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US National Lab Computer Scientists Deploy Artificial Intelligence (AI) to Thwart Illegal Crypto Mining

Computer scientists at Los Alamos National Laboratory have created an innovative artificial intelligence (AI) system capable of identifying malicious codes that prompt supercomputers to mine cryptocurrencies like Monero and Bitcoin.

The lab operating under the United States Department of Energy hopes to put an end to cryptocurrency cybercrime.

Software-based watchdog

Hackers are continuously wreaking havoc globally, and the crypto mining arena hasn’t been spared. Gopinath Chennupati, a researcher at Los Alamos National Laboratory, noted that the deep learning AI model will be instrumental in detecting supercomputer hacks that usually instigate cryptocurrency mining. Speaking on behalf of his team’s AI project designed to combat illegal crypto mining on the internet, Chennupati said:

“Based on recent computer break-ins in Europe and elsewhere, this type of software watchdog will soon be crucial to prevent cryptocurrency miners from hacking into high-performance computing facilities and stealing precious computing resources.”

Valid cryptocurrency miners usually assemble vast computer arrays needed to dig up digital assets. Nevertheless, crafty ones usually manipulate supercomputers by making sure that their tracks are hidden.

The new artificial intelligence algorithm is coded in such a way that it can detect crypto miners who steal computing power from research supercomputers.

AI-centered analysis

The researchers gave the system the green-light after comparing an invasive Bitcoin (BTC) mining code with a known benign code.

The AI analysis provided by the lab researchers at Los Alamos National Laboratory was more reliable and faster than conventional ones because the AI algorithm is based on graph comparisons. As a result, it cannot be fooled by common methods employed by illegal crypto miners to conceal their illicit activities on the web. These strategies include the release of obfuscated comments and variables used to disguise the codes as legitimate programming.

The system, therefore, seeks to avert the illicit cryptocurrency mining headache by identifying any foul play.

Cybercrime in a rising digital world

Cybercrime is on the rise, and alternatives such as artificial intelligence are being continuously researched during these times to regulate cybercrime.

Earlier this month, Federal authorities unraveled a huge illegal Bitcoin mining farm in Kyrgyzstan operated by government officials.

Another instance of illicit activities that are Bitcoin-driven is the illegal BTC mining activities that were uncovered by Chinese police in June. Scammers operated by digging two graves for the purpose of driving forward their illegal mining operations and were stealing electricity from a Chinese oil field company.

Brock Pierce's Presidential Campaign Enlists Akon as Chief Strategist

Crypto entrepreneur and world-famous R&B and hip-hop singer Akon has announced that he will be endorsing Brock Pierce’s presidential election campaign and joining the crypto venture capitalist’s campaign team.

The Grammy-nominated artist is enthusiastic about this new partnership and will be serving as the chief strategist for Pierce’s campaign this election year. US Presidential election day is to be held on Tuesday, November 3 this year.

Brock Pierce for President

Brock Pierce’s announcement to run for president means big things for the crypto industry, as the former child star is a prominent influence in the world of technology and cryptocurrency. Being a huge entrepreneur himself, Brock Pierce has a track record of building companies up from scratch. In 2018, the former actor of Disney film “The Mighty Ducks” even made it onto Forbes list for wealthiest crypto investors in the world. According to a report by J.D. Durkin, the Bitcoin (BTC) billionaire disclosed his intentions behind running for president, during his campaign announcement:

“Entrepreneurs are essential to the rebuilding of this nation that we love, and I’m running in this race because I know that together we can help build a pathway towards the rebirth of the America we love so much.”

Brittany Kaiser, known for being the official whistleblower behind the Cambridge Analytica scandal of Facebook that erupted and helped the Trump campaign in 2016, touted Brock Pierce’s horn and said that it was “a breath of fresh air to have someone who has spent their life really understanding technology” running for President of the United States. A strong blockchain advocate, Kaiser vouched for Pierce and said that the crypto entrepreneur not only understood how to improve systems to make them more effective, but he also had a unique vision for creating a more inclusive, wholesome political platform.

Crypto Entrepreneur Akon to Build Akon City

Both Brock Pierce and Akon are happy to be collaborating for the crypto venture capitalist’s Presidential election run.

Akon, a huge crypto entrepreneur himself who is currently working on a massive crypto project in Senegal, seems to be the perfect chief strategist for Pierce, as they both have similar visions for crypto’s future. The Grammy-nominated singer and crypto philanthropist has been actively building a futuristic crypto city in Senegal. The crypto-run city, dubbed “Akon City” is to run on its full-fledged official cryptocurrency Akoin, as per the whitepaper released by Akon. Akon City will include a mall, a complex, a police station, residential units, hotels, a police station, a hospital campus, and more.

‘I Have a Dream’ – Akon and Brock Pierce

The addition of Akon to Pierce’s presidential campaign run may mean huge things for the cryptocurrency industry, as the spotlight will most definitely shine on digital assets and the benefits of blockchain for the advancement of world economy.

