Microsoft warns of the rise of cryware targeting hot wallets

Microsoft researchers warn of the rising threat of cryware targeting non-custodial cryptocurrency wallets, also known as hot wallets.

Microsoft warns of the rise of cryware, malicious software used to steal info an dfunds from non-custodial cryptocurrency wallets, also known as hot wallets. Data stolen from this kind of malware includes private keys, seed phrases, and wallet addresses, that could be used by threat actors to initiate fraudulent transactions.

“Cryware are information stealers that collect and exfiltrate data directly from non-custodial cryptocurrency wallets, also known as hot wallets. Because hot wallets, unlike custodial wallets, are stored locally on a device and provide easier access to cryptographic keys needed to perform transactions, more and more threats are targeting them.” reads the post published by Microsoft.

The experts pointed out that the theft of cryptocurrency is irreversible, unlike credit cards and other financial transactions there is no mechanism to reverse fraudulent transactions.

This cryware is automating the scanning process for hot wallet data exposed online.

The increasing popularity of cryptocurrency is attracting cybercrime that is using different means to target the cryptocurrency industry. Below is a list of threats that are currently leveraging cryptocurrency:

Cryptojackers. One of the threat types that surfaced and thrived since the introduction of cryptocurrency, cryptojackers are mining malware that hijacks and consumes a target’s device resources for the former’s gain and without the latter’s knowledge or consent. Based on our threat data, we saw millions of cryptojacker encounters in the last year.Ransomware. Some threat actors prefer cryptocurrency for ransom payments because it provides transaction anonymity, thus reducing the chances of being discovered.Password and info stealers. Apart from sign-in credentials, system information, and keystrokes, many info stealers are now adding hot wallet data to the list of information they search for and exfiltrate.ClipBanker trojans. Another type of info stealer, this malware checks the user’s clipboard and steals banking information or other sensitive data a user copies. ClipBanker trojans are also now expanding their monitoring to include cryptocurrency addresses.

Microsoft described the techniques used by crooks to steal hot wallet data, including clipping and switching, memory dumping, wallet file theft, phishing sites and fake applications, and keylogging.

Experts also warn of scams and other social engineering attacks that cybercriminals use to trick victims into sending funds to the attackers’ wallets.

Microsoft recommends users and organizations lock hot wallets when not actively trading, disconnect sites connected to the wallet, never store private keys in plaintext, ensure that browser sessions are terminated after every transaction, enable MFA for wallet authentication, double-check hot wallet transactions and approvals, use hardware wallets to store private keys offline.

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Pierluigi Paganini

(SecurityAffairs – hacking, Cryware)