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Bitcoin is not the Root Cause of Ransomware
Peter Van Valkenburgh, Director of Research at Coin Center
coincenter.org
Breach Encryption Payment
Breach Ransomware software gains root access to computer. Usually because somebody opened an email attachment they shouldn’t have.
Encryption
Software searches all connected drives and encrypts non-system files. Files on that computer and any connected drive with read/write access are now inaccessible. Decryption key is retained by hackers on a remote server they control.
Payment Upon boot, infected computer displays an explanation of why files can no longer be opened and a demand for payment in exchange for decryption key.
Breach Encryption Payment
Criminals building ransomware don’t
use Bitcoin because it is “anonymous” ...
they use it because it “ just works.”
Not anonymous?
What is a Blockchain?
Quick Review: Before Bitcoin
(online) BANKING
Analog
Bank of America Users World Population
Commerzbank:$? Bank of America:$?
Peter: $200 Antonie: $200
Bank of America:$200
Commerzbank:$200
ING:$200 ING:$200
Peter: $190 Antonie: $200
Bank of America:$200
Commerzbank:$200
ING:$210 ING:$200
Peter: $190 Antonie: $200
Bank of America:$190
Commerzbank:$210
ING:$210 ING:$200
Peter: $190 Antonie: $210
Bank of America:$190
Commerzbank:$210
ING:$210 ING:$190
Takes about three business days.
Takes about three seconds.
Analog
Peer to Peer Blockchain
Recipe for Digital Money
Bitcoin Protocol
Permissionless
Only need: Free sof t w are.
Int ernet connect ion.
Peer to Peer Electronic Cash
ten_dollars.mny
ten_dollars.mny
ten_dollars.mny
ten_dollars.mny
ten_dollars.mny
ten_dollars.mny
ten_dollars.mny
ten_dollars.mny
X X
X
Blockchain transaction transaction transaction transaction transaction transaction etc.
Many ledgers becomes one super ledger, the blockchain!
X X X
Blockchain transaction transaction transaction transaction transaction transaction etc.
Many ledgers becomes one super ledger, the blockchain
Identical Copies of that ledger are held by every peer in the network.
Blockchain transaction transac
Blockchain transaction transac
Blockchain transaction transac
Blockchain transaction transac
Blockchain transaction transac
Blockchain transaction transaction transaction transaction transaction transaction
transaction transaction transaction transaction transaction transaction
transaction transaction transaction transaction transaction transaction
transaction transaction transaction transaction transaction transaction
transaction transaction transaction ADD THIS NEW TRANSACTION? Y/N
Yes!
Yes!
Yes!
Yes!
Yes!
The network of peers agrees (reaches consensus) on the state of that ledger.
Blockchain transaction transac
Blockchain transaction transac
Blockchain transaction transac
Blockchain transaction transac
Blockchain transaction transac
Publ ic Address: 3J98t1WpEZ73CNmQviecrnyiWrnqRhWNLy Publ ic Key: 0488ff723a55ae8f46d9decf66c10a249adb59ac91195adee879ecb5944ea7f5098dd9e193c2172047e6eacb6ddd524c77ee5669b2f69bbfb27fc03d717d657195 Pr ivate Key: e6edcf30220499bd034a7f4ebbadd4d62c89995c01157067983b4f1f26b58111
A Bitcoin Address The address where you can receive bitcoins.
The key that you must have in order to send bitcoins from your address.
Keys are linked because of a cryptographic function called ECDSA. This function generates two verifiably matched keys. It’s the same mathematics used to secure communications on the Internet.
50
A Bitcoin Transaction Message 51
To send someone a bitcoin, you must create a transaction message. The message has four essential parts:
1. The public address(es) of the recipient(s). 2. The amount(s) being sent to the recipient(s). 3. A list of previous transactions that were sent to the
sender, and that will be used to fund the new transaction. 4. The digital signature of the sender to prove that they were
the recipient of those previous transactions.
1. Destination 2. Amount 3. Source of Funds 4. Proof of Possession
Criminals building ransomware don’t
use Bitcoin because it is “anonymous” ...
they use it because it “ just works.”
Questions? Please visit coincenter.org to learn more.