Example of ransomware

Ransomware is a form of malware that hijacks the user’s computer and restricts access to most parts of it. For the restriction to be removed, the user must pay the malware creator a ransom. The malware might encrypt all the files on the computer, making them unaccessible, or simply lock down the computer and display annoying messages. Many times, ransomware will display official-looking messages claiming to be from law enforcement authorities to frighten the user into paying.

Seems legit? It’s not.

In the past, hackers demanded payment vouchers such as MoneyPak, but Bitcoin has become a much more attractive alternative since it is virtually impossible to trace. As a result, ransomware attacks have spiked more than 1000% in the past two and a half years, says McAfee. There were over 300,000 attacks in the last quarter alone.

In the United States, Swansea, a Massachusetts police department, had to pay $750 worth of Bitcoins to remove CryptoLocker from their computers.

While cybercriminals love Bitcoin, it is also gaining legitimacy. Ben Bernanke, chairman of the U.S. Federal Reserve did say that virtual currencies like Bitcoin have “long term promise”. I guess we’ll just have to wait and see.