Galveston district uncovers cryptocurrency-mining devices at schools – Galveston County Daily News

Galveston Independent School District President Tony Brown took a moment Wednesday night to publicly thank the district’s information technology department for uncovering a surreptitious cryptocurrency-mining operation underway at six different schools.

The district’s Management of Information Systems department removed Bobcat crypto mining devices installed at six different schools by a former district employee, officials said.

Cryptocurrency is any form of currency that exists digitally or virtually and uses cryptography to secure transactions. The first and most popular cryptocurrency, bitcoin, launched more than a decade ago.

Since then, students and rogue government employees have been mining for the virtual currencies, in some cases using computer equipment, electrical power and network processing power that belongs to their schools or employers, according to publication Government Technology.

Bitcoin mining involves solving complex computational puzzles to verify digital currency transactions. Significant amounts of energy and computer processing power are needed to run the mining function, according to the publication.

Brown wanted to emphasize the word “former,” when describing the employee, he said. He didn’t offer a name, but emphasized the person no longer worked for the school district. Officials on Thursday also emphasized school district data wasn’t breached in the incident.

The foiling of the crypto mining with school equipment was an example of the district’s data protection systems working as they were intended, officials said. IT employees began noticing anomalies in network traffic and discovered the devices, which likely had been installed in March during spring break, Brown said.

“I can’t describe it in any more detail, because I’d be in way over my head, as far as what it was and what they did,” Brown said from his seat in the school district board room.

The matter is the subject of an investigation, Brown told The Daily News.

Brown said he had wanted to give credit to the people who identified the problem early and “stopped the problem before it could start.”

Superintendent Jerry Gibson on Thursday issued a statement confirming the district discovered several unauthorized devices attached to the district network. The devices were discovered on April 8, the employee responsible for installing the devices was placed on administrative leave and ultimately resigned his position with the district on April 18, Gibson said.

“Although, the investigation related to the employee’s misuse of district property is ongoing, it has been confirmed that there was no breach of data resulting from this incident,” Gibson said. “We are pleased that the security measures put in place by the district were effective in detecting and preventing any potential issues.”

Brown and Gibson confirmed the devices weren’t cameras installed in district schools, dousing a rumor that circulated among Facebook pages Thursday.

In recent years, there have been incidents across the country in which people have been fined, fired or even arrested, for using their workplaces to generate new bitcoins.

Tokens exist as chunks of data that are digitally signed each time they travel from one owner to the next. These transactions are stored in data blocks; when the transactions are verified, those blocks are chained to previous blocks, forming a digital ledger called a blockchain.

Copies of each blockchain are stored in multiple locations, making them extremely difficult to tamper with, experts say.

Blockchains are constructed by people known as miners who lend their computing power to verify cryptocurrency transactions so that no one can spend the same token twice.

Miners receive new cryptocurrency tokens as rewards.

There is tremendous potential profit in mining for bitcoin. The value of the currency varies and is famously volatile. But as of Thursday, a single bitcoin was worth $40,834, according to Coindesk, a news site focused on cryptocurrencies.

Material from the Associated Press was used in this report.

Source: https://www.galvnews.com/news/free/article_7c570fd8-9a9a-516d-aa8c-8583cecd72b2.html