Has the global IT outage affected cryptocurrency?

While the facts surrounding this global IT outage are still being investigated, one thing is clear: centralization could have serious consequences.

On June 19, the world was rocked by a massive and unprecedented outage, with countless Windows-based computers rendered useless by the dreaded “blue screen of death.”

The outage was widespread, affecting businesses and consumers in India, Germany, Australia, Spain, the UK and the US, to name a few.

Flights were suspended, supermarkets could not accept cash, TV news channels stopped broadcasting and some hospitals even declared emergencies.

Six US states have shut down 911 services, banking websites have been disrupted and governments have had to call in emergency services to deal with the aftermath.

At this stage, it does not appear that a malicious cyber-attack could have caused this stunning outage that has brought to its knees many of the digital services we all take for granted.

Instead, it appears to be related to a software update from IT security company CrowdStrike, a company that aims to prevent breaches and hacks.

Microsoft was quick to deny any wrongdoing, and when Wall Street markets opened, CrowdStrike’s stock price fell 15%, wiping $12.5 billion off the company’s value.

But there are a few people who will feel quite relieved that they were not affected by this chaos: mainly Mac and Linux users, who were able to continue working as usual.

It is also significant that cryptocurrency companies were not affected – and while the facts surrounding this outage are still being investigated, one thing is clear: centralization can have serious consequences.

The fact that so many critical pieces of infrastructure relied on the same software clearly demonstrates what can happen when one small thing stops working as usual.

In contrast, blockchains are decentralized, meaning there is no single point of failure and blocks can be verified by miners and validators as usual.

We are slowly seeing a small number of businesses start using blockchains, and after today’s crash, that number could increase.

The crypto community’s reaction was swift and brutal, with X CEO Elon Musk leading the charge, calling it “the biggest failure in tech.”

And, quite naturally, there has also been a surge in activity around memecoins – a catastrophic error has led to the creation of a whole series of new tokens.

What were they called, you ask? CrowdStrike and bluescreenofdeath.

Will lessons be learned?

It’s safe to say that this is the biggest outage since at least 2017, when the WannaCry ransomware attack hit more than 300,000 computers.

But for many customers with old-fashioned bank accounts, such glitches and technical problems occur with alarming regularity.

There have been cases where banking apps and websites have suddenly stopped working – often on payday – leaving countless consumers unable to pay their bills.

By comparison, Bitcoin has managed to achieve 100% uptime over the past 11 years, with only two minor outages recorded since its launch in 2009.

The bigger concern now is that the outage may not be fixed quickly, with CrowdStrike admitting that efforts to resolve the issue will take “some time.”

Computers that have encountered the dreaded blue screen of death may need some expert help. According to Microsoft, one surreal solution that seems to solve the problem is to reboot the PC 15 times.

Meanwhile, there will be long-term consequences for businesses. Some workers have not been paid on time – and the fallout for the aviation sector, with passengers delayed and planes in the wrong place, could take many days to unravel.

This is particularly frustrating for travellers in the UK. Why? Because it all coincides with what was expected to be the busiest day of the year for air travel, as the summer holidays for schoolchildren begin.

There is no doubt that governments and large corporations will be trying to learn from this outage and ensure that they have action plans in place should something similar happen again.

Given that we live in an increasingly digital and interconnected world, it now seems like a matter of when, not if.