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Bitcoin

Kim Dotcom Will Revive Megaupload, Linking File Transfers To Bitcoin Microtransactions (fortune.com) 57

Long-time Slashdot reader SonicSpike quotes an article from Fortune: The controversial entrepreneur Kim Dotcom said last month that he was preparing to relaunch Megaupload, the file-sharing site that U.S. and New Zealand authorities dramatically shut down in 2012, with bitcoins being involved in some way... This system will be called Bitcache, and Dotcom claimed its launch would send the bitcoin price soaring way above its current $575 value.

The launch of Megaupload 2.0 will take place on January 20, 2017, he said, urging people to "buy bitcoin while cheap, like right now, trust me..." Crucially, Dotcom said the Bitcache system would overcome bitcoin's scaling problems. "It eliminates all blockchain limitations," he claimed.

Every file transfer taking place over Megaupload "will be linked to a tiny Bitcoin micro transaction," Dotcom posted on Twitter. His extradition trial begins Monday, and he's asking the court to allow live-streaming of the trial "because of global interest in my case." Meanwhile, the FBI apparently let the registration lapse on the Megaupload domain, which they seized in 2012, and Ars Technica reports that the site is now full of porn ads.
Bitcoin

'SingularDTV' Will Use Ethereum For DRM On A Sci-Fi TV Show (rocknerd.co.uk) 78

It's "an epic sci-fi adventure about the human race's journey into a theoretical technological Singularity." Or is it an "entertainment industry boondoggle...part DRM snake oil marketing, part pseudo-Bitcoin scam and part sincere Singularitarian weirdness?" Long-term Slashdot reader David Gerard writes: SingularDTV is an exciting new blockchain-based entertainment industry startup. Their plan is to adapt the DRM that made $121.54 for Imogen Heap, make their own completely pre-mined altcoin and use that to somehow sell two million views of a sci-fi TV show about the Singularity. Using CODE, which is explicitly modeled on The DAO ... which spectacularly imploded days after its launch. There's a white paper [PDF], but here's an analysis of why these schemes are a terrible idea for musicians.
'Singular' will be a one-hour adventure/drama "that explores the impact technology will have on the future of our planet and how it will shape the evolution of our human race," set in the years 2021 to 2045, "as an unprecedented technological revolution sweeps over the world..."
Security

New Linux Trojan Is A DDoS Tool, a Bitcoin Miner, and Web Ransomware (softpedia.com) 63

An anonymous reader writes: A trojan that targeted Drupal sites on Linux servers last May that was incredibly simplistic and laughable in its attempt to install (and fail) web ransomware on compromised websites, has now received a major update and has become a top threat on the malware scene. That trojan, named Rex, has evolved in only three months into an all-around threat that can: (1) compromise servers and devices running platforms like Drupal, WordPress, Magento, Jetspeed, Exarid, AirOS; (2) install cryptocurrency mining in the background; (3) send spam; (4) use a complex P2P structure to manage its botnet; and (5) install a DDoS agent which crooks use to launch DDoS attacks.

Worse is that they use their DDoS capabilities to extort companies. The crooks send emails to server owners announcing them of 15-minute DDoS tests, as a forewarning of future attacks unless they pay a ransom. To scare victims, they pose as a known hacking group named Armada Collective. Other groups have used the same tactic, posing as Armada Collective, and extorting companies, according to CloudFlare.

Bitcoin

DDoSCoin: New Crypto-Currency Rewards Users For Participating In DDoS Attacks (softpedia.com) 45

An anonymous reader writes from a report via Softpedia: "In the most innovative, weirdest, and stupidest idea of the month, two researchers from the University of Colorado Boulder and the University of Michigan have created a crypto-currency that rewards people for participating in DDoS attacks," reports Softpedia. "Called DDoSCoin, this digital currency rewards a person (the miner) for using their computer as part of a DDoS attack. Just like Bitcoin, DDoSCoin uses cryptographic data to provide a proof-of-work. In DDoSCoin's case, this proof-of-work is extracted from the TLS connection a miner establishes with the website they're supposed to attack." This means that DDoSCoin can be used only with DDoS attacks on TLS-enabled websites. Participating in DDoS attacks gives miners DDoSCoin, which can then be converted in Bitcoin or fiat currency. Furthermore, anyone can request a DDoS attack via the PAY_TO_DDOS transaction. The research paper that proposes DDoSCoin is only a theoretical exercise, and a DDoSCoin crypto-currency does not currently exist in the real world. For now.
Crime

