In an increasingly online world, cybersecurity incidents and fraudulent activities are on the rise across all major industries. Now that e-commerce, online banking, remote working, and other digital applications have become integral parts of the global economy, demand for cybersecurity should only increase further.
After record investment last year, 2021 is shaping up to be another breakout year for cybersecurity firms who continue to strengthen online network protection, bolster revenue, and implement new security frameworks.
Related ETF: First Trust NASDAQ Cybersecurity ETF (CIBR)
Shift to an Online World
The past year has accelerated digitization in almost every sector of the economy. It is much more common to work remotely, shop online, and even handle personal and business finances digitally in the post-pandemic era. This dramatic, global shift will now drive the need for increased cybersecurity as more and more private information is brought and hosted online.
Remote work is proving more to suitable for certain businesses and employees over the long term. According to a recent Microsoft survey, 73% of respondents said they would prefer flexible remote option to continue. Forbes took it one step further and reported that 58% of workers surveyed would look for a new job if remote offerings are not extended.
Digital banking has also had a boost from the pandemic, but the trend is here to stay. Business Insider found that 75.4 % of US adults use digital banking services monthly, with that number expected to rise to 80.4% by 2025.
Even the energy industry faces heightened risks from digital vulnerabilities. Last Friday, Colonial Pipeline, announced that its IT systems were “the victim of a cybersecurity attack”, forcing the shutdown of 5,500 miles of pipeline that carry nearly half of all fuel supplies on the East Coast. As of Sunday, there is no timetable for the major pipelines to get back online.
As Bloomberg notes, ransomware cases involve hackers seeding networks with malicious software that encrypts the data and leaves the machines locked until the victims pay the extortion fee. Per a Reuters source, hackers took more than 100 gigabytes of data, according to a person familiar with the incident. This is believed to be the biggest attack of its kind on a US fuel pipeline.
Overall, the cost of cybercrime jumped to over $1 trillion in 2020, according to cybersecurity firm McAfee.
A surge in e-commerce led to skyrocketing online fraud last year, as growing at double the rate of e-commerce in 2020. 2021 has seen an acceleration of this trend with e-commerce fraud projected to surpass $20 billion in 2021, a huge threat to both business profitability and consumer information.
There have been very well-known companies battling major cybersecurity breaches in 2021. Most notably was Microsoft. The big tech company recently saw an estimated 250,000 of its Microsoft exchange users affected by a cyberattack in which private email data was stolen. CNBC reported this as one of the largest cybersecurity events of the year.
That same breach extended to the US federal government as well…