In speaking about his newly appointed position as chief strategist for Brock Pierce, Akon affirmed that Brock Pierce is a “real people’s person and he doesn’t operate between party lines.” He also said that both Pierce and he had the “same dream of pushing America forward for everyone without showing favoritism to one particular base.”

US Files Lawsuit to Recover Cryptocurrency Accounts Linked to North Korean Hacking Operation

The US Department of Justice has filed a suit against North Korean state-sponsored cyber hackers for allegedly perpetrating two major cryptocurrency heists.

Crypto exchanges suffer North Korean cyber attack

The complaint, filed on Thursday, outlined two hacks that were allegedly conducted by state-sponsored North Korean cybercriminals, and that targeted two cryptocurrency exchanges hit last year. Proton Tokens (PTT), PlayGame tokens (PXG), and IHT Real Estate Protocol tokens were stolen from the first virtual exchange. In order to launder the digital assets, cyber hackers washed out the tokens through Chinese over-the-counter brokers.

The altcoin assets were converted into Bitcoin (BTC), Tether (USDT), and other cryptocurrencies to cover the North Korean cyber criminals’ tracks. The total amount of altcoins and tokens stolen were reported to be equivalent to $272,000.

A similar case was reported by US investigators a few months after the occurrence of the first crypto heist. This time, a US crypto exchange was hacked and $2.5 million in cryptocurrencies were stolen. Once again, US law enforcement said that North Korean operators laundered the virtual funds through Chinese traders that they had coordinated with for previous heists.

Despite the crypto laundering techniques that were employed by North Korean cyber hackers, law enforcement and cybersecurity were able to trace the funds, thanks to blockchain analysis. The stolen cryptocurrency assets were allegedly funneled into 280 cryptocurrency accounts.

In relation to the civil forfeiture complaint filed by US Justice Department, FBI Special Agent Emmerson Buie Jr. spoke up regarding cybersecurity and North Korea’s alleged involvement in cyberattacks. He said:

“Today’s complaint demonstrates that North Korean actors cannot hide their crimes within the anonymity of the internet. International cryptocurrency laundering schemes undermine the integrity of our financial systems at a global level, and we will use every tool in our arsenal to investigate and disrupt these crimes.”

US investigates North Korean cyber operations

In order to tighten cybersecurity and annihilate any national security threat, the US has been actively monitoring North Korean tactics. In a recent tactical report released in July, the US Army had revealed that North Korea currently had more than 6,000 hackers operating under their umbrella. These government-sponsored hackers were dispersed throughout the world and were rumored to be at the basis of illicit cyber hacks.

There is substantial evidence that indicates that the Democratic People’s Republic of Korea (DPRK) may be heavily involved in cybercriminal operations, and US officials have clearly expressed their desire to safeguard national security by tightening cybersecurity ropes.

In the past, two Chinese nationals, Tian YinYin and Li Jiadong, had been sanctioned by the US government for their involvement in laundering over $100 million worth of Bitcoin cryptocurrency funds from a 2018 cyberattack perpetrated by North Korean hackers against a crypto exchange. The two men were identified for their connection to the notorious North Korean state-sponsored cybercriminal ring, Lazarus Group.

Foundry Ranks as the 2nd Largest BTC Mining Pool Globally

Foundry, an American-based crypto mining pool has climbed up the rankings and is now the second-largest Bitcoin mining pool after AntPool.

Foundry’s rise to the top spot was seen after the Digital Currency Group-owned outfit staked up as much as 14.79% of the total market share.

The crackdown on digital currency-related activities in China has provided new growth opportunities for American cryptocurrency-focused startups. While the majority of China’s exiled Bitcoin miners swarmed to the United States and other crypto safe-havens, American-affiliated industry stakeholders have been increasing their operational funding to capture the market that is slipping away from China.

The trend is paying off with Foundry who according to BTC.com contributes exactly 24385.20 PH/s hash rate at the time of writing. Foundry’s position in the market was established in part with its competitive payout rate per block. At a $5,500 earning rate per block, Foundry comes off as the highest paying pool amongst the top 5 profiled by BTC.com.

“We redistribute the block reward to miners via a Full-Pay-Per-Share (FPPS) payout scheme, and our pool fees are actually 0%,” said Kevin Zhang, Vice President of Foundry USA.

Foundry is particularly bound to gain extra advantages in terms of funding for its operations from its parent company, the Digital Currency Group. As reported by Blockchain.news last week, the blockchain investment giant secured a $600 million credit facility, succeeding a number of funding rounds this year. This amount, the firm confirmed, will be used to bankroll its subsidiaries, Foundry inclusive, with the sole aim of capturing more market share.

America now also ranks as the biggest hub for institutional investors, as more Wall Street Firms are keeping digital currencies on their balance sheet. While China’s hostile nature towards decentralized digital currency is damning for homegrown crypto entities, it is creating a new opportunity for others, particularly US-based firms.

