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This story got me thinking; what stops hackers from using huge botnets to mine bitcoins? Surely more profitable than sending out spam?

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I don't know... You make about 0.1 cents per hour mining with a in the wild CPU, that's a lot of emails that could be sent out. Even if spam has a conversion rate of 1 in 10 million it is probably more worth it.

They aren't alternatives: spam is network IO bound, mining is CPU bound. The smart bot herder would do both.

The main danger is that the target notices that their machine is using 100% CPU and removes the bot. It is easier to notice CPU load (heat, fan noise, prominent position in Task Manager) than network load.

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