German researchers have discovered unknown persons are using bitcoin's blockchain to store and link to child abuse imagery, potentially putting the cryptocurrency in jeopardy. From a report: The blockchain is the open-source, distributed ledger that records every bitcoin transaction, but can also store small bits of non-financial data. This data is typically notes about the trade of bitcoin, recording what it was for or other metadata. But it can also be used to store links and files. Researchers from the RWTH Aachen University, Germany found that around 1,600 files were currently stored in bitcoin's blockchain. Of the files least eight were of sexual content, including one thought to be an image of child abuse and two that contain 274 links to child abuse content, 142 of which link to dark web services. "Our analysis shows that certain content, eg, illegal pornography, can render the mere possession of a blockchain illegal," the researchers wrote. "Although court rulings do not yet exist, legislative texts from countries such as Germany, the UK, or the USA suggest that illegal content such as [child abuse imagery] can make the blockchain illegal to possess for all users. This especially endangers the multi-billion dollar markets powering cryptocurrencies such as bitcoin."
A 15-year-old security researcher has discovered a serious flaw in cryptocurrency hardware wallets made by Ledger, a French company whose popular products are designed to physically safeguard public and private keys used to receive or spend the user’s cryptocurrencies.
Hardware wallets like those sold by Ledger are designed to protect the user’s private keys from malicious software that might try to harvest those credentials from the user’s computer. The devices enable transactions via a connection to a USB port on the user’s computer, but they don’t reveal the private key to the PC.
Yet Saleem Rashid, a 15-year-old security researcher from the United Kingdom, discovered a way to acquire the private keys from Ledger devices. Rashid’s method requires an attacker to have physical access to the device, and normally such hacks would be unremarkable because they fall under the #1 rule of security — namely, if an attacker has physical access to your device, then it is not your device anymore.
The trouble is that consumer demand for Ledger’s products has frequently outpaced the company’s ability to produce them (it has sold over a million of its most popular Nano S models to date). This has prompted the company’s chief technology officer to state publicly that Ledger’s built-in security model is so robust that it is safe to purchase their products from a wide range of third-party sellers, including Amazon and eBay.
Ledger’s message to users regarding the lack of anti-tampering mechanisms on its cryptocurrency hardware wallets.
But Rashid discovered that a reseller of Ledger’s products could update the devices with malicious code that would lie in wait for a potential buyer to use it, and then siphon the private key and drain the user’s cryptocurrency account(s) when the user goes to use it.
The crux of the problem is that Ledger’s devices contain a secure processor chip and a non-secure microcontroller chip. The latter is used for a variety of non-security related purposes, from handling the USB connections to displaying text on the Ledger’s digital display, but the two chips still pass information between each other. Rashid found that an attacker could compromise the insecure processor (the microcontroller) on Ledger devices to run malicious code without being detected.
Ledger’s products do contain a mechanism for checking to ensure the code powering the devices has not been modified, but Rashid’s proof-of-concept code — being released today in tandem with an announcement from Ledger about a new firmware update designed to fix the bug — allows an attacker to force the device to sidestep those security checks.
“You’re essentially trusting a non-secure chip not to change what’s displayed on the screen or change what the buttons are saying,” Rasheed said in an interview with KrebsOnSecurity. “You can install whatever you want on that non-secure chip, because the code running on there can lie to you.”
Kenneth White, director of the Open Crypto Audit Project, had an opportunity to review Rashid’s findings prior to their publication today. White said he was impressed with the elegance of the proof-of-concept attack code, which Rashid sent to Ledger approximately four months ago. A copy of Rashid’s research paper on the vulnerability is available here (PDF). A video of Rashid demonstrating his attack is below.
White said Rashid’s code subverts the security of the Ledger’s process for generating a backup code for a user’s private key, which relies on a random number generator that can be made to produce non-random results.
“In this case [the attacker] can set it to whatever he wants,” White said. “The victim generates keys and backup codes, but in fact those codes have been predicted by the attacker in advance because he controls the Ledger’s random number generator.”
