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Increase in Ransomware Leading to Start-Up Company Specializing in the Technology Behind Bitcoin
POSTED MARCH 1, 2016
A special to USLAW NETWORK and USLAW DigiKnow
By Karen Painter Randall, Connell Foley LLP, Roseland, New Jersey
Digital Asset Holdings LLC, a start-up company specializing in the blockchain technology for the financial services industry recently announced that it has entered into business relationships with Accenture, Broadridge and PricewaterhouseCoopers to ensure faster adoption of its product. According to chief executive officer at Digital Asset Holdings, “These alliances will accelerate innovation, drive growth and broaden our reach in different segments across the world.”
Just this past week, a ransomware cyberattack on Hollywood Presbyterian Medical Center left its hospital systems affected and staff declaring an ‘internal emergency’. A few days later, the hospital announced that it had relented and paid the ransom demanded by extortionists of 40 bitcoins, or $17,000.
Bitcoins, or cryptocurrency is digital money, which is a virtual medium of exchange, not issued by, backed by, or tied to any particular nation or government. The blockchain, the underlying technology behind bitcoin, is a digital tool for recording and verifying transactions. The technology makes it easier to create cost-efficient business networks without requiring central control. In 2015, there was an explosion of interest in the bitcoin technology as a way to solve inefficiencies in financial markets. The partnerships show how the financial services industry is exploring the potential of the blockchain.
In particular, technology services provider Accenture will provide consulting and systems integration services – ranging from feasibility studies, business case assessments to operating model design – for clients through collaboration on blockchain-related work at global financial institutions. Broadridge will help identify, develop and drive adoption of business use cases of the blockchain, while PwC will help educate Digital Asset’s clients on its technology.
While Digital Asset’s plan is to use bitcoin as a way to solve financial inefficiency, this “currency” is also used in connection with illegal data bought and sold online. Moreover, bitcoins have become the payment of choice in connection with ransomware cyber-attacks because of the difficulty in tracing same. As a result, similar to other new technologies being developed, certain protocols will likely need to be implemented to regulate and control its proper use.