blockchain leading to alternative cryptocurrencies such as Bitcoin Cash, Bitcoin Gold, Super Bitcoin, and the recent SegWit2x upgrade, the virtual currency landscape is becoming increasingly more complex.  Adding to this confusion are the virtual currencies aimed at total anonymity, such as Monero and Zcash, which are gaining traction in Ransomware demands, and require currency conversions from BTC, often through multiple online exchanges.  Successfully navigating this minefield when dealing with a Ransomware attack is critical to the recovery and security of your data, and FMG’s Data Security, Privacy, and Cyber Liability practice team has the knowledge and experience to help you along the way.
If you have any questions or would like more information, please contact Daniel Walsh at dwalsh@fmglaw.com.