Rashid said Ledger initially dismissed his findings as implausible. But in a blog post published today, Ledger says it has since fixed the flaw Rasheed found — as well as others discovered and reported by different security researchers — in a firmware update that brings Ledger Nano S devices from firmware version 1.3.1 to version 1.4.1 (the company actually released the firmware update on March 6, potentially giving attackers time to reverse engineer Rashid’s method).
The company is still working on an update for its pricier Ledger Blue devices, which company chief security officer Charles Guillemet said should be ready soon. Guillemet said Nano-S devices should alert users that a firmware update is available when the customer first plugs the device into a computer.
“The vulnerability he found was based on the fact that the secure element tries to authenticate the microcontroller, and that authentication is not strong enough,” Guillemet told KrebsOnSecurity. “This update does authentication more tightly so that it’s not possible to fool the user.”
Rasheed said unlike its competitors in the hardware wallet industry, Ledger includes no tamper protection seal or any other device that might warn customers that a Nano S has been physically opened or modified prior to its first use by the customer.
“They make it so easy to open the device that you can take your fingernail and open it up,” he said.
Asked whether Ledger intends to add tamper protection to its products, Guillemet said such mechanisms do not add any security.
“For us, a tamper proof seal is nothing that adds security to the device because it’s very easy to counterfeit,” Guillemet said. “You can buy some security seals on the web. For us, it’s a lie to our customers to use this kind of seal to prove the genuineness of our product.”
Guillemet said despite Rashid’s findings, he sees no reason to change his recommendation that interested customers should feel free to purchase the company’s products through third party vendors.
“As we have upgraded our solution to prove the genuineness of our product using cryptographic checks, I don’t see why we should change this statement,” he said.
Nevertheless, given that many cryptocurrency owners turn to hardware wallets like Ledger to safeguard some or all of their virtual currency, it’s probably a good idea if you are going to rely on one of these devices to purchase it directly from the source, and to apply any available firmware updates before using it.
Last Wednesday, the New York State Public Service Commission (PSC) ruled that municipal power companies could charge higher electricity rates to cryptocurrency miners who try to benefit from the state's abundance of cheap hydroelectric power. Ars Technica reports: Over the years, Bitcoin's soaring price has drawn entrepreneurs to mining. Bitcoin mining enterprises have become massive endeavors, consuming megawatts of power on some grids. To minimize the cost of that considerable power draw, mining companies have tried to site their operations in towns with cheap electricity, both in the U.S. and around the world. In the U.S., regions with the cheapest energy tend to be small towns with hydroelectric power. But mining booms in small U.S. towns are not always met with approval. A group of 36 municipal power authorities in northern and western New York petitioned the PSC for permission to raise electricity rates for cryptocurrency miners because their excessive power use has been taxing very small local grids and causing rates to rise for other customers. The PSC responded on Wednesday that it would allow those local power companies to raise rates for cryptocurrency miners. The response noted that New York's local power companies, which are customer-owned and range in size from 1.5 MW to 122 MW, "acquire low-cost power, typically hydro, and distribute the power to customers at no profit." If a community consumes more than what has been acquired, cost increases are passed on to all customers. "In Plattsburgh, for example, monthly bills for average residential customers increased nearly $10 in January because of the two cryptocurrency companies operating there," the PSC document says. The city of Plattsburgh, New York has since imposed an 18-month moratorium on commercial cryptocurrency mining to "protect and enhance the city's natural, historic, cultural and electrical resources."
An anonymous reader writes: Twitter plans to ban most cryptocurrency-related ads in the next few weeks, as Sky News first reported and a source confirms to Axios. Why it matters: The recent boom in cryptocurrencies and digital tokens has unsurprisingly attracted some fraudsters. Twitter is following in the footsteps of Facebook and Google, though it's been having its own problems with accounts promoting scams.
