Observations, Metrics, Trends & Forecast from the Deepwatch Adversary Tactics & Intelligence Team

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Introduction

Welcome to the Deepwatch ATI 2024 Annual Threat Report

For our third year, the Deepwatch Adversary Tactics and Intelligence team presents our Annual Threat Report. Here we provide Deepwatch Observations from 2023, and forecast what organizations can expect in 2024.

With in-depth analysis of our open source intelligence reporting, we share data on nearly 1.5 million security related events detected across our customers' environments, and through response engagements.

For 2023, we cover the most predominant threats, techniques, and trends, as well as our most significant observations. Finally, our 2024 forecast calls for increased cyber resilience.

This report sets itself apart with our proprietary data and insights derived from comprehensive detection coverage coupled with human-led expert investigation and confirmation of threats. The data that powers Deepwatch results from thousands of expert investigations across hundreds of thousands of protected systems.

Each of the nearly 1.5 million detected security related events that we responded to have one thing in common: They were not prevented by our customers' expansive security controls - they are the product of our analytics that we use to detect the threats that would otherwise go undetected.

When our Security Content team and detection engineers develop detection analytics, they map them to one or more corresponding MITRE ATT&CK techniques. If the detection uncovers a potential threat, a Deepwatch expert will investigate and, if confirmed, provide detailed information about the activity observed.

Because we know which ATT&CK techniques a detection aims to detect and which detection led us to identify a threat, we can look at this data over time and determine technique prevalence, correlation, and much more.

To ensure effective detection coverage, Deepwatch takes advantage of a defense in depth strategy encompassing various stages of an attack. As a result, technique coverage is not skewed to a specific stage. This contrasts with other providers whose visibility may focus towards the beginning, middle, or later stages of an intrusion due to technology visibility limitations.

This report examines the broader landscape of threats that leverage techniques and other tradecraft. We also track specific threats associating malicious or suspicious activity with a new or existing threat activity cluster, specific malware variants, abuse of legitimate tools, and known threat actors. ATI continually tracks and analyzes threats throughout the year, publishing weekly threat intelligence reports.

In 2024 organizations can expect:

  • Information Stealing Malware Will Continue to Become More Sophisticated
  • Mass Vulnerability Exploitation and Supply Chain Attacks Will Continue to be a Significant Threat
  • Tactics Involving External Remote Services, User Execution, and Application Layer Protocol Will Continue to be Widely Observed
  • Prevalence of AI in Malleable Tool Performance and Defense Evasion
  • Abuse of Legitimate Internet Services Will Continue, Likely Escalating in 2024
  • Rise of Non-Malware-Based Cyber Attacks in 2024

2023 Top Trends

In an ever-evolving cyber threat landscape, understanding the top threats from the previous year is crucial for organizations to bolster their cybersecurity posture. Identifying the top threats provides valuable insights into the methods and motivations of threat actors and serves as a cornerstone for developing robust defense strategies.

This knowledge enables organizations to anticipate potential attacks, prioritize security investments, and effectively tailor their incident response plans. By analyzing these critical aspects, organizations can see the shifts in the cyber threat environment, identify emerging trends, and proactively adapt to the changing tactics of adversaries

This, in turn, enhances resilience against cyber threats, ensuring the continuity and protection of critical assets, in a landscape marked by sophistication and unpredictability.

MITRE ATT&CK Technique Metrics
Total of All Techniques Observed: 1,343,862

Detection Metrics
Total of All Detections: 1,351,145

Malware and Hacking Tool Metrics
Total Malware Families Report in OSINT: 207

Threat Response Metrics
Total Engagements: 45 (not including benign activity and pentest activity)

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2023 Observations Quick Look

In 2023, over half of incident response engagements involved suspicious activities and account compromises, signifying a major challenge for organizations. These included unauthorized account access and malicious script executions, often evading standard security measures and leading to fraudulent activities. This underscored the need for improved email security and employee training.

