Chapter 1: What is the main topic discussed in this episode?
Welcome to Tech News Briefing. It's Tuesday, February 3rd. I'm Belle Lin for The Wall Street Journal. Your deskmate, your boss, the colleague from across the office could all be the internal source passing off information to hackers who want to steal data from your company.
We look at why so-called insider threats are on the rise and how now hackers are directly recruiting some corporate employees. Then, Brian Armstrong, the soft-spoken head of crypto exchange Coinbase, is clashing with JPMorgan Chase CEO Jamie Dimon and other bank leaders over the future of finance.
We look at how Armstrong has cultivated his persona to further Coinbase's agenda, why bank CEOs are fighting to keep their turf, and how the Trump administration could change the whole trajectory of both. But first, roughly 32% of all data loss incidents at organizations worldwide over the past year involved a malicious insider.
That's up from 20% in 2024, according to the cybersecurity firm Proofpoint. And these malicious insiders are your everyday employees.
Chapter 2: What are the rising insider threats in cybersecurity?
So what's driving them to be open to assisting with cyber attacks on their own employers? WSJ cybersecurity reporter Angus Loughton is here to discuss the phenomenon. Angus, company insiders helping cyber criminals is nothing new. But what's behind this current wave of disgruntled workers who seem to be willing to risk it all?
For starters, this is a fascinating kind of story because it's an under-the-radar economic indicator of what's really happening out there on the ground. And what appears to be happening out there on the ground, at least among a lot of tech workers, is they're none too happy. There's been flat hiring. There's been flat wages. Folks are getting passed over for promotions.
People are getting outsourced, different jobs. AI is taking over a lot of the manual labor end of the tech stuff. So there's a lot of people who aren't too happy. And that's what makes hackers happy, because they can recruit disgruntled insiders to help them with data breaches, because the insiders, of course, have authorized access.
And with that, they're able to get in even under the most strenuous fortified systems, not even through a back door. It's through the front door. and get out a lot of very valuable data.
And how do hackers find and recruit their targets?
This is precisely why it makes it an economic indicator, because hackers typically go on social media sites. They go on career sites like LinkedIn, even X or Facebook, and they're just looking for threads where employees are complaining about their jobs or they're saying, I was just passed over for a promotion and just venting.
And if they think they've got someone who may qualify for assisting them in these attacks, They'll reach out at first.
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Chapter 3: Why is Brian Armstrong at odds with big banks?
They won't say, hey, you want to help us break into your company? They'll just warm up with a conversation and this, that, and the other thing and say, well, look, there is a way you can make a little extra money if you want to. And we're not asking for too, too much. We just need this little bit of data. And then it escalates.
And before you know it, they're fully willing accomplices to a pretty large data breach.
And to that point, how much is this type of threat costing companies? Can you put a dollar amount on how much this actually costs them?
That can be a little bit tricky only because of the reputational damage that these kinds of insider attacks cause. If it were just a glitch in cybersecurity or a technical issue, a digital issue that can be addressed, then that's one thing. But if your customers or what have you see that this is something bigger, a corporate culture issue or angry employees, That's a little harder to fix.
Chapter 4: How is Coinbase challenging traditional banking practices?
So a lot of companies that get hit with an insider, malicious insider attack, don't report it. So it's tricky to get numbers on that. IBM did in their latest sort of cost of data breaches, their best estimate is that it's more lucrative than your average data loss.
It's about $5 million most companies are facing costs, whether that's through the ransom, whether that's just through downtime because you have to fix these things and address them. It can also just be loss of data, business interruptions.
That was WSJ cybersecurity reporter Angus Lowton.
Chapter 5: What sparked the confrontation between Armstrong and Jamie Dimon?
Are you worried about cybersecurity at your job? If you're a listener on Spotify, be sure to leave us a comment with your thoughts. Coming up, the feud between Coinbase and big consumer banks is heating up this winter, and Coinbase chief Brian Armstrong is at the center of it. That's after the break.
Coinbase, the biggest crypto company in the U.S., is facing a major test over its future this week as the White House tries to foster a compromise over a bill that will shape the future of everyday financial services.
The problem is Coinbase and some of the largest banks in the country, including JPMorgan Chase and Bank of America, have found themselves at odds over how to approach one key area that's always been big business for big banks, consumer deposits.
WSJ tech and crypto policy reporter Amrith Ramkumar joins us now to talk about this financial services showdown and how Coinbase CEO Brian Armstrong became the face of the crypto contingent. So Amrith, who exactly is Brian Armstrong and what is he like?
Brian Armstrong is the 43 year old CEO of Coinbase, the giant crypto exchange, and he's the under the radar face of the U.S.
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Chapter 6: How does the Trump administration influence the future of crypto legislation?
crypto industry in the United States. He's survived a lot of booms and busts over the past decade and built Coinbase into what he calls sort of an everything exchange. You can buy Bitcoin, you can also trade stocks. Now you can do stuff with prediction markets. And he says his goal is to eventually be a bank replacement.
And he's gotten a lot of believers and among investors, the company has a market value of something like $55 billion. And he's a staunch defender of the industry. Now he's hated by some people in the banking community who have been offended by how he's lobbying in Washington to get policies that will be friendly for Coinbase in the crypto industry.
Tell us a bit more about that tension between banks and crypto companies.
Yeah, it's like a love-hate frenemy dynamic with crypto and the banks right now. Crypto's been coming on for over a decade and crypto companies have been saying we're the future of finance, banks should partner with us, etc. And banks actually have. So like JP Morgan and Citi and others do have partnerships with Coinbase and other crypto companies as well.
They are sort of nibbling around the edges, wanting to maybe hedge in case crypto does take off and disrupt some of their original business. But the fight that's taking place now is interesting because it's over these rewards or annual payments Coinbase pays holders of a stablecoin offered by Circle through this very unique partnership.
So a stablecoin is a dollar-backed cryptocurrency essentially designed to hold its value. Coinbase has this weird setup where they're allowed to pay holders on its platform of the Circle stablecoin rewards of, let's say, 3.5%. at an annual rate. And so banks are now looking at this and saying, wait a minute, that looks a lot like what I would pay a holder in a checking account.
I would pay them less than 0.1%. But now you're offering these people 3.5% to just hold their cash there, essentially. So that's created this fight that's really erupted in the last month or so in Washington.
And this tension came to a head recently at Davos, where you write that there was a confrontation between Armstrong and JPMorgan Chase CEO Jamie Dimon. Tell us what happened.
So in mid-January, there was supposed to be a markup, a committee vote by the Senate Banking Committee on this market structure bill. This bill has been in the works for years, but they could not agree on several key things. Probably most importantly, this banking versus crypto fight over whether Coinbase and crypto exchanges can pay holders of stablecoins rewards.
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