European Banks Driving Bitcoin Boom As Brace Against Future Ransomware Attacks

European banks are stockpiling bitcoin as a hedge against ransomware attack, driving the virtual currency up 200 percent this year, The Street’s Jim Cramer said, quoting a panel talk with the CEO of Citrix Systems, Inc. CTXS.

“Bitcoin is what the bad guys demand you pay if you have a cybersecurity breach,” Cramer said. “The European banks...European companies are buying bitcoin to be ready for the next ransom attack.”

The “WannaCry” outbreak was unleashed on the world on May 12, when bitcoin was $1,697; It's now trading at $2,826.

Bitcoin Boom Mainly Coming In Europe, Hit Hardest By WannaCry

The worst attack of ransomware on record has largely abated -- at least until next time -- and there’s evidence only a relative handful of people or institutions paid up to have their data freed from the malware’s encrypted jail.

Among the computers affected worldwide were those integral to Britain’s National Health Service. A tech-savvy Samaritan found a fix that was widely deployed, but cyberattack experts warned that the next round of ransomware could be worse.

The link between the bitcoin boom and the WannaCry malware surfaced at The Deal's Corporate Governance Conference on Monday in New York, when Cramer spoke with Citrix CEO Kirill Tatarinov about the recent ransomware attacks.

Tatarinov said that companies are buying up bitcoin to pay off the hackers in the case of an attack.

”These cyber attackers have customer service desks,” to handle payment, Cramer said on CNBC. “They give you an 800 number.”

He said the digital currency could reach $1 million.

Experts generally warn against paying ransom.

“In general, any kind of extortion is problematic to pay. Not only does it encourage the people (who spread the worm) but there is no guarantee that they are going to return the data,” Eugene H. Spafford, executive director of Purdue University's Center for Education and Research in Information Assurance and Security, told Benzinga.

Related links:

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