Bitcoin breach highlights need for cybersecurity fortifications

January 9, 2015

Cybersecurity continues to be the biggest impediment against the growth of cloud computing. While businesses across the globe are adopting the technology and immersing it into their daily routine, many others are hesitating because they fear security breaches. The recent cyberattack against Sony Pictures certainly caught the attention of IT managers and tech engineers. It also may have decelerated the growth trajectory of cloud computing among the general public.

Data breaches once again made headlines at the beginning of 2015 because of an attack on bitcoin. USA Today reported that BitStamp, the third largest bitcoin exchange company in the world, recently announced that it has lost $5.4 million worth of the currency to a security hack. This news further affirms the goal ahead for tech engineers of both cloud computing and bitcoin. They must find better ways to establish security measures for important cyber-data.

BitStamp aims to offset losses
In response to the security breach news, BitStamp said that the lost amount represents just a small portion of the company’s bitcoin reserve, according to USA Today. Even so, the attack comes at a difficult time for the cyber currency. Some traders have called bitcoin the worst investment of 2014.

Despite the widespread criticism, Steve Lord, founder of Modern Money Group, told the news source that BitStamp will be just fine in the aftermath of the breach.

“[BitStamp] got hit but it looks like they will be able to survive the hit,” Lord told USA Today. “I would never characterize this as immaterial, but I certainly don’t think it’s the death knell you are reading about.”

Nonetheless, the news signals the need for greater cybersecurity technology for the cloud and bitcoin alike.

The root of the security problem
A number of tech professionals have criticized cloud users for their reactive tendencies. Only after a breach do they consider greater security measures. The same could be said for the bitcoin breach.

“An attack happens and they plug it,” Andre Durand, CEO at Ping Identity, told TechCrunch. “They don’t invest proactively to stop a class of threats in a fundamental manner. It’s not like they don’t try to aggregate threats and think ahead. They do, but by and large, they respond like an immune system. Nothing happens until a virus comes in and they address it.”

The bitcoin news serves as a good example of how cybersecurity measures still have room to improve. The proliferation of both the cloud and bitcoin will depend on greater security strategies.