The BannerThe Future of Financial Cybercrime: Cryptocurrency and the Evolution of Digital Threats
By: Isabella Rivera, Emerson Aber, Dejonae Heath, Tyler Price, and Mariam Osman on April 15th, 2025.
Photos by Unsplash
The digital age of crime is upon us, and with that development comes endless ways for malicious actors to target corporations and individuals alike…
Our group is combining our individual research relating to cybercrime into one cohesive paper to discuss a major threat revolving around cryptocurrency.
Historically, money laundering, embezzlement, and fraud have been some of the most pervasive financial crimes. The rate at which these occur rapidly increased at the turn of the 21st century with the development of new technology and creative means of continuing these financial crimes in the cyber world. In recent years, there has been an immense expansion in the realm of cryptocurrencies. Cryptocurrencies are decentralized digital currencies that use encryption to secure transactions and can be transferred anonymously, often through blockchain technology. This makes them appealing to criminals who want to avoid detection. The recent technological advancements have allowed criminals to take to the ever-changing cyber world and find new ways to launder money, install ransomware, and commit other fraudulent financial activities like identity theft for their own personal gain. Analyzing where the current state of cyber financial crime stands and assessing the potential implications of psychology as an aid to both the offense and defense of cybercrime is imperative to keeping user information secure. A United States Senate Committee Report for Homeland Security & Governmental Affairs a couple years ago lets us in on the insight that “In recent years, ransomware attack victims have included hospitals, school systems, local, state, and federal government agencies, as well as other critical infrastructure, including the water and energy sectors. In 2021, ransomware attacks impacted at least 2,323 local governments, schools, and healthcare providers in the United States. According to the World Economic Forum, ransomware attacks increased by 435 percent in 2020 and ‘are outpacing societies’ ability to effectively prevent or respond to them.” As a cybercrime, ransomware attacks have been on a significant rise in recent years. The information provided in the report mentioned above goes on to mention that these numbers could be grossly underreported to the government sector, as private cybersecurity and blockchain sectors report many more cases of ransomware attacks and millions of dollars extorted from all kinds of citizens and agencies alike. Not only does ransomware affect businesses and law enforcement agents trying to trace the perpetrators, but it trickles all the way down to unassuming individuals who are not properly equipped with knowledge of ransomware and how it works. Institutions where an individual is likely to either already have a lot of money or owe a lot of money are ideal targets for hackers seeking to use ransomware. By exploiting these individuals, they are much more likely to pay without thinking of the consequences. Cryptocurrency is especially tricky to deal with once successfully paid out to the malicious attacker, because it becomes near impossible to trace if sent via a private blockchain network. In fact, individuals who have been victimized by a ransomware attack are at an increased risk of being retargeted within the same year, but businesses and agencies, specifically those in the education and healthcare sectors, show that about three-quarters of them are repeatedly victimized by ransomware attacks, with each attack increasing in amount of money demanded (Alder 2024).
Repeated victimization can also become an issue in regards to identity theft, as once your personal information is compromised it is extremely hard to get it all back securely. While ransomware is specifically designed to block access to something within a computer system until a monetary amount is paid, identity theft occurs when a malicious actor is using someone else’s personal information to commit fraud or make unauthorized purchases in their name. One of the methods that these cybercriminals utilize is the usage of malware to get access to the technological devices such as computers or phones of their unsuspecting victims so that the malware can be installed without being detected by the victim right away. By embedding this malware into an email that appears legitimate to the target, an unsuspecting victim will likely click on the link or attachment sent to them, causing the malware to be installed behind the scenes. Phishing scams are another common form of probe used by cybercriminals to gain information about a potential victim. They will pose as people or companies that the individual knows and send out an email or text requiring a response from the target in regards to giving up some personal information. It’s important to always double check who your emails are coming from and make sure they’re free of information that would raise any red flags. Similar to ransomware, the development of cryptocurrency is evolving how identity theft is accomplished at lightning speed. Once the attacker gains the information they need to access someones’ financial accounts, they can almost immediately transfer (or trade, as its called in the crypto world) this money into digital currency that becomes extremely hard to trace. Cryptocurrency uses multiple forms of encryption methods, as well as transfers across public and private keys. The anonymity of these trades make it difficult for law enforcement to trace, and even harder for the victim of identity theft to get their assets back.
As all of these developments and crime spikes unfold, it is important to take a step back and consider why they may be occurring. Social engineering is the term used when describing the different tactics employed by cybercriminals. At its core, social engineering is the constant adaptation of tactics from one victim to the next. After doing research on a potential victim, the cybercriminal will be able to gauge what sort of tactic may work best on them. High intelligence is among the most prominent traits seen in successful cybercriminals because it takes a lot of learning and developing to get an understanding of the types of cybercrimes they are carrying out. This is different from what’s seen in criminology as traditional criminals tend to have below average intelligence and commit blue collar crimes (Schiks, 2021).
Cybercriminals often are risk takers, though cybercrimes are less risky than a traditional crime like robbery, it is still done for the thrill. Taking risks and getting a benefit out of it, especially if it is a high reward, can instill a lot of confidence (Institute of Data). For certain cybercrimes involved in social engineering, they are required to be very manipulative. To do this they need to have an understanding of what type of victim they are looking for and how they want to go about exploiting them (Institute of Data). When cybercrimes are committed, the most commonly possessed skills of the attackers are related to the realm of information technology (IT), which allows them to exploit digital systems for malicious purposes. Understanding coding languages and knowledge of networking and system administration can help them navigate crimes like creating malware to use for identity theft or malicious tools like ransomware (Reynolds, 2024, p. 4). When someone knows network protocols it gives them insight into hacking and getting into sensitive information. Then on top of that knowledge, understanding cybersecurity principles gives them direct information into defensive measures set in place to protect from things like cyber attacks (Reynolds, 2024, p.4). By leveraging this knowledge, cybercriminals can identify vulnerabilities, manipulate security flaws and execute sophisticated attacks, making them formidable threats in the digital world.
The future of financial cybercrime will continue to evolve alongside emerging technologies. While cryptocurrency offers exciting possibilities for innovation, its misuse presents serious challenges for individuals, businesses, and governments alike. With social engineering tactics growing more sophisticated and digital currencies enabling anonymous transactions, addressing these threats requires a multidisciplinary approach—one that combines technology, psychology, policy, and public awareness. As our digital world expands, so must our defenses.
Resources
Alder, S. (2024, August 5). Almost three-quarters of ransomware victims hit multiple times. The HIPAA Journal.
https://www.hipaajournal.com/three-quarters-ransomware-victims-hit-multiple-times
Reynolds, A. L. (2024, April). Behavioral analysis and motivations behind cybercrime ODU Digital Commons.
Schiks, J. A. M., van de Weijer, S. G. A., & Leufeldt, E. R. (2021, August 18). High tech
crime, high intellectual crime? comparing the intellectual capabilities of cybercriminals,
traditional criminals and non-criminals. Computers in Human Behavior.
https://www.sciencedirect.com/science/article/pii/S0747563221003083
