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Responsible Disclosure for Cryptocurrency Security

Stewart Baker discusses why the industry-norm responsible disclosure for software vulnerabilities fails for cryptocurrency software.

Why can’t the cryptocurrency industry solve the problem the way the software and hardware industries do, by patching and updating security as flaws are found? Two reasons: First, many customers don’t have an ongoing relationship with the hardware and software providers that protect their funds­—nor do they have an incentive to update security on a regular basis. Turning to a new security provider or using updated software creates risks; leaving everything the way it was feels safer. So users won’t be rushing to pay for and install new security patches.

Second, cryptocurrency is famously and deliberately decentralized, anonymized, and low friction. That means that the company responsible for hardware or software security may have no way to identify who used its product, or to get the patch to those users. It also means that many wallets with security flaws will be publicly accessible, protected only by an elaborate password. Once word of the flaw leaks, the password can be reverse engineered by anyone, and the legitimate owners are likely to find themselves in a race to move their assets before the thieves do. Even in the software industry, hackers routinely reverse engineer Microsoft’s patches to find the security flaws they fix and then try to exploit them before the patches have been fully installed.

He doesn’t have any good ideas to fix this. I don’t either. Just add it to the pile of blockchain’s many problems.

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Posted on September 9, 2022 at 8:33 AM • View Comments

Facebook Has No Idea What Data It Has

This is from a court deposition:

Facebook’s stonewalling has been revealing on its own, providing variations on the same theme: It has amassed so much data on so many billions of people and organized it so confusingly that full transparency is impossible on a technical level. In the March 2022 hearing, Zarashaw and Steven Elia, a software engineering manager, described Facebook as a data-processing apparatus so complex that it defies understanding from within. The hearing amounted to two high-ranking engineers at one of the most powerful and resource-flush engineering outfits in history describing their product as an unknowable machine.

The special master at times seemed in disbelief, as when he questioned the engineers over whether any documentation existed for a particular Facebook subsystem. “Someone must have a diagram that says this is where this data is stored,” he said, according to the transcript. Zarashaw responded: “We have a somewhat strange engineering culture compared to most where we don’t generate a lot of artifacts during the engineering process. Effectively the code is its own design document often.” He quickly added, “For what it’s worth, this is terrifying to me when I first joined as well.”

[…]

Facebook’s inability to comprehend its own functioning took the hearing up to the edge of the metaphysical. At one point, the court-appointed special master noted that the “Download Your Information” file provided to the suit’s plaintiffs must not have included everything the company had stored on those individuals because it appears to have no idea what it truly stores on anyone. Can it be that Facebook’s designated tool for comprehensively downloading your information might not actually download all your information? This, again, is outside the boundaries of knowledge.

“The solution to this is unfortunately exactly the work that was done to create the DYI file itself,” noted Zarashaw. “And the thing I struggle with here is in order to find gaps in what may not be in DYI file, you would by definition need to do even more work than was done to generate the DYI files in the first place.”

The systemic fogginess of Facebook’s data storage made answering even the most basic question futile. At another point, the special master asked how one could find out which systems actually contain user data that was created through machine inference.

“I don’t know,” answered Zarashaw. “It’s a rather difficult conundrum.”

I’m not surprised. These systems are so complex that no humans understand them anymore. That allows us to do things we couldn’t do otherwise, but it’s also a problem.

EDITED TO ADD: Another article.

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Posted on September 8, 2022 at 10:14 AM • View Comments

The LockBit Ransomware Gang Is Surprisingly Professional

This article makes LockBit sound like a legitimate organization:

The DDoS attack last weekend that put a temporary stop to leaking Entrust data was seen as an opportunity to explore the triple extortion tactic to apply more pressure on victims to pay a ransom.

LockBitSupp said that the ransomware operator is now looking to add DDoS as an extortion tactic on top of encrypting data and leaking it.

“I am looking for dudosers [DDoSers] in the team, most likely now we will attack targets and provide triple extortion, encryption + date leak + dudos, because I have felt the power of dudos and how it invigorates and makes life more interesting,” LockBitSupp wrote in a post on a hacker forum.

The gang also promised to share over torrent 300GB of data stolen from Entrust so “the whole world will know your secrets.”

