Bitcoin Companies Should Create a Cyber Security Standard Right Now

Bitcoin Companies Should Create a Cyber Security Standard Right Now

Companies and services being used on a daily basis are all suffering the same fatal flaw and critical mistake: they operate on technology the owners don’t fully understand. To put this into perspective, no one has to fully comprehend the technology they use on a daily basis to see the advantages it creates. But as a company or service provider, there is a responsibility to keep customer data safe from harm. Guaranteeing that type of protection is impossible without proper understanding of how everything works, and how it can be exploited.

Also Read: Android Security, Zero Day Vulnerability, and Bitcoin Key Protection

Cyber Security Remains a Problem Area

Cyber Security 2

As much as centralized services and companies are a plague in both the tech and Bitcoin industry, they still attract a lot of customers. Consumers are used to centralized services without giving it a second thought, as most things they do happen in the “cloud”. The “cloud” is just another centralized service, albeit there is the benefit of accessing files at any time, in any place and on any device.

But rest assured technology and Bitcoin companies are not the only one facing scrutiny in terms of online security. Insurance firms, the companies who are in control of other people’s government-issued money, are a high)value target for cyber attacks as of late. Such unwanted attention could not go by without notice, which is why the Bank of England will conduct a survey to check progress in the sector.

This is one of the major downsides of little technological innovation in the traditional financial sector over the past 50 years. All of the systems have remained the same while a handful of additional technological layers has been developed on top of existing infrastructure. Over the years, everything has become so intertwined that is is next to impossible to make sense of it all.

As a result, there are a lot of security vulnerabilities and weaknesses to be exploited by hackers. Even the most talented security experts have a hard time to keep up with developments in the cyber attack “sector”. Due to the adaptive nature of cyber attack threats, the financial industry needs to be able to adapt to any form of threat.

“In total, 97 percent of all participants reported [in 2012] that they discuss technology and cyber resilience during top management meetings. However, only around half of participants reported that they discuss these issues monthly or quarterly. Given the significant increase in cyber-attacks on financial firms since this survey was completed, we would expect that proportion to have increased in the ensuing period.”
– Bank of England 

To check whether or not any significant progress has been made by financial institutions, the Bank of England will conduct a survey of 28 multiple choice questions. Doing so will give valuable insights into the mindset of financial institutions, as well as how well educated their top management is and which measures will be taken to remain one step ahead of cyber attacks.

A Steep But Necessary Learning Curve

Learning CurveThere are quite a few parallels to be drawn between traditional financial institutions and Bitcoin service providers in terms of cyber security. Both markets have seen their fair share of breaches, hacks, and loss of customer funds, all of which have spurred on various security improvements over the past few years.

However, there is still a lot of room for improvement, both for Bitcoin companies and financial institutions. Cyber attacks are evolving at an accelerated pace, and despite best efforts by security experts, it is difficult for the “good guys” to keep up. This is why it is so important to conduct independent audits and allow for pen-testing security implementations.

After all, the purpose of black-hat hackers is to breach a system and play around with the possibilities. On the other hand, white-hat hackers are the best allies Bitcoin companies and financial institutions could wish for, as they can use the same toolset, yet will do so for the good of others. Rather than looking for personal financial gain, white-hat hackers can point out security flaws and help collaborate on solutions to fix these problems.

The learning curve for stepping up cyber security is long, steep, and very difficult.Then again, having to explain to customers why a Bitcoin platform or financial institution has been breached for the umpteenth time, is not an easy job either. There are only so many excuses to be used, and most of the times, the only real reason is negligence or lack of understanding the implemented technologies.

Bitcoin Companies To Lead By Example?

Bitcoin IndustryBoosting Bitcoin awareness in a positive manner has proven to be rather difficult these past few years, mostly because Bitcoin services and platforms are not as secure either. Should major companies and service providers unite for the cause of improving their cyber security, they would send a clear message to traditional financial institutions and attract a lot of positive media attention.

Especially considering the long string of Bitcoin companies being hacked or breached in recent years – or even earlier this year – cyber security is a key issue near and dear to the entire Bitcoin community. Instead of fighting amongst each other, and trying to gain an advantage over competitors, security precautions should form some sort of standard across the entire industry.

Given the recent interest by traditional financial companies to experiment with blockchain technology, there is no better time than now to showcase the cyber security standards employed by Bitcoin companies. Without the proper support from the community itself, such a standard is still far from being finalized, though.

What are your thoughts on creating a security standard for all bitcoin companies and services? Do you feel such a standard would put Bitcoin in a positive spotlight? Let us know in the comments below!

Source: Telegraph UK


Images courtesy of Cyber Security Specialist, Healthcare Informatics, 77 Arts Academy and WSJ