Kansas Couple Sues IP Mapping Firm For Turning Their Life Into a 'Digital Hell' (arstechnica.com) 175

Ever since James and Theresa Arnold moved into their rented 623-acre farm in Butler County, Kansas, in March 2011, they have seen "countless" law enforcement officials and individuals turning up at their farm day and night looking for links to alleged theft and other supposed crime. We covered this story on Slashdot a few months ago. All of these people are arriving because of a rounding error on a GPS location, which wrongly points people to their farm. ArsTechnica adds:In their lawsuit filed against MaxMind, the IP mapping firm, the Arnolds allege: "The following events appeared to originate at the residence and brought trespassers and/or law enforcement to the plaintiffs' home at all hours of the night and day: stolen cars, fraud related to tax returns and bitcoin, stolen credit cards, suicide calls, private investigators, stolen social media accounts, fund raising events, and numerous other events." James Arnold has even been "reported as holding girls at the residence for the purpose of making pornographic films."
United States

US To Auction $1.6 Million Worth of Bitcoin From Various Cases (reuters.com) 67

An anonymous reader shares a Reuters report: The U.S. government said on Monday it plans to auction over 2,700 bitcoin that were forfeited during several cases, including the prosecution of the creator of the online black market known as Silk Road. The U.S. Marshals Service said that the online auction would be held on Aug. 22, and that potential bidders must register by Aug. 18. The bitcoin are worth about $1.6 million, according to the Bitstamp exchange. The auction is the latest by the Marshals Service of the digital currency. It completed four prior auctions from June 2014 to November 2015 of bitcoin seized during the prosecution of Ross Ulbricht, who authorities say ran Silk Road.
Security

Hackers Bring Ethics To Las Vegas (backchannel.com) 33

Steven Levy, who has been extensively covering the world of hackers for decades (fun fact: the first time he wrote about it, the word "hacker" didn't really mean much), is sharing the changing perception about hacker conferences, and hackers themselves. In a newsletter, Backchannel's Levy writes about Black Hat conference: What I find most striking in the coverage of these events is that they are no longer seen as outlaw gatherings, but rather conclaves that form a valuable portion of the digital security mosaic. This is a big change from the long period, beginning in the late 1980s, during which the term "hacker" became synonymous with malfeasants, punks, and criminals. The glorious originals -- people who invented just about everything great we do on computers, including the internet -- were outraged at the denigration of a word that was once a badge of honor. [...]
The hackers who attend those conferences are true to that ethic. There's a core morality to both events, built on privacy, equal access to systems, and personal freedom. There's indignation at poorly built systems. There's contempt at those who see computers and the internet as means of controlling people instead of seeing them as tools of liberation.
So who gets to decide what a hacker is in 2016? The question comes up constantly because the term retains some fuzziness. I'll put aside the unquestioned hacker status of coders and designers who innovate on products and private infrastructure. Blissfully, it's now OK for Silicon Valley geeks to proudly declare themselves hackers, the best example of which is Facebook CEO Mark Zuckerberg's naming of his corporate philosophy as "The Hacker Way." But I'm wondering about those people who take the law into their own hands, sometimes not even taking care to limit collateral damage of innocent people. While true hackers generally don't wreak actual destruction, there are some who invade or even tamper with systems for what they consider moral purposes. Some call it hacktivism. Does that mean they are still hackers? That's tough to answer. Hacking into a system doesn't make you a hacker. Using a computer to steal a credit card or a Bitcoin doesn't do it, either. If you work for China and hack into Google; if you work for Russia and hack into the DNC; or if you work for the United States of America and plant a software time bomb in a nuclear centrifuge in Iran -- you are not necessarily a hacker.

