UK National Cyber Security Centre Lists Cryptojacking As “Significant” Threat

  • The UK's National Cyber Security Centre revealed cryptojacking is a cause for concern, and that it may become a legitimate source of income for website owners.
  • Cryptojacking has been growing in popularity among cybercriminals, and may affect a growing number of people in the next few years.

According to a report published by the UK’s National Cyber Security Centre (NCSC) this week, cryptojacking will be categorised as a form of cybercrime in the UK, as it is now seen as a “significant” cybersecurity concern. Per the organization, it’s likely going to “become a regular source of income for website owners.”

Cryptojacking essentially sees cybercriminals use other people’s computer resources to mine cryptocurrencies. Often, criminals mine privacy-centric cryptocurrencies like Monero (XMR), both to avoid detection and maximize profits mining with CPUs.

In the NCSC's comprehensive report, activities like cryptojacking, the use of cryptocurrency within targeted cybercrime, and ransomware were added as cause for concern. Unlike conventional currencies, cryptocurrencies like Monero offer anonymity to their users, cutting off potential trails leading to the criminals’ arrest.

Cryptojacking On The Rise

According to the report, cryptojacking cases have been increasing in number since 2016. Research conducted in December 2017 showed that 55% of businesses across the world have been infiltrated by cybercriminals looking to use their systems to mine.

By 2018/19, it's believed that cryptojacking will expand and affect a fast-growing number of people and businesses across the world. The report goes on to demonstrate that there are already 600 websites operating in the UK using visitor CPU resources to mine cryptocurrencies. The document reads:

"The technique of delivering cryptocurrency miners through malware has been used for several years, but it is likely in 2018-19 that one of the main threats will be a newer technique of mining cryptocurrency which exploits visitors to a website."

NCSC report

The report further notes that when being cryptojacked, users may only notice a “slight slowdown in performance,” meaning some cases go undetected. Although most cases involve cybercriminals using people’s resources without their consent, some websites ask for user consent as an alternative to showing ads.

The NCSC, at the end of the report, advised users to protect themselves with ad blockers and anti-malware programs that block cryptojacking scripts. A few browsers, including Opera and Brave, have built-in tools that block cryptocurrency miners.

Cybercrime in the UK has increased over the past few years; from WannaCry to present, with a growing number of crimes taking place in the UK. According to the Office of National Statistics, the volume of cybercrime has risen by 63% compared to last year.

The monetary cost of the rising cybercrime attacks has provoked action; the cabinet office reported that, without countermeasures, cybercrime would cost British businesses and taxpayers up to £27 billion (~$38 billion) annually.

Cryptocurrencies Are Now Exempt From Value-Added Tax in Country of Georgia

Michael LaVere
  • Country of Georgia has done away with value-added taxation on crypto-assets. 
  • First step in embracing bitcoin and crypto as a currency.

A new bill passed in the country of Georgia will make bitcoin and other crypto-assets exempt from the country’s value-added tax. 

No More VAT in Georgia

According to a report published on Bitcoin.com, the government of Georgia is taking a proactive approach in regulating crypto-asset taxation with a decision that will benefit decentralized currency users. A new bill signed by Georgia’s finance minister Ivane Matchavariani will make crypto-assets exempt from the value-added tax (VAT). 

VAT is a consumption tax placed on top of goods and services whenever value is added. Historically, VAT has been a source of contention and headache for cryptocurrency investors, particularly given the frequency of trading that can occur on most exchanges. The majority of users treat crypto-assets like currency, thereby exchanging them with traditional fiat when market conditions are favorable. 

However, a number of governments regulate crypto-assets like a commodity and are thereby able to impose taxes on value added during the exchange. 

While Europe is the birth-place of the value-added tax, its application to cryptocurrency has been varied. In Germany, crypto is treated as an investment, but capital gains are not imposed on assets held longer than a year. Estonia, on the other hand, does collect capital gains on the profit from crypto investing. 

Legitimizing Crypto

As the report points out, removing the VAT on crypto is one step forward in recognizing and legitimizing the technology as a currency. 

According to the new bill, 

“Cryptocurrencies are digital assets that are exchanged electronically and based on a decentralized network. Their exchange does not require a reliable intermediary and they are managed using distributed ledger technology.”

The report also states that, in addition to avoiding VAT, private citizens in Georgia trading cryptocurrencies will not have to pay income tax on their transactions.

Georgia has become a hotbed for cryptocurrency mining given the relatively cheap electricity provided through hydropower plants. However, the new bill does not apply to mining operations, who will still be forced to pay VAT on their earned coins unless registered abroad.  

While the Georgian government is removing one headache for crypto-asset investors, it still does not recognize bitcoin as legal tender in the country--nor any foreign fiat currency.