New malware on Microsoft Marketplace steals passwords and screenshots of desktops

Some developers thought they were installing a dark theme and an AI assistant on their VS Code. However, it turned out to be malware that stole their data.

Researchers at Koi, a cybersecurity firm, have discovered new malicious extensions for Microsoft Visual Studio Code (VS Code). Both extensions were discovered on the Microsoft Marketplace, where developers can download extensions for the popular tool.

The malware disguised itself as a premium dark theme inspired by bitcoin design and AI coding assistant extensions, which infected developer devices with infostealing malware. Both extensions deliver the Lightshot screenshot tool bundled with a malicious DLL ("Lightshot.dll").

The malware harvests clipboard contents, a list of installed programs, running processes, a screenshot of the desktop, stored WiFi credentials, and detailed system information.

It also launches Google Chrome and Microsoft Edge in headless mode to steal stored browsing cookies and can potentially hijack user sessions.

"Your code. Your emails. Your Slack DMs. Whatever's on your screen, they're seeing it too," Koi Security researchers wrote.

“It also steals your WiFi passwords, reads your clipboard, and hijacks your browser sessions.”

The researchers remind us that VS Code themes are JSON files, and they do not require activation events, a main entry point, or the execution of PowerShell scripts. The malicious theme raised suspicion as it ran on every VC Code action.

As a malicious AI assistant, it did provide actual functionality, as users can chat with ChatGPT or DeepSeek chatbots directly in VS Code. This makes it look more credible.

However, within the code, right before the legitimate AI chat implementation, researchers identified intertwined malicious code. The attacker left comments marking the malicious section of their own code.

“This tells us something about their workflow – they're actively maintaining this codebase and wanted to make sure they or collaborators didn't accidentally remove the payload delivery mechanism during updates,” the researchers explained.

Names of malicious extensions:

• BigBlack.bitcoin-black
• BigBlack.codo-ai
• BigBlack.mrbigblacktheme

Microsoft removed the malware from the Marketplace on December 5th and December 8th.

While the first two malicious extensions had already been downloaded by users, Koi researchers told The Hacker News that BigBlack.mrbigblacktheme extension caused no real-world impact as it was removed very quickly.