Bitcoin

Bitcoin Exchange Bitfinex Says It Was Hacked, Roughly $60M Stolen (reuters.com) 117

An anonymous reader quotes a report from Reuters: Hong Kong-based digital currency exchange Bitfinex said late on Tuesday it has suspended trading on its exchange after it discovered a security breach, according to a company statement on its website. The company said it has also suspended deposits and withdrawals of digital currencies from the exchange. "We are investigating the breach to determine what happened, but we know that some of our users have had their bitcoins stolen," the company said. "We are undertaking a review to determine which users have been affected by the breach. While we conduct this initial investigation and secure our environment, bitfinex.com will be taken down and the maintenance page will be left up." The company said it has reported the theft to law enforcement. It said it has not yet determined the value of digital currencies stolen from customer accounts. CoinDesk reports that the company confirmed roughly 120,000 BTC (more than $60 million) has been stolen via social media. "In response, bitcoin prices fell to $560.16 by 19:30 UTC, $530 by 23:30 and $480 at press time, CoinDesk USD Bitcoin Price Index (BPI) data reveals," reports CoinDesk. "This price was roughly 20% lower than the day's opening of $607.37 and 27% below the high of $658.28 reached on Saturday, July 30th, when the digital currency began pushing lower."
Security

Hacker Selling Data For 200 Million Yahoo Users On The Dark Web (softpedia.com) 65

An anonymous reader writes from a report via Softpedia: A listing was published today on TheRealDeal Dark Web marketplace claiming to be offering data on over 200 million Yahoo users, sold by the same hacker that was behind the LinkedIn, Tumblr, MySpace, and VK data dumps. In statements to Softpedia, Yahoo said it was investigating the breach, but based on the seller's reputation, it is very likely the data is authentic. The data is up for sale for 3 Bitcoin (approximately ~$1,800), and based on the sample the hacker provided, the data dump includes details such as usernames, MD5-hashed passwords, and dates of birth for all users. For some records, there is also a backup email address, country of origin, and ZIP code for U.S. users. The hacker, called Peace, has also told Softpedia that he previously made $50,000 from the LinkedIn breach alone, and over $65,000 in total from all breaches.
Bitcoin

North Korea Is Blackmailing Top South Korean Online Retailer For $2.66 Million (softpedia.com) 45

An anonymous reader writes from a report via Softpedia: South Korea says that North Korea is behind a data breach that occurred last May, where hackers stole details about 10 million user accounts from Interpark.com, one of the country's biggest shopping portals. The hackers later tried to extort Interpark management by requesting for 3 billion won ($2.66 million / 2.39 million euros), otherwise they were going to release the data on the internet. [The hackers wanted the money transferred to their accounts as Bitcoin.] Authorities say they tracked the source of the hack to an IP in North Korea, previously used in other attacks on South Korean infrastructure. "Besides the evidence related to the IP addresses and the techniques used in the attacks, investigators also said that the emails Interpark management received, written in the Korean language, contained words and vocabulary expressions that are only used in the North," reports Softpedia.
Bitcoin

EU Plans To Create Database of Bitcoin Users With Identities and Wallet Addresses (softpedia.com) 130

An anonymous reader writes from a report via Softpedia: "The European Commission is proposing the creation of a database that will hold information on users of virtual currencies," reports Softpedia. "The database will record data on the user's real world identity, along with all associated wallet addresses." The database will be made available to financial investigation agencies in order to track down users behind suspicious operations. The creation of this database is part of a regulatory push that the EU got rolling after the Paris November 2015 terror attacks, and which it officially put forward in February 2016, and later approved at the start of July 2016. Legally, this is an attempt to reform the Anti-Money Laundering Directive (AMLD). The current draft is available here. The current AMLD draft reads: "The report shall be accompanied, if necessary, by appropriate proposals, including, where appropriate, with respect to virtual currencies, empowerments to set-up and maintain a central database registering users' identities and wallet addresses accessible to FIUs, as well as self-declaration forms for the use of virtual currency users."
Bitcoin

Bitcoin Not Money, Rules Miami Judge In Dismissing Laundering Charges (miamiherald.com) 150

An anonymous reader quotes a report from Miami Herald: Bitcoin does not actually qualify as money, a Miami-Dade judge ruled Monday in throwing out criminal charges against a Miami Beach man charged with illegally selling the virtual currency. The defendant, Michell Espinoza, was charged with illegally selling and laundering $1,500 worth of Bitcoins to undercover detectives who told him they wanted to use the money to buy stolen credit-card numbers. But Miami-Dade Circuit Judge Teresa Mary Pooler ruled that Bitcoin was not backed by any government or bank, and was not "tangible wealth" and "cannot be hidden under a mattress like cash and gold bars." "The court is not an expert in economics, however, it is very clear, even to someone with limited knowledge in the area, the Bitcoin has a long way to go before it the equivalent of money," Pooler wrote in an eight-page order. The judge also wrote that Florida law -- which says someone can be charged with money laundering if they engage in a financial transaction that will "promote" illegal activity -- is way too vague to apply to Bitcoin. "This court is unwilling to punish a man for selling his property to another, when his actions fall under a statute that is so vaguely written that even legal professionals have difficulty finding a singular meaning," she wrote. Espinoza's case is believed to be the first money-laundering prosecution involving Bitcoin.
Bitcoin