In a day filled with all sorts of game development-related API and framework news, Microsoft also has an AI-related announcement for the day. Parallel to today’s DirectX Raytracing announcement – but not strictly a DirectX technology – Microsoft is also announcing that they will be pursuing the use of machine learning in both game development and gameplay through their recently revealed Windows Machine Learning framework (WinML).
Announced earlier this month, WinML is a rather comprehensive runtime framework for neural networks on Windows 10. Utilizing the industry standard ONNX ML model format, WinML will be able to interface with pre-trained models from Caffe2, Tensorflow, Microsoft’s own CNTK, and other machine learning framework. In turn, the DirectML execution layer is able to run on top of DX12 GPUs as a compute task, using the supplied models for neural network inferencing.
The initial WinML announcement was a little ambiguous, and while today’s game-focused announcement has a more specific point to it, it’s still somewhat light on details. And this is mostly because Microsoft is still putting out feelers to get an idea of what developers would be interested in doing with machine learning functionality. We’re still in the early days of machine learning for more dedicated tasks, never mind game development and gameplay where this is all brand-new, so there aren’t tried-and-true use cases to point to.
On the development front, Microsoft is pitching WinML as a means to speed asset creation, letting machine learning models shoulder part of the workload rather than requiring an artist to develop an asset from start to end. Meanwhile on the gameplay front, the company is talking about the possibilities of using machine learning to develop better AIs for games, including AIs that learn from the player, or even just AIs that act more like humans. None of which is new to games – adaptive AIs have been around long before modern machine learning has – but it’s part of a broader effort to figure out what to do with this disruptive technology.
ML Super Sampling (left) and bilinear upsampling (right)
Though one interesting use case that Microsoft points out that does seem closer to making it to market is using machine learning for content-aware imagine upscaling. NVIDIA was showing this off last year at GTC as their super resolution technology, and while it’s ultimately a bit of a hack, it’s an impressive one. At the same time similar concepts are already used in games in the form of temporal reprojection, so if super resolution could be made to run in a reasonable period of time – no longer than around 2x the time it takes to generate a frame – then I could easily see a trend of developers rendering a game at sub-native resolutions and then upscaling it with super resolution, particularly to improve gaming performance at 4K. Or to work with Microsoft’s more conservative example, using such scaling methods to improve the quality of textures and other assets in real-time.
Moving on, while today’s announcement from Microsoft doesn’t introduce any further technologies, it does offer a bit more detail into the technological underpinnings of WinML. In particular, while the preview release of WinML is FP32 based, the final release will also support FP16 operations. The latter point being of some great importance as not only do recent GPUs implement fast FP16 modes, but NVIDIA’s recent Volta architecture went one step further and included dedicated tensor cores, which are meant to work with FP16 inputs.
Another notable development here is that while WinML generates HLSL code as a baseline mode, hardware vendors will also have the option of writing DirectML metacommands for WinML to use. The idea behind these highly optimized commands is that hardware vendors can write commands that take full advantage of their hardware – including dedicated hardware like tensor cores – in order to further speed up WinML model inferencing over what’s capable with a naïve HLSL program. Working with NVIDIA, Microsoft is already showing off an 8x performance improvement over baseline DirectML performance by using FP16 metacommands.
Ultimately as with today’s DirectX Raytracing announcement, Microsoft’s WinML gaming announcement is about priming developers to use the technology and to collect feedback on it ahead of its final release. More so than even DirectX Raytracing, this feels like a technology where no one is sure where it’s going to lead. So while DXR has a pretty straightforward path for adoption, it will be interesting to see what developers do with machine learning given that they’re largely starting with a blank slate. To that end, Microsoft has a couple of WinML-related presentations scheduled for this week at GDC, which hopefully should shed a bit more light on developer interest.
At the moment, artificial intelligence may have perfect memories and be better at arithmetic than us, but they are clueless. It takes a few seconds of interaction with any digital assistant to realize one is not in the presence of a very bright interlocutor. Among some of the unexpected items users have found in their shopping lists after talking to (or near) Amazon’s Alexa are 150,000 bottles of shampoo, sled dogs, “hunk of poo,” and a girlfriend.