Bitcoin drops steeply following FBI seizure of Colonial ransom

    Bitcoin falls again on Tuesday. The largest cryptocurrency continued to slip down all day among a massive selling out of digital currencies as investors were concerned about shifting U.S. monetary policy, continued tightening of crypto regulation in China, and doubts of the security of the cryptocurrency after the FBI had recovered most of the ransom paid to cybercriminals after a recent cyberattack on Colonial Pipeline.

    The cryptocurrency has plunged over 8 percent over the past 24 hours, according to Coindesk, and was trading below $33,000 on Tuesday afternoon.

    Other cryptocurrencies, like Ethereum and Dogecoin, also dropped around 8 percent or more.

    The value of Bitcoin has lost more than 40% over the last month after a bunch of bad news from China and the decision of Tesla CEO Elon Musk to stop accepting the cryptocoin as payment for cars.

    Before, U.S. officials reported Monday they have seized over $2.3 million paid in Bitcoin to DarkSide hacker gang. The funds were returned by a recently launched Washington task force created as part of the government’s response to growing cyberattacks.

    According to court documents, the Federal Bureau of Investigation was able to access the password for one of the hackers’ crypto wallets. Bitcoin has often been the favorite currency for hackers demanding ransom payments to decrypt the data locked by the “ransomware” attack.

    Crypto media portal Decrypt expressed doubts about the rumors that the attackers’ bitcoin wallet had been “hacked.”

    Reportedly, DarkSide received $90 million in bitcoin as ransom payments. It operated a so-called “ransomware as a service” business model, where the hackers group develops and markets ransomware tools and sells them to affiliates who attacks the targets.

    According to Elliptic, a blockchain analytics firm, seized funds represented a share of the DarkSide affiliate’s ransom paid by Colonial.

    Vice president of analysis at Mandiant Threat Intelligence John Hultquist greeted that move.

    “It has become clear that we need to use several tools to stem the tide of this serious problem, and even law enforcement agencies need to broaden their approach beyond building cases against criminals who may be beyond the grasp of the law,” he said.

    “In addition to the immediate benefits of this approach, a stronger focus on disruption may disincentivize this behavior, which is growing in a vicious cycle,” added Hultquist.

    Some analysts also pointing to the growing pressure from China government on crypto mining and trading, where several popular Weibo crypto-related accounts have been banned recently.

    Jehan Chu, a managing partner at crypto investment company Kenetic Capital from Hong Kong, said: “China continues to pressure crypto with rolling mining bans wiping out its most popular social media platform, Weibo, clean of crypto influencer accounts. This signals a tightening noose around crypto on the mainland.” “While long-term fundamentals remain intact, U.S. monetary and macroeconomic policy are causing short-term jitters,” the managing partner said. Chu added that investors have been giving away some of their investments in hopes of entering at lower points as U.S. monetary and fiscal policy grows clearer.

    Leave a Reply

    Your email address will not be published. Required fields are marked *