Community
In a previous post I discussed virtual currency, which is used to purchase virtual goods within a variety of online communities, including social networking websites, virtual worlds, and online gaming sites. These virtual dollars and virtual goods have real value.
Virtual currency includes the points customers receive from retailers, merchants, airlines, hotels, and credit card companies through loyalty reward programs. These reward points are supposedly the second most traded currency on the planet.
Gizmodo reports that hackers have targeted Microsoft points, the currency used to purchase digital goods and gift cards for the Xbox and Zune. Someone cracked the algorithm Microsoft uses to generate codes for those gift cards, and released that information online. A website was used to generate more than a million Microsoft points worth of free gift cards, as well as other Xbox items, before Microsoft was able to shut it down.
In 2009, Facebook created a virtual currency called Credits, which users spend on games and other Facebook content. Facebook has worked with fraud fighters to test and structure this currency so as to avoid attracting criminals, but as with any virtual currency, criminal activity is inevitable.
Hackers even steal carbon credits. European carbon traders were fooled by a phishing email, which allowed hackers to access the victims’ online accounts and then transfer more than $50 million in carbon credits into their own accounts. Of course, the hackers promptly resold those credits for profit.
Virtual thieves can sell stolen points in online forums or on eBay, or they can try to exchange points for rewards. However, most online retailers, social media, and gaming websites recognize the thieves’ behavior patterns when cashing in stolen points. By analyzing the history of the device being used to access a website, the website’s operator can prevent fraudulent transactions.
This content is provided by an external author without editing by Finextra. It expresses the views and opinions of the author.
Sergiy Fitsak Managing Director, Fintech Expert at Softjourn
14 August
Mete Feridun Chair at EMU Centre for Financial Regulation and Risk
Oleksandr Strozhemin Co-founder and CEO at Trinetix
13 August
Elaine Mullan Head of Marketing and Business Development at Corlytics
12 August
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