Editor’s note: We turn things over today to colleague Nomi Prins…
With cybercrimes affecting nearly 1 in 3 Americans – and the number of cybercrimes rising still – there’s been a recent push for solutions.
And it’s not just individuals who are feeling the threats… businesses and governments are also on the hunt for ways to protect their data from cybercriminals.
But there’s a new line of defense in the fight against cybercrime – artificial intelligence (AI).
Read on for more from Nomi on the intersection of cybersecurity, AI, and national defense… and one way you can play it.
If you have an internet connection, a password, or any financial accounts online – you could be vulnerable.
Nearly a third of Americans report being victims of cybercrime.
In 2023 alone, the FBI recorded nearly 900,000 complaints. That was an all-time high and up 10% from the year before.
But there are even bigger fish out there.
In 2017, more than 300,000 computers across 150 countries were hit with the “WannaCry” ransomware virus. Losses from hack attacks that year hit nearly $20 billion.
In 2018, hackers stole 500 million records from Marriot, breached over 30 million Facebook accounts, and stole over 92 million records from a DNA website.
And in 2023, hackers hit Johnson Controls International. It’s a major tech company with direct ties to the Department of Homeland Security. The data theft and ransom demands cost the company $27 million.
That’s why cybercrime is a critical topic. One whose threat is growing for regular people, businesses, and the government.
But it’s not all bad news. Today, we’ll unpack the rapid expansion and integration of three major growth areas: artificial intelligence (AI), cybersecurity, and enhanced national security measures.
The Role of Cybersecurity in National Security
Cybersecurity plays a vital role in national security.
So much so that, in 2007, the government created an official Cybersecurity and Infrastructure Security Agency (CISA).
It impacts the integrity and resilience of a nation’s critical infrastructure and information systems – both in the physical and cyberspace.
Cyberattacks can cause significant economic losses, deaths or injuries, reputational damage, and compromise national security.
The next great pioneer for opportunity, along with threats that the CISA is monitoring, is the boom in AI both in the private sector and for the government.
CISA Director Jen Easterly warned last year at a security summit:
Imagine a world in the not-too-distant future where how-to guides, AI-generated imagery, and auto-generated shopping lists are available for terrorists and for criminals, providing the capability to develop things like cyber weapons, chemical weapons, and bioweapons.
And that’s not even the worst-case scenario.
Easterly warned that generative AI will allow “deep fakes” to escalate as a national security problem. Deep fakes are fabricated videos digitally created to impersonate others.
Easterly also warned that the possibility of rogue actors carrying out harmful attacks is growing. She said:
While one person will use this technology to plan an extravagant dinner party, another person will use the capability to plan a cyberattack or terror attack or to deploy shockingly realistic deep fakes.
Domestic and international cybercriminals are constantly honing their cyber-strategies.
That’s why it’s crucial for everyday folks to stay vigilant. And why those working in national security and defense are urgently working to stay ahead of cybercriminals.
That’s where AI comes in.
AI in Cybersecurity
There are several ways that AI applications and technologies will enhance cybersecurity. These include:
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Cyber Threat Detection and Prevention: AI algorithms analyze vast amounts of data in real-time to identify potential threats and anomalies, enabling faster detection. What could have taken weeks or months to pinpoint could take minutes.
Generative AI algorithms used for threat detection and prevention in cybersecurity include machine learning algorithms, anomaly detection algorithms, and behavioral analytics algorithms.
Machine learning algorithms can be trained on large datasets to identify patterns, classify data, and locate unusual or malicious threats. Anomaly detection algorithms locate deviations from normal behavior. And behavioral analytics algorithms analyze user behavior to identify potential threats or insider attacks.
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Cyber Incident Response: AI-powered systems can automate routine cybersecurity tasks, such as incident response, reducing the burden on cybersecurity teams.
By detecting the sudden surge in traffic from multiple IP addresses, the AI system can alert cybersecurity teams to take immediate action so they can block malicious IP addresses and prevent an attack from disrupting critical systems.
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Data Privacy and Access Control: AI-powered systems can enforce strong access controls and flag unauthorized attempts to access sensitive data.
These three protections are critical to the future of tech. They’re also vital for big companies that process reams of personal data and sensitive information.
You’d be surprised by how many household name companies have been hacked. Some of the major breaches in the past 10 years might even be companies you work with, bank with, or trust with your information.
For instance, between 2013 and 2016, Russian hackers attacked Yahoo’s database. They stole data records containing names, email addresses, birth dates, and passwords from 3 billion accounts.
In 2014, another Russian cyberattack compromised over 76 million households and 7 million small business accounts at JPMorgan Chase.
And in 2024, AT&T announced a leak affecting 73 million current and former customers. The cyberattack exposed private account information, including Social Security numbers.
This is only a short list of recent high-profile hacks. It should be a warning to protect your data and take simple steps like changing your password frequently.
But it’s also an opportunity if you’re looking to build your wealth in the markets.
One way to take advantage of this is to buy the Global X Artificial Intelligence and Technology ETF (AIQ). It covers a broad array of large companies involved in AI products, services, and hardware.
I recommend buying it in increments to hedge yourself against market volatility. For example, if you have $1,000 to invest, break that up into $200 or $250 per month.
That will allow you to take advantage of the upside in AI as it becomes more integral to the cybersecurity industry.
Regards,
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Nomi Prins
Editor, Inside Wall Street with Nomi Prins