Ransomware remained a significant threat, particularly targeting healthcare organizations, with sophisticated attacks using double extortion tactics. Deepwatch responded to a range of ransomware groups, including ALPHV, Monti, and Blacksuite, highlighting the evolving threat landscape.

The year also saw diverse malware and hacking tool attacks, notably impacting the manufacturing and finance sectors. Deepwatch frequently dealt with threats like Raccoon Stealer, IcedID, and Cobalt Strike, emphasizing the need for continuous vigilance and advanced security measures.

Additionally, the exploitation of critical vulnerabilities in internet-facing systems was prevalent, particularly involving known vulnerabilities. This trend called for a proactive risk management approach, evidenced by numerous system exploitation responses, including ColdFusion Exploitation.

The MITRE ATT&CK framework revealed consistent attack tactics in 2023, including Valid Accounts, User Execution, and Brute Force, indicating a focus on exploiting legitimate credentials and user interaction. The most observed tactics were Application Layer Protocol, Valid Accounts, Brute Force, Create or Modify System Process, and External Remote Services.

Finally, malware and hacking tool families like Cobalt Strike, Mimikatz, and QakBot dominated open-source reports. Known for network infiltration and credential theft, these malware families continued to challenge global cybersecurity, quickly resuming operations even after law enforcement disruptions.

Suspicious Activity and Account Compromise Dominated Incident Response Engagement

Account compromise and various forms of other suspicious activity were a top threat for organizations in 2023. The activity typically involves unauthorized access to user accounts, malicious network traffic, script execution, suspicious network traffic, and brute force activity to carry out fraudulent activities, such as stealing sensitive information or requesting wire transfers. Additionally, these attacks can be challenging to detect and prevent because cybercriminals use compromised accounts to access various data and perform actions, such as sending phishing emails and setting inbox rules. Whereas various suspicious activities may bypass security solutions. As a result, organizational leadership expects their security teams to increase their focus on email security and employee training to mitigate the risk of BEC and EAC in 2024.

Ransomware still continues to affect many industry sectors

Ransomware continued to be a significant threat in 2023, as cybercriminals continued to use this type of malware to hold organizations' data and systems hostage for financial gain. Despite increased awareness and efforts by businesses and governments to protect against ransomware attacks, the frequency and sophistication of these attacks continued to advance. The use of double extortion techniques, where attackers encrypt data and threaten to release stolen data publicly, added to the pressure on organizations to pay the ransom. Businesses continue to incur significant losses due to ransomware attacks, both from the ransomware payment and operational costs due to disruption of service and restoration.

Malware

In 2023, Deepwatch observed various malware families during incident response engagements, highlighting the evolving nature of cyber threats. Various malware families have different purposes, from dropping additional malware and data theft to establishing command and control to enrolling the infected device in a botnet. Our team detected and responded to various malware infections, such as Raccoon Stealer, IcedID, Cobalt Strike, ngrok usage, and malicious script executions in customer environments. This diverse range of threats underscores the need for continuous vigilance and advanced security measures in the ever-changing landscape of cyber threats.

Exploitation of critical vulnerabilities for internet-facing systems

In 2023, active exploitation of software vulnerabilities was a common trend observed in the threat landscape. We observed this trend across various industries and organizations, significantly impacting incident response efforts. Many organizations responded to multiple instances of active exploitation, often involving known vulnerabilities and publicly available exploit code. Despite the efforts of security teams to patch and secure systems, the speed and sophistication of attackers made it challenging to prevent or quickly remediate these types of incidents. Looking forward, organizations should take additional steps to be more vigilant and proactive in their approach to risk management to mitigate the impact posed by active exploitation.

Top ATT&CK Techniques and Detections Observed in 2023

In 2023, the cybersecurity landscape was dominated by a consistent pattern of attack tactics and threat detections.

Every month specific MITRE ATT&CK tactics were observed such as:

  • Valid Accounts
  • User Execution
  • Network Service Scanning
  • Create or Modify System Process
  • Brute Force
  • Application Layer Protocol

They underscore a persistent focus of threat actors on exploiting system vulnerabilities and leveraging legitimate credentials for unauthorized access.