'Tor and Bitcoin Hinder Anti-Piracy Efforts' (torrentfreak.com) 103

An anonymous reader writes: A new report published by the European Union Intellectual Property Office identifies a wide range of 'business models' that are used by pirate sites. The organization, which announced a new collaboration with Europol this week, signals Bitcoin and the Tor network as two key threats to ongoing anti-piracy efforts. According to the research, several infringing business models rely on encryption-based technologies. The Tor network and Bitcoin, for example, are repeatedly mentioned as part of this "shadow landscape." "It more and more relies on new encrypted technologies like the TOR browser and the Bitcoin virtual currency, which are employed by infringers of IPR to generate income and hide the proceeds of crime from the authorities," the report reads.
Bitcoin

Ex-Google Engineer Launches Blockchain-Based System For Banks (reuters.com) 62

An anonymous reader quotes a report from Reuters: A former Google engineer, whose speech recognition software is used in more than a billion Android smartphones, has launched a company that uses blockchain technology to build a new operating system for banks. Paul Taylor, a Cambridge University academic with an expertise in artificial intelligence, speech synthesis and machine learning, started working on the system, called Vault OS, two years ago in a basement in London's Shoreditch district, known for being a tech start-up hub. The technology, which underpins the digital currency bitcoin, creates a shared database in which participants can trace every transaction ever made. The ledger is tamper-proof and transparent, meaning that transactions can be processed without the need for third-party verification. The system also negates the need for costly in-house data centers, as it uses cloud-based systems, which banks can use on a "pay-as-you-go" basis, which means that there is no single point of failure. Taylor said major high-street banks were spending around a billion pounds ($1.3 billion) a year on computer technology, much of which he said was being used for propping up the current "legacy" systems rather than on any innovative technology. The start-up has been working with about ten banks, Taylor said, at least one of which would be starting a trial using the new system in August. He expects the system to be up-and-running within about a year. In banking-related news, a Congressional report shows that China's spies hacked into computers at the Federal Deposit Insurance Corporation (FDIC) from 2010 until 2013 and American government officials tried to cover it up.
Bitcoin

Bitcoin 'Miners' Face Fight For Survival As New Supply Halves (reuters.com) 164

SpzToid quotes a report from Reuters: On Saturday, the reward for [bitcoin] miners will be slashed in half. Written into bitcoin's code when it was invented in 2008 was a rule dictating that the prize would be halved every four years, in a step designed to keep a lid on bitcoin inflation. From around 1700 GMT on Saturday, instead of 25 bitcoins up for grabs globally every 10 minutes, worth around $16,000 at the current rate BTC=BTSP, there will be just 12.5. That means only the mining companies with the leanest operations will survive the ensuing profit hit. "The most important thing is to be the most efficient miner," said Streng, the 26-year-old co-founder of German firm Genesis Mining, which has "mining farms" in Canada, the United States and eastern Europe, as well as in Iceland. "When the others drop out, that means that they leave the market and give you a bigger share of the pie."
China

How China Took Control of Bitcoin (nytimes.com) 165

Slashdot reader Rick Zeman quotes the New York Times: In its early conception, Bitcoin was to exist beyond the control of any single government or country. It would be based everywhere and nowhere... Yet despite the talk of a borderless currency, a handful of Chinese companies have effectively assumed majority control of the Bitcoin network. They have done so through canny investments and vast farms of computer servers dispersed around the country...there are fears that China's government could decide, at some point, to pressure miners in the country to use their influence to alter the rules of the Bitcoin network. The government's intervention in 2013 suggests that Bitcoin is not too small to escape notice.
United Kingdom

