Will Bitcoins Spur Even More Online Lawlessness?

Much has already been written about the rise of a new digital currency, the Bitcoin. To some commentators, the Bitcoin is a new type of gold, representing the emergence of a borderless online world, free of annoying governmental interference and ridding the world of obsolete local currencies. To others, the Bitcoin represents just another bubble, or at worst, is the latest shift to a lawless, online "wild west."

But what is Bitcoin exactly? The Bitcoin is a digital currency based on an open source cryptographic protocol and not managed by any central governmental or financial authority. Bitcoins can be transferred through a computer or smartphone without any intermediate financial institution.

The value of a Bitcoin has fluctuated wildly, leading some to speculate that it is the conceptual equivalent of tulip bulbs in Holland in the seventeenth century, which witnessed the absurd valuation of the flowers' roots.

Apart from its sheer novelty, one part of the allure of the Bitcoin is that it can be used in transactions on the black market for all manner of contraband such as drugs and weapons. Another "benefit" to the Bitcoin is its ability to avoid governmental regulations. Consequently, it has become a hacker's dream come true.

Since each Bitcoin transaction is largely independent of any financial institution's intermediary involvement, it becomes difficult if not impossible for governments to restrict or regulate Bitcoin trade as they would traditional currency flow. 

Recently, the U.S. Financial Crimes Enforcement Network (FinCen) issued a formal statement clarifying the scope of various recordkeeping requirements in the Bank Secrecy Act to different types of Bitcoin transactions.

One relevant question raised by some Intellectual Property owners is to what extent an increase in online Bitcoin transactions will even further complicate current efforts to regulate online commerce.

The answer is uncertain. However, given the challenges already involved in ensuring international banking compliance comports with intellectual property rights, the Bitcoin promises only more headaches ahead.

Ironically, the Bitcoin itself is already reportedly being counterfeited, and hackers are stealing them from online "wallets," raising questions about how realistic expectations are that it could possibly function as an actual currency.

Hacking the Hackers

The Los Angeles Times reports on a new online security company called CrowdStrike founded by the former chief technology officer at McAfee Inc., George Kurtz.  Also joining CrowdStrike is the former head of the FBI's Cyber Crimes Division, Shawn Henry.

CrowdStrike is at the forefront of a novel business model for cybersecurity, one that identifies sophisticated foreign attackers trying to steal U.S. intellectual property and uses the attackers' own techniques and vulnerabilities to thwart them.  The firm is marketing itself as a private cyber intelligence agency, staking out networks to catch infiltrators, assembling dossiers on hackers and fooling intruders into stealing bogus data.

CrowdStrike, which employs Chinese linguists and former U.S. government agents, also has identified Chinese hackers using clues in their malware.   It then profiles them — complete with real names and photos — using information gathered from a variety of sources.

That has helped the company, for example, identify a Chinese hacker who targeted financial institutions and tends to seek merger and acquisition information.  Profiles enable a more targeted defense by helping CrowdStrike know when an attacker is likely to strike, how he communicates, what malware he uses and how he tries to take the stolen data.

Some experts believe CrowdStrike and other companies should be able to "hack back" by, for example, disabling servers that host cyber attacks, whether they are in the U.S. or abroad.  But this approach is not without critics, who worry how far companies might go down the road of cyber vigilantism.

The Justice Department has said hacking back may be illegal under the Computer Fraud and Abuse Act, a 1996 law that prohibits accessing a computer without authorization.  Many lawyers liken it to the principle that a person can't use "self-help" to legally break into his neighbor's house, even if he sees his stolen television in the neighbor's living room.

But what happens when the authorities themselves are unable, or unwilling, to cope with the threat that such hackers present?  

Critics worry that third party servers may be affected, or that attacks on Chinese or Russian-controlled computers could trigger an international incident.  What do you think?

Trademark for Hacker Group's Logo Triggers Declaration of Cyber War

Wired reports that a retail store in France had an idea that it may soon regret:  the store filed for a trademark for hacker group Anonymous' logo.

The retail store named Early Flicker, and the representative of that brand, Apollinaire Auffret, wants to own Anonymous' slogan, as well: "Anonymous. We are legion. We do not forgive. We do not forget. Expect us." in connection with commercial products. The store sells t-shirts on eBay France.

Representatives of the international hacker group produced a disturbing video stating:

Hello Citizens of the world, we are Anonymous.  Dear brothers and sisters, now is the time to open your eyes and expose the truth.  
Anonymous logo and slogan has been defiled and registered through the National Institute of Industrial Property (INPI).  An online t-shirt company called "Early Flicker" or "E-flicker" has registered the anonymous slogan and logo and passed it on as their own. Now under French law, the company owns the rights to the anonymous logo and slogan. The company's website is pickapop.fr.
  In a response the National Institute of Industrial Property said that "the conditions seem fulfilled since the mark is registered and it does not seem to have made use." Their arrogance and ignorance of what they have done will not go unpunished.  Anonymous will take down any business they have going on the internet and the 99 percent will not stop until the registration has been revoked and a public apology has been made.
  The name of Anonymous will not be the whore of the world.
  We are Anonymous. We are Legion. We do not forgive. We do not forget. Expect us.

The video depicts a representative of Anonymous in a Guy Fawkes mask speaking in a computer-generated voice.

The hacker group's threat is not likely to be an idle one.  In the past, Anonymous has targeted the US Department of Justice, the CIA, MasterCard and the Chinese government.