This trend suggests that threat actors are increasingly bypassing conventional security measures, emphasizing the need for robust identity and access management. Trends demand continuous monitoring of system processes and network activities.

The top detections, particularly the recurring instances of Suspicious Activity and Increasing Risk Score observed in the majority of months, highlight the critical importance of proactive threat detection and risk assessment strategies.

The frequent occurrence of Internal Network Service Discovery and Increased Activity by New Threat Object detections further indicates that adversaries constantly evolve their methods. It demands a dynamic and adaptive security posture that can quickly respond to emerging threats and anomalies within the network infratstructure.

Top 5 Detections Observed in 2023

External Authentication from Non-Excluded Country: The objective of this detection rule is to detect suspicious authentications to resources by monitoring the country information that the user's are logging in from. If the user is logging in from a Country that is not expected, then it will alert.

Suspicious Activity: This detection rule's objective is to detect when many distinct anomalies are observed for a single user or system over a 7 day time period.

Increasing Risk Score: This detection rule is intended to detect when the risk score for a single user or system rapidly increases in a 24 hour time period.

Increased Activity by New Threat Object: This detection rule is intended to detect when a new threat object (i.e., a known malicious domain, IP address, etc.) is observed across multiple risk objects or detection/anomaly searches in a 7 day time period.

Internal Network Service Discovery: This rule is designed to detect an internal host sending unsolicited packets to many destinations over a single port to map the network or discover live hosts to exploit.

Cobalt Strike, MimiKatz, and Qakbot Among the Most Reported Malware

In 2023, open-source reporting was dominated by a triad of formidable malware families: Cobalt Strike, Mimikatz, and QakBot. These families not only persisted as significant threats ,but also topped the list of the most reported malware in hundreds of open-source reports gathered from various vendors throughout the year.

Cobalt Strike, originally a legitimate penetration testing tool, was frequently exploited by attackers for its advanced network infiltration and reconnaissance capabilities.

Mimikatz, on the other hand, gained notoriety for its effectiveness in harvesting credentials from Windows systems, making it a go-to tool for threat actors seeking unauthorized access.

QakBot, a multifaceted and evolving banking trojan, continued to cause disruptions with capabilities including credential theft and network propagation. While law enforcement action in August 2023 disrupted QakBot operations, it was not long before they resumed operations in December.

The prevalence of these three malware families in 2023 underscores their adaptability, sophistication, and the continuous challenge they pose to cybersecurity defenses worldwide.

Recommendations

Perimeter (Internet Edge)

Organizations should implement a perimeter discovery and attack surface monitoring solution, like Deepwatch's Threat Signal, to identify internet-exposed systems and the threats targeting these systems. Deepwatch's Threat Signal adopts an 'outside-in' perspective, evaluating an organization's externally accessible presence from the perspective of an attacker to pinpoint risky systems and services.

Regularly scan systems for vulnerabilities and patch systems as soon as possible. Prioritization should be placed on those systems that are internet-exposed with a focus on known exploited vulnerabilities like those featured in CISAs Known Exploited Vulnerabilities Catalog.

Assets on the public internet expose exploitable services, such as RDP. Where these services must be exposed, appropriate compensating controls should be implemented to prevent common forms of abuse and exploitation. All unnecessary OS applications and network protocols should be disabled on internet-facing assets.

Integrating a secure email gateway as part of the organizational technology stack can significantly reduce the risk of phishing emails arriving in the end-user's inboxes.

Prevent users from launching embedded files in Microsoft OneNote files, like .hta, .bat, .com, .cmd, .exe, .js, .jse, ps1, .scr, .vbs, and .wsf, through Group Policy settings by using the "Embedded Files Blocked Extensions" template available from Microsoft here.