Will Brexit Hurt International Cyber-Security? (helpnetsecurity.com) 197

The Brexit shock continues to reverberate throughout the global economic and policy worlds. Andrea Limbago from the security company Endgame responds to a poll showing that most security professionals have concerns about Brexit: Will it weaken cybersecurity because of additional bureaucratic hurdles to information sharing with the EU, as well limited cross-national collaboration in fighting cyber criminals? There is also concern about the possibility of a brain drain -- in-demand security talent pool fleeing the UK -- which could increasingly impact security and data protection.
Limbago suggests tech workers in Britain's financial sector may feel the impact, "with Bitcoin surging and the pound dropping.... London's role as the financial hub is now threatened thanks to the Brexit, the rise of digital currencies, and the EU's move toward greater digital integration." And there's also the possibility of "a push for digital sovereignty and greater national control over the Internet." But another poll found that 64% of information security professionals didn't think Brexit would affect Britain's ability to defend against cyber-attacks. Can security professionals continue their inter-nation cooperation, elevating data and security concerns over new administrative differences between Europe and the U.K.?
Bitcoin

Europe's 'Net Neutrality' Rules Fail to Ban BitTorrent Throttling (torrentfreak.com) 81

Europe has finally agreed on a set of net neutrality rules. According to a report on TorrentFreak, these rules offer improvements for some individual members states, various activist groups and experts. But the current language would also allow ISPs to throttle BitTorrent traffic permanently if that would optimize overall "transmission quality." From the report (edited):"Europe's new net-neutrality rules should ban throttling BitTorrent, but they don't. They leave ISPs a loophole," said Holmes Wilson of Fight for the Future (FFTF), one of the driving forces behind the Save Net Neutrality campaign. "ISPs can say they're doing it for 'traffic management' purposes -- even when their networks aren't clogged, because the rules say they can throttle to 'prevent impending network congestion,'" he adds. In addition to file-sharing traffic, the proposed rules also allow Internet providers to interfere with encrypted traffic including VPN connections. Since encrypted traffic can't be classified through deep packet inspection, ISPs may choose to de-prioritize it altogether. In theory, ISPs may choose to throttle any type of traffic they want, as long as they frame it as a network congestion risk. "So if your ISP is lazy, or wants to cut corners and save money, they can throttle BitTorrent, or VPNs, or Bitcoin, or Tor, or any class of traffic they can identify," Wilson says.
Bitcoin

New and Improved CryptXXX Ransomware Rakes In $45,000 In 3 Weeks (arstechnica.com) 124

An anonymous reader writes:Whoever said crime doesn't pay didn't know about the booming ransomware market. A case in point, the latest version of the scourge known as CryptXXX, which raked in more than $45,000 in less than three weeks. Over the past few months, CryptXXX developers have gone back and forth with security researchers. The whitehats from Kaspersky Lab provided a free tool that allowed victims to decrypt their precious data without paying the ransom, which typically reaches $500 or more. Then, CryptXXX developers would tweak their code to defeat the get-out-of-jail decryptor. The researchers would regain the upper hand by exploiting another weakness and so on. Earlier this month, the developers released a new CryptXXX variant that to date still has no decryptor available. Between June 4 and June 21, according to a blog post published Monday by security firm SentinelOne, the Bitcoin address associated with the new version had received 70 bitcoins, which at current prices is valued at around $45,228. The figure doesn't include revenue generated from previous campaigns.
Security

Crypto Ransomware Attacks Have Jumped 500% In The Last Year (onthewire.io) 36

Kaspersky Lab is reporting that the last year saw a 500% increase in the number of users who encountered crypto ransomware. Trailrunner7 shares an article from On The Wire: Data compiled by Kaspersky researchers from the company's cloud network shows that from April 2015 to March 2016, the volume of crypto ransomware encountered by users leapt from 131,111 to 718,536. That's a massive increase, especially considering the fact that ransomware is a somewhat mature threat. It didn't just burst onto the scene a couple of years ago. Kaspersky's researchers said the spike in crypto ransomware can be attributed to a small group of variants. "Looking at the malware groups that were active in the period covered by this report, it appears that a rather short list of suspects is responsible for most of the trouble caused by crypto-ransomware..."

It's difficult to overstate how much of an effect the emergence of ransomware has had on consumers, enterprises, and the security industry itself. The FBI has been warning users about crypto ransomware for some time now, and has consistently advised victims not to pay any ransoms. Security researchers have been publishing decryption tools for specific ransomware variants and law enforcement agencies have had some success in taking down ransomware gangs.

Enterprise targets now account for 13% of ransomware attacks, with attackers typically charging tens of thousands of dollars, the article reports, and "Recent attacks on networks at the University of Calgary and Hollywood Presbyterian Medical Center have demonstrated the brutal effectiveness of this strategy."

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