BitGo quietly launches dynamic fraud filtering service
Palo Alto based bitcoin startup BitGo said that they have quietly launched a dynamic fraud filtering service within their wallet earlier this year.
As part of the announcement from BitGo co-founder and CEO Mike Belshe, BitGo has already saved one customer more than $10,000 USD (over 18 BTC) using the fraud filters.
BitGo is one of the first multisignature wallets to hit the market which they use to keep bitcoin secure from theft and loss. The company also provides an enterprise suite of services for bitcoin portfolio management, corporate treasury, and enterprise enablement.
The majority of bitcoin wallets have a single private key, which means they are more susceptible to a loss of funds if the single key is stolen. BitGo takes advantage of multisig to issue wallet users with three keys, two of which are required to send bitcoin (2-of-3). BitGo also holds one key, which is stored offline as backup. Using a set of user-defined criteria, the wallet transactions are co-signed when the criteria is met.
Malware is a specific use-case where bitcoin users are the most susceptible to key-loss. This newer type of malware takes over the infected computer’s clipboard, and replaces bitcoin addresses as they’re copy and pasted.
Trojan.Coinbitclip is the first instance of this new type of attack, discovered by Symantec in February. It was designed to watch for a bitcoin address copied using the clipboard, and replaces it with one of it’s own. However, Belshe says that BitGo’s new dynamic fraud filtering service is able to block such malware.
“BitGo will not co-sign requests that appear to be fraudulent and will instead report an error to the user,” wrote Belshe.
The new fraud checks are applicable to the wallet as well as the BitGo API, which should aid to against loss and theft. Typically to protect completely against malware, bitcoin users have had to resort to using hardware wallets, which are secured offline against such attacks.
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