Accounts

Integrating phishing-resistant multi-factor authentication (MFA) as part of the organizational policy can significantly reduce the risk of a cybercriminal gaining control of valid credentials for additional tactics such as initial access, lateral movement, and collecting information. Organizations can also use phishing-resistant MFA to restrict access to cloud resources and APIs.

An enforced organization-wide policy and process that requires changing default passwords for all hardware, software, and firmware before being deployed on any network. Organizations have a system-enforced policy requiring a minimum password length of 15 or more characters for all password-protected IT assets, and all OT assets are technically possible.

No user accounts have administrator or super-user privileges. Administrators maintain separate user accounts for all actions and activities not associated with the administrator role (e.g. for business email, web browsing, etc.)-Disable remote PowerShell execution for non-administrative users where possible.

Network & Host

Determine if certain websites or attachment types (such as Telegram, Discord, .lnk, and .iso.) are necessary for business operations and block access if security analysts cannot monitor the activity well or if it poses a significant risk.

Prevent users from opening scripts, like .hta, .jse, .js, .vbs, and .wsf, through Group Policy settings and prevent the execution of script interpreters (MSHTA.exe and WSCRIPT.exe) through Group Policy or Application Control.

A system-enforced policy that disables Microsoft Office macros, or similar embedded code, by default on all devices. If macros must be enabled in specific circumstances, there is a policy for authorized users to request that macros are enabled on specific assets.

Employ an anti-virus or EDR solution that can automatically quarantine suspicious files.

Security applications that look for behavior used during exploitation can be used to mitigate some exploitation behavior. Control flow integrity checking is another way to potentially identify and stop a software exploit from occurring.

Disaster Recovery

Customers are highly encouraged to establish an incident response plan and frequently test it. These plans should include the calculation for the amount of time it would take to restore from backups and the overall cost. Customers should restore data from backups when testing their plans.

Customers with encrypted off-site backups should ensure that the digital decryption key or the applications needed to restore are not stored on a local file-sharing network and access is tightly controlled.

2024 Forecast Quick Look

Heading into 2024, the threat landscape is expected to rapidly evolve with sophisticated threats that demand proactive and dynamic responses.

Information-stealing malware will likely become more advanced, capitalizing on compromised credentials and expanding the cybercriminal toolbox beyond traditional malware.

Organizations will also witness a surge in mass vulnerability exploitation and supply chain attacks, with cybercriminals exploiting software-as-a-service vulnerabilities. They reveal the critical need for organizations to validate their suppliers' cybersecurity practices.

Furthermore, predictive analysis indicates a continued reliance on tactics like External Remote Services, User Execution, and Application Layer Protocol, as per the MITRE ATT&CK framework, signaling persistent and sophisticated attack vectors.

The integration of Artificial Intelligence in malware development will add a new dimension to threat capabilities, enhancing evasion techniques and adaptability.

The abuse of legitimate internet services is expected to escalate, with platforms like GitHub and Telegram being increasingly leveraged for malicious purposes.

Finally, organizations may see more malware and tool-less attacks as threat actors leverage compromised credentials to access networks and employ various techniques to avoid files. As the threat landscape evolves, these trends underscore the urgent need for robust and adaptable cybersecurity strategies in 2024.

Information Stealing Malware Will Become More Sophisticated

As cybercriminals look for new ways to access sensitive information for financial gain, information-stealing malware will continue enhancing their capabilities, increasing in sophistication in 2024. As long as organizations allow users to store credentials in their browsers and policies are not established to invalidate sessions after they have ended, cybercriminals will continue to use infostealers to compromise accounts.

In addition, as more businesses and individuals work remotely and use devices to access sensitive internet-facing systems, the attack surface increases, giving cybercriminals more attack vectors. As a result, we can expect to see a continued increase in the development and use of information-stealing malware as a means for cybercriminals to steal sensitive information and sell it on cybercriminal marketplaces.

Mass Vulnerability Exploitation and Supply Chain Attacks Will Continue to be a Significant Threat

2023 saw cybercriminals exploiting vulnerabilities to target hundreds of organizations. Significant events included mass exploitation of vulnerabilities in Fortra GoAnywhere, Progress MOVEit Transfer, and Citrix, as well as the supply chain attacks against 3CX, JetBrains, and Okta.

