The Ngioweb botnet, first identified in 2018, has evolved into a major enabler of residential proxy services like NSOCKS, VN5Socks, and Shopsocks5. Exploiting vulnerabilities in Internet of Things (IoT) devices and small office/home office (SOHO) routers, the botnet turns compromised devices into proxies that are sold on underground marketplaces. According to Lumen Technologies, 80% of NSOCKS proxies originate from the Ngioweb botnet, with two-thirds of these proxies located in the United States. The botnet maintains an average of 35,000 active bots daily, with 40% remaining operational for over a month. These proxies enable malicious activities, including credential stuffing and distributed denial-of-service (DDoS) attacks.
The operation, driven by the financially motivated group Water Barghest, uses a sophisticated two-tiered architecture. A loader network of 15-20 nodes directs infected devices to a command-and-control (C2) node, where the Ngioweb malware is deployed. Infected devices are then registered as proxies, making them available for sale on platforms like NSOCKS. The monetization process is highly efficient, with compromised devices becoming functional proxies in as little as 10 minutes. By leveraging IoT vulnerabilities, the botnet targets devices from a wide range of vendors, including NETGEAR, Uniview, and Hikvision, among others.
NSOCKS offers its customers the ability to select proxies based on location, speed, and device type, with prices ranging from $0.20 to $1.50 for 24-hour access. The service also employs a domain generation algorithm (DGA) to establish long-term connections between victim devices and C2 nodes. These nodes evaluate infected devices for eligibility before connecting them to a backconnect C2 node, making them available for use. With over 180 backconnect C2 nodes, NSOCKS not only anonymizes its users but also facilitates the creation of new proxy services by other cybercriminals.
This botnet’s infrastructure poses a significant threat, as it enables attackers to disguise their activities, target specific domains like .gov or .edu, and launch large-scale attacks with minimal traceability. Lumen Technologies has taken steps to disrupt Ngioweb’s operations by blocking traffic to and from its dedicated infrastructure. However, the growing market for residential proxy services underscores the need for robust defenses against such threats, as these networks increasingly empower cybercriminals and advanced persistent threat (APT) groups to execute complex and highly targeted campaigns.
