Assembling a diverse set of public, proprietary, and hand-collected data including dark web conversations in Russian, we conduct the first detailed anatomy of crypto-enabled cybercrimes and highlight relevant economic issues. Our analyses reveal that a few organized ransomware gangs dominate the space and have evolved into sophisticated firm-like operations with physical offices, franchising, and affiliation programs. Their techniques also have become more aggressive over time, entailing multiple layers of extortion and reputation management. Blanket restrictions on cryptocurrency usage may prove ineffective in tackling crypto-enabled cybercrime and hinder innovations. But blockchain transparency and digital footprints enable effective forensics for tracking, monitoring, and shutting down dominant cybercriminal organizations.Wigglesworth comments:
Perhaps. But while it is true that blockchain transparency might enable arduous but effective analysis of crypto-enabled cyber crime, reading this report it’s hard not to think that the transparency remedy is theoretical, but the costs are real.I have argued that the more "arduous but effective analysis" results in "tracking, monitoring, and shutting down" cybercriminals, the more they will use techniques such as privacy coins (Monero, Zcash) and mixers (Tornado Cash). Indeed, back in January Alexander Culafi reported that Ransomware actors increasingly demand payment in Monero:
In one example of this, DarkSide, the gang behind last year's Colonial Pipeline attack, accepted both Monero and Bitcoin but charged more for the latter because of traceability reasons. REvil, which gained prominence for last year's supply-chain attack against Kaseya, switched to accepting only Monero in 2021.Below the fold I discuss both Cong et al's paper, and Erin Plante's $30 Million Seized: How the Cryptocurrency Community Is Making It Difficult for North Korean Hackers To Profit, an account of Chainalysis' "arduous but effective" efforts to recover some of the loot from the Axie Infinity theft.