Cryptojacking (or “malicious cryptomining”) happens when the culprits hijack a third party’s network bandwidth without authorization to use for their cryptocurrency mining efforts. Their malicious software conceals itself on the electronic communication device and utilizes its resources. Obviously, the culprits engage in such clandestine activities to gain a profit or else they would spend their time and energy on other matters.
Cryptocurrencies are digital funds stored on electronic wallets (also known as “virtual wallets”) that are encrypted and exist on electronic communication devices. They are considered a new kind of digital assets. Coins are cryptocurrency units which are entered into a database for recording the transactions. The digital transaction takes place online between the virtual wallet owners and recorded on a public ledger. Then, special computers transform the digital transaction into a complicated mathematical puzzle, and thereafter miners independently solve and confirm the digital transaction. The reward for solving the mathematical puzzle is to receive a new cryptocoin. So, as time has progressed, the mining efforts have increased and caused a significant amount of money to be spent on the process. There are miners who have created “computer farms” and dedicated a vast amount of specialized hardware and software programs.
Unfortunately, in most cases, when you fall victim to cryptojacking it will go unnoticed. You may realize your electronic communication devices are slowing down or using too much bandwidth even though it’s not necessary. There are reports indicating the culprits have been detected on mobile devices, cloud servers, and critical datacenters. Now, some companies have been able to defend against cryptojacking by upgrading browsers and malware scanners. However, as always, the culprits will try to circumvent these defense mechanisms. For example, there is a report from an international cybersecurity firm confirming a cryptojacking campaign against a specific brand of routers. This attack exploited a flaw in the network routers and infected them. So, in short, the culprits used the flaw to promote their cryptojacking scheme.
What are the legal violations? Well, there could be a series of legal violations when this kind of activity takes place. For example, it is arguable that the culprits have committed the intentional tort of conversion. Conversion takes place when someone uses or alters another’s personal property without the owner’s knowledge or consent. It is also arguable that they have engaged in the unauthorized access to computers in violation of state and federal laws. In fact, there may be a cause of action for theft or larceny under Penal Code § 502.
It’s important to know your legal rights and responsibilities when it comes to cryptocurrencies and the related legal issues. Please contact our law firm to speak with a knowledgeable internet and technology attorney at your convenience.