As more organizations use software-as-a-service to streamline critical processes, the attack surface for cybercriminals continues to expand. As more sensitive information is stored and processed online, the incentives for attackers to find and exploit vulnerabilities in these software systems will only continue to grow. Many organizations do not validate the cybersecurity of their suppliers, making them attractive targets for cybercriminals.

This highlights the need for organizations to vet the cybersecurity practices of their suppliers, before acquiring any software solution.

Techniques Involving External Remote Services, User Execution, and Application Layer Protocol Will Continue to be Widely Observed

Our predictive analysis, leveraging advanced data analysis modeling techniques on historical cybersecurity data, provides a forecast for the upcoming year that is crucial for shaping cybersecurity strategies. We focused on the three most observed MITRE ATT&CK techniques - 'External Remote Services,' 'User Execution,' and 'Application Layer Protocol.'

The model anticipates a fluctuating yet consistently high occurrence for External Remote Services. Adversaries initially leverage external-facing remote services to access and/or persist within a network. This suggests threat actors' sustained reliance on this technique, necessitating continued vigilance and enhanced defensive measures in network security and access control protocols. Remote services such as VPNs, Citrix, and other access mechanisms allow users to connect to internal enterprise network resources from external locations. Often, remote service gateways manage connections and credential authentication for these services.

User Execution is forecasted to maintain a relatively stable presence. This stability implies continued reliance on users to interact with files and highlights the importance of ongoing user education and behavioral analysis as key defense strategies. Adversaries rely on user interaction for the execution of malicious code. User interaction may include installing applications, opening email attachments, or granting higher document permissions. Adversaries may embed malicious code into files such as Microsoft Word and Excel documents or software installers. Execution of this code requires that the user enable scripting or write access within the document. Embedded code may not always be noticeable to the user, especially in cases of trojanized software.

The Application Layer Protocol technique is expected to increase slightly in use. This uptrend underscores a growing sophistication in attack methods targeting application layers, emphasizing the need for robust application security and real-time monitoring systems. Adversaries take advantage of high-use protocols to avoid detection/network filtering by blending in with existing traffic. Commands to the remote system, and often the results of those commands, will be embedded within the protocol traffic between the client and server. Adversaries may utilize many protocols, including those used for web browsing, transferring files, email, or DNS. For connections that occur internally, such as those between a proxy or pivot node and other nodes, commonly used protocols are SMB, SSH, or RDP.

These forecasts underscore the importance of adaptive and proactive cybersecurity strategies. While the consistency in some techniques reflects persistent threat vectors, the variations highlight the evolving nature of cyber threats. Organizations should prioritize resource allocation towards these identified areas, ensuring their defense mechanisms are robust and agile enough to respond to these projected trends.

Prevalence of AI in Malleable Tool Performance and Defense Evasion

The rapid advancement of AI's technical capabilities along with its increased availability to the general public has provided an easy way to leverage its capabilities without a high level of technical proficiency. While very few real-world examples of AI being used by adversaries have been noted, given AI's ease of use and available nature, its usage in malicious operations is expected to increase in 2024. One example of how threat actors can use AI is to enumerate various obfuscation variances of the same command/objective. While specific prompts requesting obfuscation routes for a command may be denied for violating content policies, bypassing these restrictions is not difficult.

Taking one command a malware sample needs to run and using AI to create a list of various obfuscated versions as backup paired with logic error handling is a simple example of how malicious developers and threat actors could use AI to add redundancy and flexibility to malicious code with minimal time investment. While partially automated, this still involves manual/static inclusion of the generated variants of the original command. Beyond using AI to enumerate commands, the idea of connecting an AI tool to a Command and Control (C2) panel and programming prompts based on status updates from infected endpoints reporting to the C2 server is not far-fetched given current AI tools’ compatibility with API’s and automated input. Doing so would allow a C2 server to dynamically create alternate commands/routes that would be returned to the infected client if a specific action is detected or blocked by Endpoint Detection & Response (EDR) or Antivirus solutions.