LockBit’s spokesperson said that they would share the Entrust data leak privately with anyone that contacts them before making it available over torrent.

They’re expanding: locking people out of their data, publishing it if the victim doesn’t pay, and DDoSing their network as an additional incentive.

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Posted on September 7, 2022 at 9:26 AM • View Comments

Montenegro Is the Victim of a Cyberattack

Details are few, but Montenegro has suffered a cyberattack:

A combination of ransomware and distributed denial-of-service attacks, the onslaught disrupted government services and prompted the country’s electrical utility to switch to manual control.

[…]

But the attack against Montenegro’s infrastructure seemed more sustained and extensive, with targets including water supply systems, transportation services and online government services, among many others.

Government officials in the country of just over 600,000 people said certain government services remained temporarily disabled for security reasons and that the data of citizens and businesses were not endangered.

The Director of the Directorate for Information Security, Dusan Polovic, said 150 computers were infected with malware at a dozen state institutions and that the data of the Ministry of Public Administration was not permanently damaged. Polovic said some retail tax collection was affected.

Russia is being blamed, but I haven’t seen any evidence other than “they’re the obvious perpetrator.”

EDITED TO ADD (9/12): The Montenegro government is hedging on that Russia attribution. It seems to be a regular criminal ransomware attack. The Cuba Ransomware gang has Russian members, but that’s not the same thing as the government.

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Posted on September 2, 2022 at 8:18 AM • View Comments

High-School Graduation Prank Hack

This is a fun story, detailing the hack a group of high school students perpetrated against an Illinois school district, hacking 500 screens across a bunch of schools.

During the process, the group broke into the school’s IT systems; repurposed software used to monitor students’ computers; discovered a new vulnerability (and reported it); wrote their own scripts; secretly tested their system at night; and managed to avoid detection in the school’s network. Many of the techniques were not sophisticated, but they were pretty much all illegal.

It has a happy ending: no one was prosecuted.

A spokesperson for the D214 school district tells WIRED they can confirm the events in Duong’s blog post happened. They say the district does not condone hacking and the “incident highlights the importance of the extensive cybersecurity learning opportunities the District offers to students.”

“The District views this incident as a penetration test, and the students involved presented the data in a professional manner,” the spokesperson says, adding that its tech team has made changes to avoid anything similar happening again in the future.

The school also invited the students to a debrief, asking them to explain what they had done. “We were kind of scared at the idea of doing the debrief because we have to join a Zoom call, potentially with personally identifiable information,” Duong says. Eventually, he decided to use his real name, while other members created anonymous accounts. During the call, Duong says, they talked through the hack and he provided more details on ways the school could secure its system.

EDITED TO ADD (9/13): Here’s Minh Duong’s Defcon slides. You can see the table of contents of their report on page 59, and the school’s response on page 60.

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Posted on August 31, 2022 at 9:33 AM • View Comments

FTC Sues Data Broker

This is good news:

The Federal Trade Commission (FTC) has sued Kochava, a large location data provider, for allegedly selling data that the FTC says can track people at reproductive health clinics and places of worship, according to an announcement from the agency.

“Defendant’s violations are in connection with acquiring consumers’ precise geolocation data and selling the data in a format that allows entities to track the consumers’ movements to and from sensitive locations, including, among others, locations associated with medical care, reproductive health, religious worship, mental health temporary shelters, such as shelters for the homeless, domestic violence survivors, or other at risk populations, and addiction recovery,” the lawsuit reads.

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Posted on August 30, 2022 at 6:58 AM • View Comments

Levels of Assurance for DoD Microelectronics

The NSA has has published criteria for evaluating levels of assurance required for DoD microelectronics.

The introductory report in a DoD microelectronics series outlines the process for determining levels of hardware assurance for systems and custom microelectronic components, which include application-specific integrated circuits (ASICs), field programmable gate arrays (FPGAs) and other devices containing reprogrammable digital logic.

The levels of hardware assurance are determined by the national impact caused by failure or subversion of the top-level system and the criticality of the component to that top-level system. The guidance helps programs acquire a better understanding of their system and components so that they can effectively mitigate against threats.

The report was published last month, but I only just noticed it.

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Posted on August 29, 2022 at 9:30 AM • View Comments

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Sidebar photo of Bruce Schneier by Joe MacInnis.