Crypto Has Become a Currency Among Thieves

While I don't believe there is such a thing as "honor among thieves," we now have a currency among thieves.

Cryptocurrencies are growing in value, some investors have made money by investing in this volatile market. As of February 2, 2021, there are 8,378 cryptocurrencies with a market capitalization of $1 trillion dollars. Bitcoin alone still has 62.2 percent of the market cap of all cryptocurrencies.

Bitcoin's only rival is Ethereum. Together these two cryptocurrencies have almost 78% of the total market cap of cryptocurrencies.

For more than a century, Austrian School economists have opposed central banks for many reasons. They believe that the price of goods is subjective, and too complicated for bureaucrats, and even economists, to understand.

Another major argument against central banks is political. The Austrian School economists believe central bankers are not wise enough to use monetary policy to pick winners and losers in our economy by manipulating interest rates and exchange rates.

In his book Human Action, Austrian economist Ludwig von Mises argued:

"Credit expansion is the governments' foremost tool in their struggle against the market economy. In their hands it is the magic wand designed to conjure away the scarcity of capital goods, to lower the rate of interest or to abolish it altogether, to finance lavish government spending, to expropriate the capitalists, to contrive everlasting booms, and to make everybody prosperous."

It's understandable that cryptocurrency is popular among anyone opposed to crony capitalism. When the first digital cryptocurrency, Bitcoin, was created in 2008, the Federal Reserve used emergency measures such as quantitative easing. It's been over 12 years, and we still haven't returned to normal.

The Federal Reserve has become too powerful, and its monetary tools should be restricted to options that existed when Alan Greenspan was Fed Chairman. Cryptocurrency began as a noble goal, but now it has become a currency among thieves.

The growth in ransomware attacks has been fueled by cryptocurrency. When hackers demand a ransom, they are paid in the growing number of cryptocurrencies to evade the authorities.

In 2013, ransoms were in the hundreds of dollars. In 2020, we are starting to see ransoms in the millions of dollars.

In 2019, at least 966 American entities in government, health care, and education were victimized by ransomware attacks. This list includes at least 113 state and local governments, 764 healthcare providers, and 89 schools (colleges, universities, and school districts)

A few months ago, I had a chance to speak with Rob Cheng, who is founder of PC Matic. In the 1980s, the anti-virus industry created a blacklist of known viruses. With a blacklist, a person's data was protected from known malware, but it remained vulnerable to new threats.

PC Matic blocks known and unknown threats by inventing a whitelist. By limiting access to a list of trusted programs, this proactive approach limits both known and unknown viruses. In 2015, the National Institute of Standards and Technology (NIST) recommended that companies use whitelist technology to protect computer systems from malicious software.

Rob Cheng had two other ideas that could be helpful against ransomware attacks. The first idea involves password reform. Cheng told me that 50 percent of people never change the password to their personal email.

If a hacker wants to extort a company for ransom, he/she can hack into someone's personal email. Since many people use the same password for both home and work, hackers are going after someone's personal emails as a backdoor to hack into a company.

Cheng believes that employees should not choose their password. He believes companies should issue passwords for their employee's emails.

We also briefly discussed multi-factor authentication. Using a two-factor authentication is when someone receives a text message on his cell phone as a second step to access their email.

This added layer of security, makes it harder for a hacker. The hacker would need to have access to both your mobile phone and your email. Along with sending a code on a text message, there are now authentication apps as well.

The second idea is developing the equivalent of a flight data recorder for cybersecurity breaches. When an airplane crashes, a flight data recorder helps the authorities determine what caused the plane to crash.

The problem is that companies are often too embarrassed to cooperate. It is likely that their customers will lose confidence and the company's reputation could be shattered. While transparency can be helpful, it is understandable why people would rather pay the ransom.

I think we should take Rob Cheng's idea of whitelisting anti-virus software and apply it to cryptocurrencies. The problem is that cryptocurrencies have no incentive to cooperate with government and accept regulations, including a whitelist.

Former Trump advisor, and cryptocurrency proponent, Stephen Moore of the Heritage Foundation has written that the government has an incentive to regulate them out of existence. In 2019, Moore wrote, "Many political leaders believe the more they devalue their currency, the bigger advantage they will have in international trade. Cryptos are a check and balance against currency debauchery."

With trillions of dollars of government debt, Moore believes that politicians around the world could try to "inflate their way out of these debts." Cryptocurrencies have the potential to counter this problem.

We need the government to find a way to build trust with cryptocurrencies and solve this problem of ransomware attacks. One of the greatest bipartisan achievements in recent years was the creation of a federal cybersecurity agency in 2018.

The Congress passed, and President Trump signed, a bill which created the Cybersecurity and Infrastructure Security Agency (CISA). CISA should be placed in charge of working with the public and private sector, including cryptocurrency companies, to build the trust necessary to whitelist cryptocurrencies.

Robert Zapesochny is a researcher and writer whose work focuses on foreign affairs, national security and presidential history. His work has appeared in a range of publications, including The American Spectator, the Washington Times, and The American Conservative. For several years Robert worked closely with Peter Hannaford, a senior aide to Ronald Reagan, as the primary researcher on four books and numerous columns. Robert has also worked on multiple presidential, national and statewide campaigns, including as a field office staffer for the Bush-Cheney campaign. Due to his own Russian-Jewish heritage, Robert has a keen interest in the history of U.S.-Soviet relations. In 2017 he was the co-organizer of an effort that erected a commemorative statue of Ronald Reagan and Mikhail Gorbachev in Moscow. Robert graduated with a major in Political Science from the University at Buffalo, and received his Master's in Public Administration, with a focus in healthcare, from the State University of New York College at Brockport. When he's not writing, Robert works for a medical research company in Rochester, New York. Read Robert Zapesochny's Reports — More Here.