Use of Side channel attacks on High Frequency Trading networks to profit Millions of Dollars January 11, 2011
Posted by admin in : Uncategorized , trackbackHigh frequency trading networks which complete stock transactions in micro seconds can be vulnerable to manipulation by the hackers for unfair advantage. By inserting small amounts of nuisance packets and thereby latencies to the otherwise good traffic can subtly alter the course of the trading decisions resulting in pocketing millions of dollars in a matter of few seconds. A few extra milliseconds can enable trades to execute ahead of the competition, thereby increasing profits for the hackers.
With the growing adoption of VOIP technologies, ubiquitous connectivity, sophisticated online betting (and trading) algorithms, a sub micro second delay can result in enough perturbations to cause severe losses!!
The scary part is that there is no adequate security solution in the market today to adequately combat this threat. Traditional rate based controls that Session Border Controllers (SBC) provide are good in detecting DOS attacks when there is a sudden upsurge in malicious traffic coming from a specific IP source. However, a side-channel attack is infinitely more subtle, as it adds just enough nuisance packets to a legitimate data stream to slow the data just enough to give someone else a chance to move first in the market. And these attacks can be simultaneously triggered from multiple random source locations making the detection even much harder.
What is need is pretty much a self-guided learning and mitigation system that automatically figures out such nuisance traffic in real time; no matter where it comes from, what packet granularity it may arrive in or at what rate it comes in; thwart it, blacklist the offending source locations while allowing legitimate business traffic to operate uninterrupted at mission critical latencies. This will be the true utopia security solution required to protect such high frequency trading networks against these attacks.
Ref — http://www.infoworld.com/d/the-industry-standard/hackers-find-new-way-cheat-wall-street-everyones-peril-699?source=IFWNLE_nlt_daily_2011-01-06
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