Real Demons in the Virtual World – Emerging Cyber Risks in the Metaverse

By Vaibhav Koul, Managing Director, Cyber Security & Privacy, Protiviti Member Firm for India

The metaverse is a emerging concept in the technology that views a virtual world where people can interact with one another and digital things in a simulated environment, potentially changing how we interact with technology and with one another. As real and virtual items merge, a collaborative, immersive virtual world emerges.

The term “metaverse” originated from Neal Stephenson’s 1992 book “Snow Crash,” describing a virtual reality world for complex interactions between people and digital elements. The concept has captivated technologists, futurists, and businesspeople. Early examples of metaverse-like environments were seen in platforms like Second Life and World of Warcraft, offering expansive worlds for user interaction and activities. Newer platforms like Decentraland and Horizon Workrooms have emerged, drawing attention. In 2022, H&M established a retail clothing store in the metaverse on the CeekVR platform, enabling customers to explore and purchase items.

Today, the metaverse finds applications in social media, online gaming, virtual meetings, and more. It revolutionizes human communication and interaction with technology. Its potential spans telepresence, collaboration, virtual travel, education, and training. Virtual reality and augmented reality will shape the metaverse’s evolution, delivering immersive and authentic experiences. It is estimated that by 2026, 25% of people will spend at least one hour a day in the metaverse for work, shopping, education, social and/or entertainment (Source : Gartner)

Perpetrators of cybercrime in the Metaverse will find it easier to dehumanize online users, thus facilitating their illicit activities. When offenders cease recognizing the humanity of their victims, it becomes simpler for them to engage in harmful actions against them.

Recognizing and addressing cybersecurity threats is vital for the metaverse’s optimal utilization. Proactive measures must be taken to mitigate risks as this virtual world evolves. The metaverse’s immersive and interconnected nature, along with its use of advanced technology and virtual assets, introduces distinct cybersecurity challenges not typically encountered in conventional environments.

Below are some examples :
• Immersive nature makes the metaverse susceptible to cyber attacks: A metaverse is an interactive environment that distorts the boundaries of virtual and physical reality. This will allow hackers to manipulate user behaviour and exploit vulnerabilities in the online world more easily.
Below are some examples of how to do this:

A few examples are as below –

o A virtual mall within the Metaverse allows users to purchase real-world items using cryptocurrencies. A cybercriminal can create an attractive virtual storefront that mimics a popular brand, giving users the impression that they are shopping on her legitimate website. Unsuspecting buyers can give up personal and financial information and become victims of phishing and identity theft.
o Virtual social spaces where users can interact with each other using their avatars. Cybercriminals can exploit this setting by manipulating the behavior of other users’ avatars or creating fake avatars to spread misinformation, harass users, or otherwise of cyberbullying.
o On the gaming side of the Metaverse, hackers can exploit vulnerabilities in game code or use hacks and mods to cheat, which degrades the overall gaming experience and leads to unfair competition. is created.

• Virtual Asset Theft : In the metaverse, various virtual assets such as digital currencies, virtual real estate, and virtual goods are valuable and are targeted by cybercriminals in unique ways. Examples of such cyberattacks include virtual property theft, virtual currency fraud, and virtual goods counterfeiting. It is possible that a hacker may exploit a vulnerability in the smart contract code of the blockchain-based virtual world to steal a virtual real estate property

• Interconnectivity leading to greater impact of cyber attack: The metaverse’s high level of interconnectivity among users and virtual objects increases the potential for cyber threats to spread rapidly and cause significant harm. A cyber attack on the traditional IT infrastructure connected to the virtual environments has potential of impacting various areas within the metaverse. Since the infra is interconnected with other virtual environments, the attack has the potential to impact other areas of the metaverse.

• New technology adoption and related risks :
The Metaverse utilizes cutting-edge technologies like virtual reality, blockchain, and AI, presenting unique cybersecurity challenges that differ from those encountered in traditional cyber environments. In 2021, researchers showcased a hack that enabled them to manipulate the Oculus Quest 2 VR headset, projecting counterfeit images directly into the user’s field of view. This type of attack grants unauthorized control over the headset’s sensors, cameras, and potentially sensitive information, including personal data, location details, movement patterns, and login credentials. Furthermore, attackers can generate deceptive objects and events within the virtual environment, posing risks to users and their virtual assets.