Fed report examines CBDC compensation and convenience

The Federal Reserve Board of the United States, in a report that was made public on November 17th, stressed the significance of compensation in relation to the development of a digital currency issued by the central bank (CBDC). The theoretical literature on CBDCs in large, industrialized nations, with a primary focus on the United States, is investigated in this essay that is part of the Finance and Economics Discussion Series published by the Federal Reserve. It investigates the potential benefits and drawbacks of instituting a CBDC for the banking system, with a special emphasis on the crucial function that CBDC design plays in the execution of monetary policy and compensation (interest payments).

The authors come to the conclusion that a CBDC may help in the management of the Fed’s balance sheet by making the holding of CBDCs more or less attractive in comparison to bonds, and that the establishment of such a CBDC may also help in the control of bank disintermediation. According to the authors, “remuneration is without a doubt the key design aspect that any central bank would desire to study.” The following is what they then state:

Because CBDCs do not accrue interest, their only purpose is to act as a medium of exchange, and their value is almost completely predicated on their acceptability as a means of payment. In contrast, the rate of compensation for a CBDC might be used as a tool for policy in addition to making the CBDC more appealing as a vehicle for wealth accumulation. This would be in addition to the goal of making the CBDC more desirable.

Either proportional interest that is reported as a percentage or tiered interest that increases or decreases in a nonlinear reaction to the value of a holding may be used as a policy instrument. Tiered interest is more common.

SEC panel votes in favor of proposal that may make it more difficult

By a vote of 4-1, a panel of the United States Securities and Exchange Commission (SEC) decided to approve a proposal that, if implemented, would make it more difficult for companies that deal in cryptocurrencies to act as custodians of digital assets in the future. This proposal could make it more difficult for companies to act as custodians of digital assets. There were five people on the panel altogether.

According to a statement that was issued by SEC Chairman Gary Gensler on February 15, the proposal, which has not yet been officially approved by the SEC, recommends amendments to the “2009 Custody Rule” that will apply to custodians of “all assets,” including cryptocurrencies. This rule will apply to custodians of “all assets,” including cryptocurrencies, according to the statement. The “2009 Custody Rule” would be updated to include these modifications.

According to Gensler, at the current moment there are a number of cryptocurrency trading platforms that are not in reality “qualified custodians” despite the fact that they are promoting the provision of custody services.

According to the Securities and Exchange Commission (SEC), a qualified custodian is typically a bank or savings association that is federally or state-chartered, a trust company, a registered broker-dealer, a registered futures commission merchant, or a financial institution that is located outside of the United States. In addition, a qualified custodian must be able to demonstrate that it meets the requirements of the SEC.

These custodians will be required to jump through additional hoops such as annual audits from public accountants, among other transparency measures, as part of the newly proposed rules. In addition, U.S. and offshore companies will be required to ensure that all custodied assets, including cryptocurrencies, are properly segregated in order to become a “qualified custodian.” These new rules were proposed by the Financial Stability Oversight Council (FSOC). To achieve the status of “certified custodian,” businesses based in the United States or abroad would further be required to guarantee the safety of any assets under their care.

SEC Agrees to Delay Terraform Labs Trial, Awaiting Do Kwon's Extradition

The United States Securities and Exchange Commission (SEC) has consented to postpone the trial of Terraform Labs and its co-founder, Do Kwon, pending Kwon’s extradition. This follows a filing by the SEC on January 15, 2024, in the U.S. District Court for the Southern District of New York. The trial, originally scheduled to commence on January 29, is now proposed to start no earlier than March 18, 2024.

Kwon, currently in Montenegro following his arrest in March 2023, is facing charges for allegedly orchestrating a $40 billion cryptocurrency fraud. The SEC, fully prepared to proceed with the trial, joined Kwon’s legal team in requesting the adjournment to ensure his participation in the trial. The Terraform Labs co-founder’s legal team, dealing with the complexities of extradition, suggested that Kwon could be in the United States by mid-March. If the trial is postponed, the SEC has requested that it commence on April 15, 2024.

The allegations against Terraform Labs and Kwon stem from the collapse of TerraUSD, a stablecoin designed to maintain a constant $1 price, and Luna, a closely linked token. Both cryptocurrencies suffered a catastrophic loss in May 2022 when TerraUSD failed to maintain its peg, leading to a market loss of $40 billion or more. This event marked a significant downturn in the crypto market that year and had far-reaching implications in the industry.

Furthermore, Terraform Labs and Kwon are accused of misleading investors about the stability of TerraUSD and its usage in a popular Korean mobile payment app. In addition to the SEC’s civil case, Kwon also faces criminal charges in the U.S. and an extradition request from South Korea. The outcome of this trial could significantly impact the regulatory landscape of cryptocurrencies, given the scale of the alleged fraud and the involvement of multiple international jurisdictions.