What is bitcoin, how do I buy it and why do ransomware criminals want them, Metro News
What is bitcoin, how do I buy it and why do ransomware criminals want them?
Cyber criminals were widely reported as having demanded ‘bitcoins’ in their ransom requests last week.
Thousands of computers around the world were infected with ransomware on Friday with users files locked and requests for bitcoin payments to permit access.
NHS hospitals, GP surgeries, pharmacies, FedEx and Spain’s main telecoms provider Telefonica were among those targetted in the cyber onslaught, which is however to have affected one hundred fifty countries.
In Britain, the attack meant hundreds of operations were cancelled as well as patient files, test results and X-rays being unavailable – with fears the attack could begin up again this week as workers comeback to their computers.
But why did the cyber criminals request bitcoins? And what re they? Here is everything you need to know.
What is bitcoin?
Bitcoin is a decentralised digital currency, meaning neither does it exist in the physical world, nor does it have a central bank such as the Federal Reserve or the Bank of England. There are also a finite number of bitcoins in the world, according to Bitcoin.org.
Only twenty one million bitcoins exist but this is not seen as a limitation because bitcoins can be violated down into smaller sub-units of bits with 1,000,000 bits in one bitcoin. Bitcoins can be divided up to eight decimal places (0.000 zero 01) and potentially even smaller units.
Why do ransomware criminals want it?
Bitcoins are not actually anonymous, according to Bitcoin.org. There are public records that track the spending of bitcoin.
However there is an element of privacy involved in the digital currency as well as it being unlikely to counterfeit, immune to fraudulent chargebacks and transactions being irreversible. This, as well as the currency being global, have led to concerns that it is an attractive currency for criminals.
Who invented bitcoin?
Bitcoin was introduced in two thousand nine by a mysterious programmer known only as Satoshi Nakamoto, which is thought to be a pseudonym, and who has never given an interview. Previously the domain of technology-friendly libertarians, bitcoin has shot to mainstream financial attention after its value enlargened by up to 1,000 per cent since the embark of the year.
The rise of bitcoin also coincided with the tipping point of the financial crisis in Cyprus, when it was announced individual savers faced a one-off levy in order for a eurozone bailout to go ahead. In light of governments raiding savings in this way, the prospect of a currency free from government regulation and interference all of a sudden becomes much more enticing. However, the US Treasury has previously made moves to apply laundering rules to virtual currencies such as bitcoin.
How do I get bitcoins?
The very first step is to visit bitcoin.org and download a ‘wallet’ on your computer or mobile. Bitcoin uses peer-to-peer networking and digital signatures where the money supply is automated and given to servers known as ‘bitcoin miners’. Bitcoins, in blocks of 25, are awarded to these miners when their computer generates a 64-digit number from a elaborate algorithm. It is helpful to think of bitcoin more as a commodity being mined rather than a traditional currency of which central banks can always create more of.
Can I buy bitcoins directly?
Yes, the most popular way is via online exchanges, or via bank transfer on websites including Coinbase. Sellers can also be found directly online or even by meeting them in person.
What can I buy with bitcoins?
Technically anything, albeit virtually no mainstream retailers presently accept them. Blogging platform WordPress and WikiLeaks both accept bitcoin, while some sites suggest bounty vouchers for retailers such as Amazon. There are also websites selling electronic goods that exclusively accept bitcoin. The dark side to bitcoin is how it is accepted on sites such as anonymous marketplace Silk Road, where users can buy illegal drugs such as LSD.
Can I make money with bitcoin?
The big question is whether bitcoin is truly a self-stabilising currency, with all the evidence so far pointing to no, with it having already shown massive fluctuations in price. In February two thousand fourteen a single bitcoin was worth $20, but two months later on April ten its value crashed from $266 to $105 before returning to $160 within several hours. Many mainstream economists regard bitcoin as a bubble waiting to pop, with comparisons made with Dutch tulip mania in the 17th century. Exchanges can also be vulnerable to distributed denial of service attacks, which can lower prices.
For more information you can read the bitcoin community’s own guide to the currency.