• User behaviour related risks: The metaverse represents a dynamic and swiftly developing realm where users partake in innovative activities that may not be fully comprehended by developers and security experts. Within this landscape, malicious individuals exploit users’ trust, coaxing them into divulging sensitive information or granting access to their accounts. Social engineering attacks manifest in various ways within the metaverse, ranging from deceptive phishing scams to impersonating trusted users for the purpose of establishing trust. In some instances, malicious actors may masquerade as virtual landlords, deceiving multiple users into providing access to their virtual properties. Once this access is obtained, these malevolent actors proceed to abscond with the users’ virtual assets, encompassing valuable digital currencies and rare virtual items.

• Malicious Third Party products : In the metaverse, users can buy third-party objects to enhance their virtual world experience. However, some of these sites may not be legitimate, including those that offer currency exchange for in-world dollars. For new users, or “noobs,” it can be difficult to distinguish between legitimate and fraudulent third-party vendors without in-world experience.

• Malware , phishing attacks and exploits : users face the risk of being targeted by malicious software and phishing attacks aimed at pilfering their personal information or seizing control of their avatars. Additionally, there is a possibility that malicious actors may exploit vulnerabilities present in virtual environments to manipulate objects within the metaverse or gain unauthorized access to restricted areas. These threats underscore the importance of implementing robust security measures to protect users and their digital identities within the metaverse.

• Privacy breaches: Personal data, including user information and online activities, is at risk of being disclosed or compromised, potentially resulting in identity theft or breaches of privacy. Virtual experiences often lack geographical boundaries, leaving users vulnerable to the policies of the platform provider. The absence of robust regulations and guidelines specifically tailored to metaverse environments aggravates this issue.

• Cyberbullying, harassment and terrorism: Just like in the real world, users of the metaverse can experience cyberbullying and harassment that can lead to emotional harm. Below. Metaverse technology has the potential to dramatically increase threats in the real world. Robbers may have better access to potential victims and may be more motivated to engage in criminal activity as digital representations become more realistic and interactive. Terrorists may be able to train in virtual replicas of the iconic buildings with detailed site plans. Likewise, criminals intent on breaking into businesses or homes could benefit from this technology.

As the metaverse is still evolving, there are limited regulatory measures to safeguard consumers, and victims of digital asset theft have limited options for redress. Additionally, companies operating within this area face minimal requirements or obligations. Nonetheless, organizations can take specific proactive measures to recognize and protect both themselves and their customers from the emerging cyber threats impacting the metaverse.

Here are some measures that can be considered :
• Risk assessment and mitigation framework: Develop a robust risk assessment and mitigation framework for the metaverse. Assess potential cyber risks by analyzing the system’s architecture, data flow, and user behavior. Ensure the framework provides comprehensive protection against cyber threats and encourages safe and responsible usage of the virtual world.
• Security measures: In addition to traditional cybersecurity controls, implement robust security measures to prevent cyber threats, such as NextGen detection and prevention systems, and encryption protocols. Organizations need to establish measures to validate third-party messages and prevent malicious ones, as compromised legitimate accounts can be sources of fraudulent messages. As metaverse environments advance, there will be ongoing innovation in developing and implementing these controls.
• User authentication and access control: Implement strict user authentication and access control procedures to safeguard sensitive data and virtual assets. Two-factor or multi-factor authentication is essential to minimize the risks of account takeovers for social media and email accounts.
• Content oversight and moderation : Establish content oversight mechanisms to curb the dissemination of malicious content, phishing attempts, and other harmful activities in the metaverse.
• Incident response: Develop an incident response plan to address potential cyber threats and mitigate their impact. This should include procedures for identifying, reporting, and responding to security incidents.
• Regular testing and updates: Regularly test and update the metaverse’s security measures to ensure that they are effective and up-to-date with the latest cyber threats.
• Education and awareness: Educate users about cyber risks and promote responsible behaviour, such as safe browsing habits and password management.
• Compliance with regulations: Ensure compliance with relevant regulations and standards, such as data protection laws and cybersecurity best practices (and stay updated as these take shape).
• Use encryption: Employ encryption protocols to protect user data and sensitive information as it is transmitted within the metaverse.
• Develop security standards: Create security standards and guidelines for developers to follow when designing and building virtual environments and applications for the metaverse.
• Collaborate with other organizations: Work with other organizations in the metaverse to share information about potential threats and collaborate on security measures.

To conclude, the metaverse poses distinctive and intricate cybersecurity risks that demand meticulous attention and proactive measures to tackle. As this virtual realm progresses and expands, it will be of utmost importance for both individuals and organizations functioning within the metaverse to remain vigilant about potential threats and implement safeguards to shield themselves and their digital assets.

By embracing robust security practices, staying alert, and collaborating with others in the metaverse, we can help ensure that this innovative and thrilling technology remains a protected and secure haven for all users.

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