Two months ago, BTC-China was growing fast.It was on a blazing trajectory that would soon see it become the world’s largest Bitcoin exchange.With Bitcoin, the world’s most popular digital currency, in the midst of an tremendous upswing of its own, BTC was on the verge of hitting it very, very big.But before that, there would be the double-barreled rite of passage.First came the extortion attempt, and then the non-stop computer attacks, known as distributed denial of service (DDoS) attacks.The extortionists contacted BTC-China in mid-September.Over instant-message chats, they first said they wanted just a few hundred dollars — paid out in bitcoins, naturally — but the demands soon escalated.BTC-China CEO Bobby Lee doesn’t want to get into specifics, but he says that they claimed to have been hired by one of his competitors.He doesn’t believe this, but he thinks that other Bitcoin companies should be concerned.“The DDoS attackers are hitting more and more of us, and it’s going to be a widespread problem,” he says.

Since, September, there have been dozens of these attacks on BTC-China.According to Lee, one of them used up a remarkable 100 G/bits per second in bandwidth.bitcoin encryption explained“They’re throwing big-time resources into these attacks,” says Marc Gaffan, co-founder of Incapsula, the company that Lee hired to protect his exchange from the criminals.bitcoin atm reviews“The attack on BTC-China was one of the largest ever.” Incapsula has about two-dozen clients that are involved in Bitcoin businesses, Gaffin says.bitcoin atm reviewA year ago, it had none.ethereum open source projectsCloudFlare, another provider of DDoS protection services has seen a big jump in attacks over the past three months, says Matthew Prince, the company’s CEO.bitcoin risk factors for insurance

“We’re seeing daily attacks targeting Bitcoin related sites on our network, most of which are relatively small but some get to very high volumes.” Some attacks have even exceeded the 100 G/bits per second volume that hit BTC-China, he says.tesla bitcoin cnnYesterday, European payment processor BIPS said it had been hit with a DDoS attack, and then hacked to the tune of nearly 1,300 bitcoins, or $1 million.daily beast bitcoinLast week, Bitstamp, another major Bitcoin Exchange, went offline temporarily.bitcoin payout paypalThe company has not responded to requests for comment, but it blamed the outage on software and networking issues, not a DDoS.uso dei bitcoinOn most websites, hackers can steal credit card numbers or personal information, but these have to be sold somehow.

When you break into a Bitcoin business and get access to digital wallets, as was the case with BIPS and an Australian company, Inputs.io, which was hit last month, you’re stealing money itself.“If a Bitcoin wallet can get compromised, then the hackers can actually steal real money and there’s no way to refund the money,” Lee says.Gox got clobbered via DDoS.The point, the company speculated, was to destabilize Bitcoin, and fuel panic-selling.“
Attackers wait until the price of bitcoins reaches a certain value, sell, destabilize the exchange, wait for everybody to panic-sell their bitcoins, wait for the price to drop to a certain amount, then stop the attack and start buying as much as they can,” Mt.Gox wrote on its website.Gaffan and Lee agree that, in addition to extortion, market manipulation is likely a motive with the recent DDoS attacks too.“It’s about trying to influence the market,” Gaffan says.“We see more Bitcoin exchanges going under attack.”Your Network or Your Bitcoins: Three Rules for Dealing with DDoS Extortion Threats Tom Bienkowski on One of the most common – and infuriating – motivations for a DDoS attack is extortion, where an attacker threatens to take down a site unless the victim pays, typically in the form of a Bitcoin transaction.

These types of attacks have increased in intensity and volume over the year, and show no sign of slowing down.In fact, according to our 11th Worldwide Infrastructure Security Report,“Extortion was the motivation behind 35% of DDoS attacks.One notable DDoS extortionist is the individual or group called DD4BC (‘DDoS for Bitcoin’) that has attacked dozens of companies (at least) since emerging on the scene in 2014.DD4BC began his/her/its prolific career with attacks on Bitcoin exchanges before branching out to online gaming sites that use Bitcoins as currency, then to prominent financial institutions worldwide, and more recently to ISPs and other verticals.DD4BC devised a simple formula for extorting funds that worked across different industries and became a model for others to follow.They would send you an email introducing themselves as the dreaded DD4BC, and explain that they’re about to launch a DDoS attack against your organization unless you drop a specified number of bitcoins in a particular account.

If you don’t pay on time, they’ll launch the attack and the price will increase.The attacker would probably also warn that it’s impossible to block the attack, so don’t even try – it will only make matters worse.The email would then come to a polite conclusion, something like this: IMPORTANT: It’s a one-time payment.Pay, and you will not hear from us ever again!We do bad things, but we keep our word.Thank You, DD4BC What a nice guy!I think the last line is priceless.A number of companies fell victim, paid the Bitcoins and then (what a surprise!)They learned the hard way that DD4BC was not so nice or trustworthy after all.There’s a lesson here, if you haven’t figured it out already: never trust a criminal.(or if you’re a parent like me, never trust a teenager…at least verify) DD4BC even put the “white hat” on and offered to help with DDoS defense.As happens quite often in the attacker/hacker communities of the Darknet, the success of DD4BC has inspired a number of copycats, who see a way to make easy money by replicating the approach.

They often use similar wording in their emails (by copying and pasting) and similar attack code (ditto).Keep in mind, these attacks are not technically complex, and the DDoS attack services/tools are readily available in underground forums.Almost anyone with a browser can rent a botnet at minimal cost, launch an attack and send an email to hapless victims demanding payment.They’re just hoping to get lucky and catch someone who doesn’t have mitigation capabilities in place, and will fall for their pitch.What Should We Do if We’re Attacked?If your organization is the victim of DDoS extortion, remember to always follow these rules: Rule #1:  Don’t Pay Rule #2:  Don’t Pay Rule #3:  Don’t Pay!If you are threatened or attacked, never pay because that just opens you to more attacks from criminals who see you see as an easy target and keep returning to extort more money.Trust me, we’ve seen this happen.More seriously, here are three recommendations for defending yourself against DDoS extortion.

React: Take any extortion threat seriously.Immediately turn up an incident response team to manage the attack.Mitigate: If you don’t own any DDoS mitigation products or subscribe to a managed service, at a very minimum, immediately contact your ISP or a Managed DDoS Service Provider (e.g.Arbor Networks) to put some temporary protection in place.Most DDoS protection service providers will offer this initial service free of charge until you get your feet back under you.Then they’ll talk business.Notify: Notify law enforcement about the threat – even if attackers did not follow through – so they can amass better intelligence to pursue the attackers or notify other potential targets in your industry.It’s another reminder that preparation is key to avoid painful downtime and potentially devastating service disruptions.Time and again, organizations with an effective DDoS mitigation strategy were not affected when attacked by DD4BC or other DDoS extortionists.The takeaway: be proactive and make sure you have DDoS attack protection in place so if you are threatened, you’ll be able to repel the attack rather than become the next victim.