How Economic Downturns Jeopardize Innovation and Cybersecurity

Silicon Valley Bank’s collapse intensifies cybersecurity funding crisis

The sudden collapse of Silicon Valley Bank (SVB) has sent shock waves across the technology industry, impacting the investor class and tech sector in an unprecedented way. The bank had long been central to the banking needs of the cybersecurity community, with public reports suggesting that nearly 500 cybersecurity vendors banked with them. Investors spooked by the collapse are re-evaluating practices in the short term, leading to a downturn in cybersecurity funding that threatens not just the sector itself, but also the security of private and federal organizations that rely on cybersecurity innovation to keep threat actors at bay.

The Current Cybersecurity Landscape

Cybercrime is on the rise, and our current cybersecurity landscape is challenging. Various reports suggest that cyberattacks on industrial firms rose by 87% in 2022, while cyberattacks against governments increased by 95% in the second half of that year. Last year, the global cyberattack volume hiked by 38%, with the average total cost of a data breach rising to $4.35 million. Keeping up with the attack surface is an ongoing struggle within many IT departments. Economic turbulence and spikes in cybercrime go hand in hand. Cybercrime surged by 40% on average in the aftermath of the 2009 recession and during the COVID-19 pandemic.

Why Hackers are Essential to Combat Cybercrime

In such a challenging economic landscape, reduced funding for cybersecurity startups is a major problem that could cause a surge in cybercrime. Hackers represent the most viable solution to the mounting budget concerns. Hackers have always been one of the best solutions to rising rates of cybercrime, and they replicate bad actors’ strategies to penetrate systems and inform organizations about vulnerabilities. They bring a different mindset to system defenses, and they’re as inventive as the criminals they’re trying to combat. The affordability of hackers is notable, particularly in times of economic stress. Companies can access a diverse range of expertise and knowledge by using hackers who provide quick insight on vulnerabilities and suggest remediation. Companies can incentivize hackers to bring vulnerabilities by offering incentives such as bug bounty programs. Hackers supplement cybersecurity teams, reduce internal burnout and improve organizations’ success. The US government launched Hack the Pentagon, and since then, hackers have alerted the Department of Defense (DoD) to more than 45,000 vulnerabilities. Insights generated by hackers are now a routine part of government security in many countries worldwide.

Conclusion

As organizations brace themselves for the potential downside of the ongoing economic downturn, a significant breach could spell economic disaster. Organizations must stay on high alert by incorporating innovative solutions to stay protected, given the reduced funding in the sector. Hackers remain one of the best viable options for organizations seeking to remain resilient in the current precarious situation, supplementing internal cybersecurity teams with extensive expertise and providing valuable insights on vulnerabilities. It’s time to mainstream the actions of ethical hackers to combat the threats posed by the surge in cybercrime.