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Users report losing Bitcoin in clever hack of Electrum wallets

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A hacker (or hacker group) has made over 200 Bitcoin (circa $750,000 at today’s exchange) using a clever attack on the infrastructure of the Electrum Bitcoin wallet.

The attack resulted in legitimate Electrum wallet apps showing a message on users’ computers, urging them to download a malicious wallet update from an unauthorized GitHub repository.

The attack began last week on Friday, December 21, and appears to have been temporarily stopped earlier today after GitHub admins took down the hacker’s GitHub repository.

Also: Hacker steals 10 years worth of data from San Diego school district

Admins of the Electrum wallet expect a new attack to soon get underway, with either a new GitHub repo or a link to another download location altogether.

This is because the vulnerability at the heart of this attack has remained unpatched, albeit Electrum wallet admins taking steps to mitigate its usability for the attacker.

How the attack works:

  • Attacker added tens of malicious servers to the Electrum wallet network.
  • Users of legitimate Electrum wallets initiate a Bitcoin transaction.
  • If the transaction reaches one of the malicious servers, these servers reply with an error message that urges users to download a wallet app update from a malicious website (GitHub repo).
  • User clicks the link and downloads the malicious update.
  • When the user opens the malicious Electrum wallet, the app asks the user for a two-factor authentication (2FA) code. This is a red flag, as these 2FA codes are only requested before sending funds, and not at wallet startup.
  • The malicious Electrum wallet uses the 2FA code to steal the user’s funds and transfer them to the attacker’s Bitcoin addresses.

The problem here is that Electrum servers are allowed to trigger popups with custom text inside users’ wallets.

Initial attacks were more effective and seemed to have tricked more users because than latter attacks. This is because the Electrum wallet rendered these server messages as rich-formatted texts, making the popups look more authentic and providing a ready and clickable link to users.


Image: SoberNight

After receiving news of attacks, the Electrum team responded by silently updating the Electrum wallet app, so these messages don’t render as rich HTML text anymore.

electrum-error-message-no-html.png

Image: SoberNight

“We did not publicly disclose this [attack] until now, as around the time of the 3.3.2 release, the attacker stopped,” said SomberNight, a developer part of the Electrum wallet team. “However they now started the attack again.”

Not all users who received these new errors didn’t find the mysterious popup with mangled text fishy. Some users were more inconvenienced than alerted. These users manually copy-pasted the text link shown inside the popup into their browser, and then downloaded and installed the tainted Electrum wallet update.

The attack came to a halt a few hours ago when GitHub admins removed the repository containing the malicious wallet version.

As stated before, new attacks are expected to get underway, with possibly a new download link. But the issue here remains the attacker’s malicious servers.


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Devs are currently looking into replacing the ability to send customized error messages with error codes, which the Electrum wallet would then decode on the client-side and show a preset message instead.

SomberNight says Electrum devs have currently identified at least 33 malicious Electrum servers that have been added to their network, but the number appears to be around 40-50. It is unclear what devs intend to do in regards to these servers at the time being.

electrum-sybill-servers.png

Image:SoberNight

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GigaOm Radar for Security Orchestration, Automation, and Response (SOAR)

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Security Orchestration, Automation, and Response (SOAR) emerged as a product category in the mid-2010s. At that point, SOAR solutions were very much an automation and orchestration engine based on playbooks and integrations. Since then, the platforms have developed beyond the initial core SOAR capabilities to offer more holistic experiences to security analysts, with the aim of developing SOAR as the main workspace for practitioners.

Newer features offered by this holistic experience include case management, collaboration, simulations, threat enrichment, and visual correlations. Additionally, SOAR vendors have gradually implemented artificial intelligence (AI) and machine learning (ML) technologies to enable their platforms to learn from past events and fine-tune existing processes. This is where evolving threat categorization and autonomous improvement become differentiators in the space. While these two metrics are not critical for a SOAR platform, they may offer advantages in terms of reduced mean time to resolution (MTTR), resilience against employee turnover, and overall flexibility.

We’ve observed a lot of acquisition activity in the SOAR space. This was to be expected considering that, after 2015, a sizable number of pure-play SOAR vendors entered the market. Larger players with a wider security portfolio are acquiring these SOAR-specific vendors in order to enter the automation and orchestration market. We expect to see more SOAR acquisitions as the security tools converge, very likely into next-generation Security Information & Event Management products and services (SIEMs).

SIEM is a great candidate for a central management platform for security activities. It was designed to be a single source of truth, an aggregator of multiple security logs, but has been limited historically in its ability to carry out actions. In the past few years, however, SIEMs have either started developing their own automation and orchestration engines or integrated with third-party SOAR vendors. Through a number of acquisitions and developments, multiple players with wider security portfolios have begun to offer SOAR capabilities natively as part of other security solutions.

Going forward, we expect SOAR solutions to be further integrated into other products. This will include not only SIEM, but also solutions such as Extended Detection and Response (XDR) and IT automation. The number of pure-play SOAR vendors is unlikely to increase, although a handful may remain as fully agnostic solutions that enterprises can leverage in instances when their existing next-generation SIEM platforms do not meet all their use cases. However, for pure-play SOAR vendors to remain competitive, they will need to either expand into other security areas or consistently outperform their integrated counterparts.

How to Read this Report

This GigaOm report is one of a series of documents that helps IT organizations assess competing solutions in the context of well-defined features and criteria. For a fuller understanding consider reviewing the following reports:

Key Criteria report: A detailed market sector analysis that assesses the impact that key product features and criteria have on top-line solution characteristics—such as scalability, performance, and TCO—that drive purchase decisions.