This type of dynamic adaptation enabled by AI would not only allow individual compromised hosts to adapt to defensive measures, but it could also allow the entire fleet of compromised machines to receive AI-generated code that has adapted since the original malware deployment to evade global updates to defensive measures such as CrowdStrike and Windows Defender.

Malware polymorphism is not a new concept, and malleable profiles and modularity of components have been around for decades. Still, the presence and availability of AI presents an opportunity to integrate these features with a lower skill level and time commitment.

For defenders, malicious code with access to the command and control server may act more like a human operator with complex problem-solving skills and more persistent and diverse actions at the procedural level. Malware with AI-based augmentation is significantly less likely to try an action, be blocked, and run out of error-handling mechanisms to achieve the objective. This persistence and adaptation, typically seen more with "hands-on keyboard" activity by human operators, will become increasingly available to automated malware strains. As the chances of evading defenses increase, defenders must pay more attention to alerts in a shorter time frame.

Abuse of Legitimate Internet Services Will Continue, Likely Escalating in 2024

As we advance into 2024, the cyber threat landscape is expected to see a marked increase in the abuse of legitimate internet services (LIS) by threat actors. This trend, observed extensively in recent years, points towards a strategic shift in cybercriminal activities. The ability to leverage platforms like GitHub, Telegram, and Discord provides a veil of legitimacy, making detection and defense increasingly complex for cybersecurity professionals. These services, designed for efficiency and ease of use, inadvertently offer a fertile ground for malicious activities, blending criminal actions within the bounds of normal network traffic.

Rise of Non-Malware-Based Cyber Attacks in 2024

The threat landscape in 2024 may witness a significant shift in attack strategies, veering away from traditional malware-based approaches. Instead, threat actors may increasingly leverage compromised credentials to infiltrate systems and networks and employ various techniques to avoid the need to deploy malware and other tools. If it comes to fruition, this trend will highlight a tactical change where attackers use sophisticated methods to bypass conventional malware detection tools.

Compromised credentials may increasingly become a primary vector for cyber attacks in 2024. By utilizing stolen or weakly secured credentials, attackers can gain unauthorized access to systems without raising the usual red flags associated with malware. Attackers may then employ techniques that blend seamlessly with normal network behavior, avoiding files and making detection significantly more challenging for traditional security defenses.

While info stealers will still be used to harvest credentials, stolen credentials are often sold to other threat actors, separating the initial compromise from subsequent unauthorized activities, resulting in essentially two separate attacks. This separation will complicate the detection of post-credential theft activity. It will further complicate attribution and response efforts, as the link between the credential theft and the eventual unauthorized access is obscured, especially if the initial compromise occurred on devices outside the purview of corporate security.

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Deepwatch Threat Intelligence Process

Requirements Gathering, Planning, and Direction. The ATI team mission is to provide intelligence that drives effective business decisions. We derive requirements from a combination of shifts in the cybersecurity landscape and customers' business needs.

Collection, Collation, & Processing. ATI collects data through various methods, including open-source and internal intelligence. Collected data is ingested into a centralized system for analysis where it can be collated and processed for analysis.

Analysis & Production. Threat Intelligence Analysts examine and evaluate all the information collected, add context as needed, and integrate it into a complete finished intelligence product. These products include assessments of events and estimates about the developing threat landscape.

Dissemination. Relevant intelligence is disseminated both to Deepwatch internally and to our customer base through various mechanisms: including but not limited to weekly Cyber Intelligence Briefings, alerting, and time-sensitive Advisory Reports.

Feedback and Evaluation. Feedback and evaluations is a continuous process that occurs at all stages of the intelligence lifecycle and after we have completed the analysis and disseminated the final product. This process is essential to ensure that produced intelligence effectively provides cybersecurity operational value and drives strategic business decisions.

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