GigaOm Radar report: A forward-looking analysis that plots the relative value and progression of vendor solutions along multiple axes based on strategy and execution. The Radar report includes a breakdown of each vendor’s offering in the sector.

Solution Profile: An in-depth vendor analysis that builds on the framework developed in the Key Criteria and Radar reports to assess a company’s engagement within a technology sector. This analysis includes forward-looking guidance around both strategy and product.

The post GigaOm Radar for Security Orchestration, Automation, and Response (SOAR) appeared first on Gigaom.

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GigaOm Radar for Disaster Recovery as a Service (DRaaS)

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Very few organizations see disaster recovery (DR) for their IT systems as a business differentiator, so they often prefer to outsource the process and consume it as a service (DRaaS) that’s billed monthly. There are many DRaaS providers with varying backgrounds, whose services are often shaped by that background. Products that started as customer-managed DR applications tend to have the most mature orchestration and automation, but vendors may face challenges transforming their application into a consumable service. Backup as a Service (BaaS) providers typically have great consumption models and off-site data protection, but they might be lacking in rich orchestration for failover. Other DRaaS providers come from IaaS backgrounds, with well-developed, on-demand resource deployment for recovery and often a broader platform with automation capabilities.

Before you invest in a DRaaS solution, you should attempt to be clear on what you see as its value. If your motivation is simply not to operate a recovery site, you probably want a service that uses technology similar to what you’re using at the protected site. If the objective is to spend less effort on DR protection, you will be less concerned about similarity and more with simplicity. And if you want to enable regular and granular testing of application recovery with on-demand resources, advanced failover automation and sandboxing will be vital features.

Be clear as well on the scale of disaster you are protecting against. On-premises recovery will protect against shared component failure in your data center. A DRaaS location in the same city will allow a lower RPO and provide lower latency after failover, but might be affected by the same disaster as your on-premises data center. A more distant DR location would be immune to your local disaster, but what about the rest of your business? It doesn’t help to have operational IT in another city if your only factory is under six feet of water.

DR services are designed to protect enterprise application architectures that are centered on VMs with persistent data and configuration. A lift-and-shift cloud adoption strategy leads to enterprise applications in the cloud, requiring cloud-to-cloud DR that is very similar to DRaaS from on-premises. Keep in mind, however, that cloud-native applications have different DR requirements.

How to Read this Report

This GigaOm report is one of a series of documents that helps IT organizations assess competing solutions in the context of well-defined features and criteria. For a fuller understanding consider reviewing the following reports:

Key Criteria report: A detailed market sector analysis that assesses the impact that key product features and criteria have on top-line solution characteristics—such as scalability, performance, and TCO—that drive purchase decisions.

GigaOm Radar report: A forward-looking analysis that plots the relative value and progression of vendor solutions along multiple axes based on strategy and execution. The Radar report includes a breakdown of each vendor’s offering in the sector.

Solution Profile: An in-depth vendor analysis that builds on the framework developed in the Key Criteria and Radar reports to assess a company’s engagement within a technology sector. This analysis includes forward-looking guidance around both strategy and product.

The post GigaOm Radar for Disaster Recovery as a Service (DRaaS) appeared first on Gigaom.

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GigaOm Radar for DDoS Protection

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With ransomware getting all the news coverage when it comes to internet threats, it is easy to lose sight of distributed denial of service (DDoS) attacks even as these attacks become more frequent and aggressive. In fact, the two threats have recently been combined in a DDoS ransom attack, in which a company is hit with a DDoS and then a ransom demanded in exchange for not launching a larger DDoS. Clearly, a solid mechanism for thwarting such attacks is needed, and that is exactly what a good DDoS protection product will include. This will allow users, both staff and customers, to access their applications with no indication that a DDoS attack is underway. To achieve this, the DDoS protection product needs to know about your applications and, most importantly, have the capability to absorb the massive bandwidth generated by botnet attacks.

All the DDoS protection vendors we evaluated have a cloud-service element in their products. The scale-out nature of cloud platforms is the right response to the scale-out nature of DDoS attacks using botnets, thousands of compromised computers, and/or embedded devices. A DDoS protection network that is larger, faster, and more distributed will defend better against larger DDoS attacks.

Two public cloud platforms we review have their own DDoS protection, both providing it for applications running on their public cloud and offering only cloud-based protection. We also look at two content delivery networks (CDNs) that offer only cloud-based protection but also have a large network of locations for distributed protection. Many of the other vendors offer both on-premises and cloud-based services that are integrated to provide unified protection against the various attack vectors that target the network and application layers.

Some of the vendors have been protecting applications since the early days of the commercial internet. These vendors tend to have products with strong on-premises protection and integration with a web application firewall or application delivery capabilities. These companies may not have developed their cloud-based protections as fully as the born-in-the-cloud DDoS vendors.

In the end, you need a DDoS protection platform equal to the DDoS threat that faces your business, keeping in mind that such threats are on the rise.

How to Read this Report

This GigaOm report is one of a series of documents that helps IT organizations assess competing solutions in the context of well-defined features and criteria. For a fuller understanding consider reviewing the following reports:

Key Criteria report: A detailed market sector analysis that assesses the impact that key product features and criteria have on top-line solution characteristics—such as scalability, performance, and TCO—that drive purchase decisions.

GigaOm Radar report: A forward-looking analysis that plots the relative value and progression of vendor solutions along multiple axes based on strategy and execution. The Radar report includes a breakdown of each vendor’s offering in the sector.

Solution Profile: An in-depth vendor analysis that builds on the framework developed in the Key Criteria and Radar reports to assess a company’s engagement within a technology sector. This analysis includes forward-looking guidance around both strategy and product.

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